Tech sector cautiously optimistic; cost pressures may spur opportunities: HCL Group's Roshni Nadar

Time of India

30-04-2025

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Amid the ongoing global trade cross-currents, the tech industry remains "cautiously optimistic" and believes that tariff and inflationary pressures in the US may trigger cost-optimisation moves leading to "opportunities" for Indian IT companies, Roshni Nadar Malhotra, Chairperson of HCL Group has said. Roshni Nadar Malhotra - ranked fifth among the world's wealthiest women - termed the trade and tariff situation as "a double-edged sword"."We remain cautiously optimistic because we work for customers across these industries which could be impacted by tariffs, not us as an industry directly, especially in the largest markets, which is in the US," she said on the sidelines of an event.At the same time, there is a realisation that the only way to counter tariff pressures, and indeed any rise in inflation, is cost optimisation."That is where technology can help, so it is a bit of a double-edged sword in terms of what is happening, but there are opportunities," she said.The top boss of HCL Technologies , Nadar scripted history when she became the first Indian to step into the top 10 in Hurun Global Rich List 2025 for women.Her climb to the coveted spot came after her father Shiv Nadar, the billionaire founder of HCL Technologies , transferred 47 per cent of his stake in HCL Corporation and Vama Sundari Investments (Vama Delhi) to her - a move that made her the largest shareholder of the $12 billion tech behemoth.Malhotra's comments come at a time when the Indian IT industry's narrative post-Q4 performance has been largely subdued, as macro uncertainties compounded by global trade woes are seen to be eroding sentiments and weighing on business outlook.Export-led USD 280 billion Indian IT sector is not directly hit by Trump 's tariff order on goods, per se, but it does derive a sizeable chunk of revenue from servicing clients in the US, a market some say is staring at an increased risk of slowdown, or worse -- recession.India and the US are meanwhile engaged in talks to hammer out a bilateral trade agreement that would avoid reciprocal tariffs. A 26 per cent 'reciprocal' tariff on Indian exports to the US is currently on a 90-day pause, set to expire on July 8. However, like other countries, India is presently subject to a 10 per cent tariff under the existing policy.Earlier this week, US Treasury Secretary Scott Bessent said that India is likely to be among the first countries to finalise a bilateral trade agreement with America to avert reciprocal tariffs by President Donald Trump.As such, India's IT services sector has been facing growth headwinds over the past quarters with clients in the US and the EU closely scrutinising tech spends amid economic pressures, while increased AI fascination had compounded fears of reduced job creation globally. Adding to the woes now, prospects of global economic wars, given the US' tariff offensive on trading partners and major allies, has deepened worry lines about slowdown in the United States, and uncertainties ahead.Earlier this month, HCL Technologies posted an 8.1 per cent increase in consolidated net profit at Rs 4,307 crore for March quarter 2024-25, mainly on account of large deals with a total contract value of about Rs 25,500 crore.HCLTech had logged a profit of Rs 3,986 crore for the same period a year ago.Revenue from operations increased 6.1% to Rs 30,246 crore from Rs 28,499 crore in the March quarter of 2023-24.For the year ended March 31, 2025, HCL Technologies posted an increase of about 11 per cent in net profit at Rs 17,390 crore from Rs 15,710 crore in FY24. Revenue from operations rose 6.5 per cent to Rs 1,17,055 crore year-on-year.For FY26, the company expects revenue growth of 2-5 per cent on year-on-year basis in constant currency terms and its services revenue growth too is expected to be in the same range which is higher than its major rivals.On the guidance, HCL Tech CEO and Managing Director C Vijayakumar had recently said that discretionary spending will continue to be subdued in this environment."Geopolitical factors like tariff and deglobalisation are expected to impact IT services. In the coming months, it will be an important topic to observe and monitor the ongoing development."As we look beyond the uncertain short term, I strongly believe there will be strong growth opportunities emerging out of the market uncertainty," he had said.