According to Crisil, an Indian analytical company providing ratings, research, and risk and policy advisory services , the Indian IT industry would have a 'solid comeback' in 2021-22, with revenue growth of up to 11 percent.

Growing outsourcing and rapid digital transformation enterprises, primarily in sectors like banking, financial services, and insurance (BFSI), healthcare, retail, and manufacturing, will drive the recovery, according to the report.

According to Nasscom, the IT industry would grow by 2.7 percent to $ 99 billion in 2020-21. According to the business foyer, the overall business, which includes e-commerce, enterprise course of administration, and global back offices, grew by 2.3 percent to $ 194 billion in the previous fiscal year.

Azim Premji, the founder and chairman of Wipro, predicted a double-digit increase as well.

Increased enterprise levels, as well as more profitable digital solutions (45 percent share of sales in FY21 versus 40 percent in FY20), according to Crisil, can help IT services players maintain healthy operating margins.

“With consumers focusing on cost-cutting, outsourcing of IT services is steadily increasing around the world. Due to an increase in remote working, e-commerce, and automated services, the pandemic has created new opportunities in digital services, according to Crisil's senior director Anuj Sethi.

He went on to say that deal wins by Indian gamers increased by 20 percent year over year in 2020-21, with 80 percent of them being digital offers across all verticals.

The income growth in 2021-22 will be about 4 percentage points higher than the six percent growth in the previous fiscal year and similar to the 10 percent growth in fiscals 2018-2020, according to the firm.

BFSI, which accounts for 28 percent of IT service revenue, is expected to grow by 13-14 percent this fiscal year, up from nine percent in FY21, due to a growing share of digital transactions, continuous regulatory compliance, and information security, according to the company.

Retail and manufacturing, which together account for 30 percent of revenues, are expected to rise 8-9 percent after slowing to 2-3 percent last fiscal year, according to the report.

Healthcare, while being a tiny sector accounting for less than six percent of revenues, will continue to grow at a rapid rate of 15-16 percent, thanks to rising spending on COVID-19 and the growing use of digital firms.

Despite stronger revenue growth, profitability is unlikely to exceed levels seen in 2020-21, according to the company, which added that working margins increased two share points to a seven-year high of 25 percent in the previous fiscal year, owing to cost savings from lower travel and a favorable onshore-offshore mix (due to fewer onsite roles).

“With the ongoing normalization of enterprises throughout the world, a partial reversal of the cost reductions documented last fiscal is probable this fiscal,” said Rajeswari Karthigeyan, affiliate director.

Worker prices, which account for 67 percent of revenues, are expected to climb as a result of the expansionary recruitment section, as well as the maintenance of higher bench energy.

Given their lowly leveraged steadiness sheets and strong liquidity, the business anticipates sustained improvement in the credit quality of most IT companies.

It claimed that the recurrence of other waves of the pandemic in the United States and Europe, which are crucial regions for IT companies, could be the factors to watch.