Over the last six months USD has strengthened against most currencies resulting in cross-currency impact on IT Services firm. The USD's appreciation against global currencies is likely to impact the reported revenue growth of Indian IT companies in Q4FY15, according to Marwadi Shares & Finance (MSFL).

''We expect that the negative impact of cross currency movement will be felt in FY16E as well given the currencies stay at same level. But on the demand side, we continue to reiterate our view that FY16E demand environment would be inline or better than FY15E led by increasing spends in SMAC, improving discretionary spending in US, outsourcing in Continental Europe and improving spends in verticals like Healthcare,'' it added.

''For Q4FY15, the pecking order in terms of USD revenue growth (q-o-q) for large companies is expected to be: Tech Mahindra (~4%) leading the pack followed by HCL Tech and Wipro (1%). We expect tier-I companies to lead growth during FY16 with volume growth to be 10%+ and expect demand for CY15 to be similar as that in CY14, however, we have cut our FY15-17P EPS by 1-4% for tier-1 IT players and 3-8% for others to build in the cross-currency headwinds. We continue to remain positive on Infosys and Tech Mahindra,'' the broking firm opined.

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