Religare Institutional Research expects steady growth from Indian IT vendors in Q2FY15, with USD revenues growing in the range of 2-7% QoQ for large players. TCS and HCL Tech are likely to be in the top quartile, while Wipro's growth is expected to lag its peers.

The USD has appreciated 3.4% against the EUR during the quarter which will have a negative impact of 40bps on USD growth. Margins are expected to improve led by INR depreciation, operating efficiency and absence of visa costs, it said.

"Overall demand commentary and outlook for H2 would be the key factors to watch. We maintain our preference for large-caps over mid-caps," Religare added.

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