IT services companies may see business from US retailers fall sharply, as some non-essential and luxury brands shut stores and furlough employees, analysts said.
Neiman Marcus and JC Penney did not respond to detailed queries by ET. Infosys declined to comment. “Any IT services company with higher exposure to luxury retailers is bound to take a hit. The non-essential retailers are not going to come back strong soon,” said Sanchit Vir Gogia, CEO of Greyhound Research. Peter Bendor-Samuel, CEO of Everest Group, said the slowdown at retailers would have “the effect of initially postponing large projects, then it will likely give way to aggressive cost take out programmes”. Such cost reduction may, however, also create an opportunity for some Indian technology services providers, he added.