Tier-2 IT companies would continue to outpace tier-1 on revenue growth, but they are not immune to sequential margin compression. Q1FY27 Ebit margin performance would be a mixed bag. Apart from the rupee’s depreciation, margin movement would depend on company-specific factors: wage-hike cycles (TCS, Wipro, LTM), large-deal ramp-up, business-related seasonality, and impact from acquisitions. IT firms are largely expected to maintain FY27 margin guidance.
