Indian IT Services Market Grew 7.1% Year-on-Year in 2014, According to IDC
02 Jun 2015
According to new data from IDC, the Indian IT Services market grew 7.1% year-on-year to reach INR 470,708.13 million (USD 7719 million) in calendar year 2014. During second half of 2014, compared to same period during the previous year, the market saw a slight uptick primarily on the back of higher demand for hosted infrastructure, hosted applications services, custom application development, IT consulting, and application management services. Besides this, there was a renewed focus on infrastructure projects.
Vivek Gautam, Research Manager, IT Services & Software IDC India said, "The expanding start-up community and increasing technology adoption by small and medium enterprises (SMEs), who favour an OPEX over a CAPEX model of IT, is creating healthy demand for hosted infrastructure, hosted applications, managed and datacentre services. The market for these services will continue to grow at rapid pace over next few years"
The Indian IT services market remains primarily driven by project-oriented services like systems integration, network consulting and integration, custom application development, and IT consulting. When considered together, these services grew year-on-year by 7% (in INR) during 2H 2014. The total IT outsourcing services market grew at 6.8% during the same period while support & training services grew at 6.5%.
Among various verticals, Banking, Financial Services and Insurance (BFSI) and Retail fared better. Within the BFSI vertical new banking licenses awarded by RBI, increasing technology adoption by Non-Banking Financial Companies (NBFCs), and microfinance institutions pushed the demand for IT services. In Retail, vertical emergence of e-commerce continues to be a key growth driver. The new age e-commerce players are not only making technology investments themselves but also are forcing traditional brick and mortar players to embrace technology at wider scale. Some of the other verticals, including Healthcare Services, and Government continued to see healthy demand for IT services.
"Indian organizations are increasingly looking at technology as a key business enabler, a means to improve supplier/customer engagement and gain better business oversight. Many of them are spending more on technology including social, mobile, analytics and cloud (SMAC) for the same reasons. For instance today Indian enterprises, across industries, are investing in custom mobile applications for services delivery, managing field workforce, launching targeted marketing campaigns and so on. Many are even integrating applications with backend data for deeper analytics," added Gautam.
IDC India expects the local IT Services market to grow at a compound annual growth rate (CAGR) of 10.8% (in INR) between 2014 and 2019. Near-term services market growth will be driven by license awards for Payment Banks and Small Scale Banks, current government's pro-technology stance (Digital India, mobile based delivery of citizen services, focus on financial inclusion, spend towards smart cities etc.), burgeoning start-up community, and sustained investments across 3rd Platform technologies.
 The growth is calculated based on the local currency of Indian Rupees.
ContactFor more information, contact:
+91 124 476 2326