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IT Earnings outlook is negative on EPS growth (FY 10)


Interesting Image from an ET Article: Weakening demand growth to dent IT companies’ profits:

How can the FY 10e P/E be greater than the FY 09e? That means, for the same price, earnings per share is supposed to DECLINE from FY 09 to FY 10? I guess they have allowed for a tax regime to kick in (currently no Indian taxes). But still, to believe that EPS will go down for the big IT companies – and every single one of them – is a major surprise to me.

Note: I don’t agree or disagree – I have no estimates of my own other than that life in general will be bad, so why not IT. But this is the first time I’ve heard of IT earnings outlook being negative on EPS growth.


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