Retention Is the New Acquisition In Indian IT’s Slowdown Year

In India’s tech services industry, romance has given way to prudence. The days of IT giants flashing new client logos like coveted trophies are over. Instead, they are now wooing familiar faces with renewed vigour. 

Tata Consultancy Services, Infosys, and Wipro—India’s tech titans—are shifting focus from conquest to conservation as the deal landscape cools. They are stressing on client retention via long-term contracts, sector-specific bets, and platform plays—suggesting that in today’s market, guarding existing relationships trumps chasing new ones. 

Indian IT companies are not directly affected by the global tariff war yet, but customers may remain cautious about making large technology investments. 

For Indian IT companies, the effort will be to remain indispensable.

Deliberate Deal-Making
Their January-March quarterly numbers tell the tale. TCS pulled in $12.2 billion in deal wins, but sales dipped 1% sequentially. Infosys landed just $2.6 billion in large deals, down from $4.5 billion a year ago. Even Wipro’s $650 million Phoenix Group contract—possibly the largest in recent memory—couldn’t prevent guidance for a sequential revenue decline of 1.5%–3.5%.

It’s not that deals are not happening. They are—just at a more deliberate pace and with clients being pickier than ever. What makes the cut? Non-discretionary projects tied to compliance, cost optimisation, and mission-critical technology upgrades. In other words, the entree of IT spending, not the dessert. 

Client retention isn’t just a sales strategy; it’s now a defence strategy. As competition intensifies and vendor consolidation picks pace, existing accounts are at the risk of being repriced, rescaled, or rebid. Every retained contract is a win against a zero-sum backdrop.

Some sectors still have appetite. Energy and utilities continue to invest in digitisation and ESG reporting—explaining Infosys’ $36 million acquisition of MRE Consulting, a niche US player in that space. BFSI remains cautious but stable, particularly in core banking and risk management. Pharmaceuticals and life sciences are still upgrading systems.

But the discretionary wallet remains firmly shut.

The trio’s approaches to this new reality reveal distinct personalities. TCS is playing the long game, pouring nearly ₹50 billion in 2024-25 to improve infrastructure, platforms, and service delivery. It’s an expensive bet, but one aimed at making client relationships so integrated that separation becomes unthinkable. 

Infosys is betting on vertical expansion. Their focus will be less on adding new logos and more on gaining more wallet share from existing clients. M&As help, but so does domain-specific consulting.

Wipro’s strategy is harder to read. The Phoenix deal may boost visibility, but its overall revenue trends suggest it’s still finding its footing. Long-tenure contracts help retain clients, but can also lock firms into low-margin engagements.

Muscle Memory
Despite the slowdown, these firms aren’t abandoning their talent pipelines. Infosys plans to bring in 20,000 freshers in 2025-2026 and has resumed salary hikes of 5–8% across the board, and up to 12% for top performers. Attrition nudged up to 14.1% but remains manageable.

TCS is more circumspect. It onboarded 42,000 freshers in 2024-2025, linking future hikes to market visibility. Wipro remains the most conservative with no firm hiring plans or increment updates, only that wage decisions will come “closer to the date”.

The broader signal is clear: this isn’t a hiring freeze. It’s a recalibration. The focus is on bench strength and cost-effective talent. In a future-facing sector, you don’t downsize your way to resilience.

Margins face pressure not just from wage bills but from clients demanding champagne service at beer prices. TCS maintains the most disciplined cost structure. Infosys, having pulled the increment lever early, is taking a bigger near-term hit. Wipro appears to be in survival mode.

Everyone’s leaning harder into automation and AI-code generation tools, managed services platforms, and IP-led delivery. These aren’t new initiatives, but with discretionary spending fading, they’ve transformed from nice-to-have into need-to-scale.

In this context, platform stickiness isn’t just about technology—it’s about tenure. As clients demand measurable RoI, the ability to offer bundled services under one roof, with seamless integration and long-term support, becomes a key differentiator.

Global trends mirror the same reality. Accenture’s bookings remain strong, but sales growth lags. Cognizant has flagged BFSI softness and project delays. The Indian IT slowdown isn’t an isolated problem but part of a global reset.

For investors, each company presents a distinct proposition. Infosys is making bold bets on people and platforms, but its weakening deal pipeline raises eyebrows. TCS is playing the long game with infrastructure investments and sticky deals. Wipro is still in reboot mode.

For Indian IT, it is going to be a year of operational muscle memory. The firms that succeed won’t be those chasing headline-grabbing deals or outdated metrics. They will be the ones who understand that in a downcycle, relationships are your biggest asset. 
For an industry built on disruption, the most important innovation now might be something decidedly old-fashioned: client loyalty.