Expect cash-rich IT to go shopping

Mumbai | Bengaluru: Cash rich IT services providers Tata Consultancy ServicesNSE -3.18 %, InfosysNSE -3.14 % and WiproNSE -1.74 % are likely to go on an acquisition spree, as companies will be available at discounted valuations due to the Covid-19 crisis. The three companies collectively have cash reserves of more than $13 billion, a substantial firepower in a downturn which could help them buy smaller rivals in niche segments.

Acquisitions may help them gain strategic capabilities and market access, and boost growth once business is back to normal. They could look for opportunities in cognitive and self-healing IT platforms and cloud-based cyber security products, which are in demand by their clients.