Globally, bigger firms are already going on a fundraising spree. While Boeing has raised $25 billion through a bond sale, Lufthansa
has entered into an initial agreement with the German government on a 9-billion-euro bailout deal.
Experts said drying up of new digital projects would start reflecting in the deal pipeline from the second half of this year. “Almost every IT services
company will be impacted in some form or other due to disruption in digital projects. Major impact will be seen in the short term, mostly during the second half of 2020 when the pipeline starts shrinking,” said Hansa Iyengar, principal analyst, digital enterprise services, at global consultancy firm Omdia.
Currently, most Tier-I IT services
firms like Infosys, Tata Consultancy Services and Wipro draw about 40 per cent of their revenues from digital services. “The industries that are seeing the greatest impact are retail, hospitality and travel, and oil & gas. However, we are now seeing other industries moving into the highly distressed mode, such as manufacturing, public sector and consumer packaged good,” said Peter Bendor-Samuel, founder and CEO of the Everest Group.
However, most experts say enterprises might start spending on digital initiatives from early 2021. They even see some verticals having a rapid adoption of digital initiatives as a fallout of the pandemic.
“In some cases, the pandemic has accelerated digital investments in sectors like retail, automotive sales, insurance, healthcare, and education. Overall, digital programmes are likely to resume from early 2021,” said Iyengar of Omdia.
General Motors has shut down its car-sharing service ‘Maven’ permanently
Walmart has decided to pull the plug on its ecommerce subsidiary Jet.com
Royal Bank of Scotland has abandoned its digital banking initiative ‘Bo’
Cancellation of projects, dearth of new deals to dry up deal pipeline in H2 of 2020