IT firms see good results

By Sangeetha Kandavel

Chennai

July 6: As the result season for corporates is all set to begin, analysts have noticed that larger Indian information technology companies such as Infosys, Tata Consultancy Services and Wipro are gaining from vendor rationalisation exercise carried out by clients, especially in the BFSI segment.

Indian IT majors especially Infosys, TCS and Wipro could gain from the present downturn, as banking and financial institutions in the west seek to source IT services from a single vendor.

According to a research note released by Edelweiss, clients are increasingly seeing advantages of outsourcing multiple processes, applications and infrastructure to a single provider.

This, coupled with news of some thaw in the current environment, should help provide the needed H2 visibility that investors seek.

The research report also said that companies such as Infosys, Wipro and Satyam Computers are offsetting the pressures in the BFSI segment from traction in telecom and manufacturing.

There are strong spending tailwinds and new opportunities in the form of cable companies opening up to IT outsourcing as key growth propellants in this vertical.

Edelweiss expects these companies to raise the guidance as they expect the last two quarters to push the annual results. In other words, back-ended growth is an ugly way of saying that most of the growth would come from third and fourth quarters.

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FIIs bearish on S. America

By Joyeeta Dey

New Delhi

July 6: Having sold Indian shares worth close to Rs 5 trillion since beginning of this year, the overseas investors seem to be ploughing back the money to the bond market in India and abroad as well as equities in other emerging economies such as in Latin America.

After a sharp rally for the past few years, the Indian stock market has been under an intense bear grip since January this year, which has seen the total value of all listed stocks here plunging by more than a third or over Rs 25,00,000 crore.

Out of this, foreign institutional investors (FIIs) are estimated to have incurred a loss of close to Rs 3,00,000 crore, which is also equivalent to nearly one-third of their total holdings before the downslide began on the bourses. FIIs are estimated to have sold shares worth more than Rs 4,70,000 crore so far in 2008. — PTI