Anshuman Daga
BANGALORE: India's Infosys Technologies Ltd., in the midst of dealing with a
slowing software market, is targeting established global companies with deep
pockets to ensure a steady flow of new spending. The software group's recent
business wins from some of its existing large clientele are a clear pointer to
this trend, analysts said on Wednesday.
"Infosys seems to be saying that its business is not really unstable and
business from its bigger clients will continue to grow," Sanjeev Goswami,
software analyst at SSKI Securities, told Reuters.
The Bangalore-based software leader on Wednesday firmed up a three year-old
relationship with Toshiba Corp and said it would help the Japanese electronics
giant's overseas branches to build information infrastructure. Infosys sent
jitters throughout India's fast-growing software industry in early April when it
warned that its revenues would grow by just 30 percent this year, down from an
average of about 90 percent in the past four years.
Anil Tewari, analyst at Goldman Sachs, said Infosys was getting a stable
source of revenue from Toshiba. "It is significant that Infosys can boost
its relationship with such a large and well-established global firm. It means
that demand is much more 'sticky' from such firms," Hong Kong-based Tewari
told Reuters.
The Toshiba news came a day after Infosys announced a deal with financial
services group American Express Co., computer technology company TIBCO Software
and investment firm WestBridge Capital to create a business software company.
Positive data
focused on the present uncertainty and likelihood of more uncertainty in the
near-term (for IT firms)," Tewari said. "These are positive data
points, which reinforce the view that there are companies that are willing to
expand relationships with high quality Indian companies," he said.
The company, which has a work force of 9,800, has said it will cut exposure
to risky startups. Nasdaq-listed Infosys in recent weeks has expanded business
relationships with existing significant clients outside the technology sector,
such as New York Life International Inc and Germany's BHF-Bank.
(C) Reuters Limited 2001.