'Tech firms back to decent growth'

MUMBAI: Indian software service companies are seeing a pick-up in business from overseas customers following a tough year, with clients awarding larger contracts than before, a leading industry official said. India's software industry, which has acquired a reputation for high quality, low-cost service, saw export growth slow to about 29 percent in the year to last March, from around 50 percent in previous years, as firms cut technology spending amid a global slowdown.

"The panic is over. The industry is back to a phase where it is growing decently," Azim Premji, Wipro Chairman told reporters at an informal meeting in Mumbai. "The kind of tough steps that companies had to take, of downsizing, prioritizing...a part of that is over. They seem to be back in the decision-making phase."

Nasscom’s forecast that the industry would grow 30 percent in the year ending in March looks "very valid," he said. "Customers are awarding bigger contracts than they would have typically done two to three years ago," he said. "They are getting bolder. They need cost takeouts faster as they come under a lot of pressure from CEOs and CIOs who want more for less, and India is strongly placed for 'more for less'".

Wipro, whose largest market is the the United States, plans to grow by seeking more business in Europe, Asia-Pacific, Japan, Middle East and India and by acquiring companies to expand the range of services it can offer. Wipro has announced four acquisitions in the past six months and the company is bidding for big orders.

"We continue to be a premium player. But if an account is strategic or potentially very large we are more flexible. But we have strict floors beyond which we do not go," he said. NYSE-listed Wipro would fund a large purchase, if one came up, through cash and stock, Premji said. Within India, Wipro is also aggressively trying to net government orders.

© Reuters

MUMBAI: Indian software service companies are seeing a pick-up in business from overseas customers following a tough year, with clients awarding larger contracts than before, a leading industry official said. India's software industry, which has acquired a reputation for high quality, low-cost service, saw export growth slow to about 29 percent in the year to last March, from around 50 percent in previous years, as firms cut technology spending amid a global slowdown.

"The panic is over. The industry is back to a phase where it is growing decently," Azim Premji, Wipro Chairman told reporters at an informal meeting in Mumbai. "The kind of tough steps that companies had to take, of downsizing, prioritizing...a part of that is over. They seem to be back in the decision-making phase."

Nasscom’s forecast that the industry would grow 30 percent in the year ending in March looks "very valid," he said. "Customers are awarding bigger contracts than they would have typically done two to three years ago," he said. "They are getting bolder. They need cost takeouts faster as they come under a lot of pressure from CEOs and CIOs who want more for less, and India is strongly placed for 'more for less'".

Wipro, whose largest market is the the United States, plans to grow by seeking more business in Europe, Asia-Pacific, Japan, Middle East and India and by acquiring companies to expand the range of services it can offer. Wipro has announced four acquisitions in the past six months and the company is bidding for big orders.

"We continue to be a premium player. But if an account is strategic or potentially very large we are more flexible. But we have strict floors beyond which we do not go," he said. NYSE-listed Wipro would fund a large purchase, if one came up, through cash and stock, Premji said. Within India, Wipro is also aggressively trying to net government orders.

© Reuters