Friday January 11, 02:38 PM
ROUNDUP Infosys sees some 'uncertainty' due to delay in IT budget from clients
BANGALORE (Thomson Financial) - India's Infosys Technologies Ltd said it faces some 'uncertainty' in the near future due to an almost one-month delay in the release of IT budgets from its clients, but emphasised it expects a positive
trend in billing rates.
The Nasdaq-listed company also said it sees a big rise in offshore spending from its clients going forward.
On average, growth global companies IT budgets' has slowed to 6-7 pct this year from last year's 8 pct due to macroeconomic issues such as the slowing US economy and subprime crisis, analysts said.
The demand for offshore services remains strong, and India's second-largest software exporter expects this demand to increase in the coming years, said Ashok Vemuri, senior vice-president and head of Infosys' banking and capital markets division.
'The market for offshore IT spending is estimated to be 200220 bln usd, and Indian vendors have so far managed to nibble less than 10 pct,' said R Ravi, an analyst at Karvy Stock Broking.
Global technology services' spending is roughly estimated to be at 1 trln usd annually. Even if only one fifth goes offshore, it translates to a market of 200 bln usd, analysts said.
Indian vendors have barely tapped the available opportunity, so it should not be difficult to grow the offshore market by 25-30 pct per year in US dollar terms over the next couple of years, Ravi added.
Infosys said some 62.3 pct of its revenue came from North America quarter to end-December. It is targeting Europe, Australia, Japan, Latin America, India and China and new services such media & entertainment and transport & logistics for future growth, chief financial officer V Balakrishnan told Thomson Financial News.
Looking ahead, Balakrishnan said the company will focus on smaller acquisitions of 100-200 mln usd but pointed out Infosys is also capable of making big acquisitions.
Last year, the company bought Royal Philips Electronics NV's finance and accounting business process outsourcing unit for 28 mln usd and was rumoured to be interested in French IT services company Capgemini and the UK's Sage Group PLC.
For the quarter to end-December, Infosys' net profit rose to 12.31 bln rupees from 9.83 bln last year and 11.0 bln rupees in the preceding quarter. Revenues grew to 42.71 bln rupees from 36.55 bln last year.
The IT company's shares closed down 1.38 pct at 1,580.10 rupees on the Bombay Stock Exchange.
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