TCS to maintain exposure to financial sector
Tata Consultancy Services says it will not reduce its exposure to the troubled financial sector as the segment continues to grow, its chief operating officer said.
Despite concerns related to the turmoil in the U.S. credit markets, revenue from the sector has not fallen in previous quarters this year and the trend will continue, N. Chandrasekaran said at the Reuters India Investment Summit.
Chandrasekaran, a 20-year veteran of India's top software services exporter, said there is little indication as of now that clients' IT spending will be cut significantly, but a clearer picture will emerge by February or March when budgets are finalized.
However, the offshore component of IT budgets will definitely increase in the immediate quarters, Chandrasekaran said.
Chandrasekaran believes the company can still deliver margins in a rising rupee scenario, and said there was room for productivity improvements to offset the appreciation of the Indian currency.
Pricing, another key method to boost margins and offset currency fluctuations, is expected to rise 3 percent to 4 percent on renewed deals.
For new contracts, rates are expected to be about 5 percent higher over average billing rates.
The rupee has risen about 12 percent against the U.S. dollar this year, hitting a near-decade high of 39.16 in November.
Tata Consultancy, part of India's Tata Group that has diverse interests including steel and cars, is on track to hire 35,000 employees in the current fiscal year ending March 2008.
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