HOME   
   NEWS   
   BUSINESS   
   CRICKET   
   SPORTS   
   MOVIES   
   NET GUIDE   
   SHOPPING   
   BLOGS  
   ASTROLOGY  
   MATCHMAKER  


Search:



The Web

Rediff








Business
Portfolio Tracker
Business News
Specials
Columns
Market Report
Mutual Funds
Interviews
Tutorials
Message Board
Stock Talk
Press Releases



Home > Business > PTI > Report

IT cos will earn lower margins: Nasscom

May 23, 2003 18:38 IST

National Association of Software and Services Companies said on Friday that Indian software firms will earn "lower margins" in the next two to three years due to stepping up of operations of global IT majors in the country and customers offering large contracts at lower rates.

"The margins will come to the 'teens' within two to three years. There is no way you can have high margins of 30 per cent any more," Nasscom president Kiran Karnik told reporters in Bangalore.

He said factors that were responsible for projected decline in margins of domestic firms were stepping up of operations of the world's largest IT firms like IBM and Accenture in India and customers becoming "smarter" in offering large and long-term contracts at reduced rates.

"Customers are offering large contracts like $30 million to the companies and the deals are becoming cheaper," Karnik said, on the sidelines of the conference on 'Media, Information Technology and Grassroot development,' organised by the Press Institute of India.

While IBM, with over 4,700 employees in India, has said it aims to grow in "hundreds", Accenture plans to double its employees for its call centre and software development center in Mumbai and Bangalore to 2,500 in two years and compete with Indian IT majors in rates.



© Copyright 2003 PTI. All rights reserved. Republication or redistribution of PTI content, including by framing or similar means, is expressly prohibited without the prior written consent.





Article Tools

Email this Article

Printer-Friendly Format

Letter to the Editor



Related Stories


IT sector suffers growing pains

IBM to expand base in Karnataka

IT exports from Bangalore dips



People Who Read This Also Read


WB to take up visa curbs issue

Petro prices may be cut further

Ajit Singh quits







HOME   
   NEWS   
   BUSINESS   
   CRICKET   
   SPORTS   
   MOVIES   
   NET GUIDE   
   SHOPPING   
   BLOGS  
   ASTROLOGY  
   MATCHMAKER  
© 2003 rediff.com India Limited. All Rights Reserved.