The Hindu Business Line : IT cos may report strong numbers in Q2

Driven by a robust growth in business volumes, major information technology services firms are seen reporting strong numbers for the second quarter ended September 2006.

Seasonally, the second quarter is considered to be the strongest quarter for IT companies.Infosys Technologies is set to announce its results on Wednesday.

Analysts expect companies such as Infosys Technologies, Wipro Ltd and Satyam Computer Services to exceed their own guidance and post a double-digit sequential revenue growth for the quarter.

Infosys has guided quarter-on-quarter (QoQ) revenue growth of 10.9 per cent for Q2, while Wipro and Satyam had said their revenues would grow by 9 per cent and 8 per cent respectively.

Infosys and TCS, which saw their margins impacted by wage hike and visa costs in June quarter, may see a bounce-back in their operating margins during the September quarter.

But companies such as Wipro, Satyam and HCL Technologies, which had effected a wage hike during the September quarter may see some impact on their margins.

Further, a slightly weaker rupee during the quarter would also help boost growth of these firms.

On a quarter average basis, the rupee has depreciated 2 per cent quarter on quarter against the dollar, 3.5 per cent against the euro and 4.7 per cent against the pound.

On an end-of period basis, the rupee has been flat against the dollar, down 1 per cent against pound and up 1.2 per cent against the euro.

The pricing environment, analysts said, would largely remain stable with vendors seeing selective increases from both new and existing customers.

However, analysts expect modest earnings guidance from the companies for the December quarter considering the fact that it has fewer working days, which could impact the billings.

Moreover, management comments on the possible impact of the slowdown in the US would be keenly watched, they said.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
N-E monsoon likely to set in by weekend

Ericsson emerges lowest bidder for BSNL cellular tender

Allegations on tendering: PMO seeks DoT response

`Indian HNI base growing rapidly'

Indo-Thai pact: Duty cut on 3 products

Pacts for 8,000-MW power projects signed

IT cos may report strong numbers in Q2

Cops on home loan trail!

Small-cap cement stocks do well

Trading in corporate bonds: RBI upsets SEBI plans

West takes a new fancy to lanterns