JOIN USAll certainly does not seem to be well with Indian information technology (IT) companies. After India’s largest software services firm Tata Consultancy Services (TCS) indicated that the fourth quarter is likely to be in line with last year’s trend, Bangalore-based Wipro has said that it is witnessing pricing pressure on new contracts.
“Pricing pressure has not been experienced on existing contracts. New contracts are seeing significant pricing pressure with parts of the deal being shrunk and becoming more competitive,” a Wipro official said at a recent investor conference held in Mumbai.
Meanwhile, at an analyst day in Bangalore recently, Wipro indicated that it is eyeing acquisitions as well as partnership opportunities.
“The company will look for mergers and acquisitions in insurance where its annual revenues are around $200 million-$250 million. Partnership opportunities exist in Japan with the bigger opportunity being Japanese companies working outside Japan, and on the product engineering side,” the company’s management seems to have indicated.
Margins are likely to be volatile in the short term while an opportunity for a positive bias in margins is likely in the medium term, according to the management.
The management also indicated that digital is an important segment and the company aims to make it as one of its top three service lines. In digital, the company is looking to pick up two-to-three areas where it can scale up.