Bangalore: IT companies have reported better business in the past year, despite the economic topsy-turvy in the U.S. and Europe, reports Times News Network.

According to industry analysts, IT companies have not gained much in terms of dollars last year but their income in terms of rupee has been substantial. Mark Mobius, a leading global investor, in an interview with IBN Live, said that a weak rupee makes India a strong contender in the world market, especially in the domain of exports.

Indian IT companies will benefit from a weak rupee this year, though the demand for IT services from India has diminished to an extent. According to BPOWatch Indian IT companies will register an increase of about 23 percent in their income by the end of Q-3 in 2012.

Religare Institutional research data revealed a 17.8 percent increase in the profits of major IT firms in Q-3. Prominent Indian IT hubs will exhibit good growth this year, even tier-I IT firms. Profitability of major IT firms will be – Infosys – 23.4 percent, Tata Consultancy Services (TCS) - 25.1 percent and Wipro – 12.8 percent. Year-on-year sales increase of these 3 firms will be around 31.3 percent.

TNN quoted Credit Lyonnais Securities Asia (CLSA), a prominent broking house, "Current market dollar-revenue forecasts continue to face downside risks ahead. However, a benign currency environment should ensure solid margin defense ahead and Infosys is best placed to capitalize on the weak currency (rupee)." Infosys will declare its quarterly earnings on January 12, HCL and TCS on January 17 and Wipro on January 20. Edelweiss Capital said that the Quarter-on-quarter (Q-o-Q) revenue rise will be about 2 to 3 percent, as compared to 4 to 5 percent in 2011 for the period of October to December.

BPOWatch also states that if the U.S. economy resuscitates this year, it will benefit the top-line of IT firms. Bottom-line of the firms will benefit from a weak rupee. Cost of employees may strain the bottom-line but firms can get good business from Asia, Australia and Africa but not much from Europe and the U.S. However, a weak rupee aiding IT firm is only for a short period of time. If the rupee weakens further, a price battle may ensue among IT firms, leading to an unstable IT market.

Investors are eagerly awaiting the Q-3 results of the best IT firms in India. Their disclosure will decide as to which company has performed well, despite economic ups and downs in India and the world. It will also decide as to which firm will top the IT services field.