Top 5 IT firms garner major market share during slowdown

By siliconindia   |   Friday, 23 May 2008, 17:40 IST
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Mumbai: If the fourth quarter FY08 results of IT companies are any thing to go by, it seems that customers preferred to stick to the top five Indian IT service providers during the slowdown. A study of the quarterly results of 100 Indian IT firms says that big five increased their share in total software revenues compared to the corresponding quarter of the previous year. However, this expansion came at a cost of lower profitability, reported The Economic Times. The big five includes TCS, Infosys Technologies, Wipro, Satyam Computer Services and HCL Technologies, all of which are listed on the Indian bourses. For the March 2008 quarter, the top five firms contributed 73 percent to the total revenue of the 100 IT companies that declared results, indicating an improvement of 100 bps over the March 2007 quarter. Between the third quarter of FY06 and the fourth quarter of FY07, the share of the big five had steadily declined, dropping from a high of 73.8 percent to 72 percent as small and mid-tier players benefited from the spurt in global outsourcing. This trend continued until the June 2007 quarter, the period when the Indian IT sector started feeling the adverse impact of factors like sharp appreciation in the rupee against the dollar, slowing US economy and the crisis in the international mortgage markets.