BANGALORE, 22 JULY 2009 - Wipro, one of India's largest outsourcing companies, reported a 3.3 percent dip in U.S. dollar revenue for IT services during the quarter ended June 30.
Wipro's revenue from IT services during the quarter was about US$1 billion, and the company said it expects revenue will be about the same during the current quarter. IT services accounted for 77 per cent of Wipro's revenue during the previous period.
Besides IT services, Wipro has an IT products business, and consumer care and lighting businesses.
Other large Indian outsourcing companies, including Tata Consultancy Services, the largest, also reported a decline in their U.S. dollar revenue during the quarter. India's second largest outsourcing company, Infosys Technologies, said earlier this month that revenue for its current fiscal year, which ends March 31, 2010, will decline by 3.1 per cent to 4.6 per cent compared to the previous year.
The results for these outsourcing companies look better in Indian rupee, because of the long-term depreciation of the rupee against the dollar and currency hedging, said Siddharth Pai, a partner at outsourcing consultancy firm, Technology Partners International.
For example, Wipro said that its revenue from IT services in the quarter ended June 30 was 48.27 billion [b] Indian rupees (US$1 billion at the exchange rate on the last date of the quarter), up by 10 per cent from the same quarter in the previous year.
However, the U.S. dollar revenue is the better indicator of the performance of Indian outsourcers because 70 per cent of their revenue is denominated in dollars, Pai said.
Earlier this month, the National Association of Software and Service Companies said dollar revenue growth from offshore outsourcing may drop to less than 10 per cent during the current fiscal year from 29 per cent two years ago.
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