The Hindu Business Line : Yuan revaluation: IT companies see no major impact

SOFTWARE firms do not foresee any major impact of China's move to revalue yuan, but said they prefer to wait-and-watch before stepping up investments in that country.

"We don't think this will impact in any manner," said Mr Suresh Senapaty, Chief Financial Officer, Wipro. With this latest move the Chinese currency has been made variable which is a positive sign, he said.

The appreciation of yuan against dollar is only two per cent and not a big change, Mr Senapaty said, adding that this was unlikely to have any impact. The attractiveness of China as an investment destination remains unchanged, he added.

Mr N. Ramachandran, CFO, iGATE Global, said there will be no impact in the short term of 3-6 months as the rupee is also moving in the same band. iGATE has a development centre in China to cater to its global clients in the region and also the Japanese clients.

"The behaviour of yuan needs to be observed over the next few months as China has not announced the basket of currencies with which it will peg yuan," he added.

However, with this latest development there is more potential for Japanese work to flow into China for Indian vendors, Mr Ramachandran said. The scope for expansion in China is always there but we prefer to wait-and-watch, he added.

The Chief Financial Officer of Tata Consultancy Services, Mr S. Mahalingam, said he expects all Asian currencies, including rupee, to appreciate by one per cent. TCS has hedged its dollar exposure to a large extent and therefore any impact due to fluctuation is limited, Mr Mahalingam said in a statement.

Mr Jerry Rao, Chairman, Mphasis, said on the whole it would be good for exports to start with. "Perhaps this could end the weakness and our margins will be a bit better off," he added.

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