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The deepening global slowdown threatens to hit the BFSI (banking, financial services and insurance) and telecom segments of IT and ITeS companies hard.
These segments have shown strain in the last year, with several companies either reporting flat or decline in income from these segments.
Wipro, Mahindra Satyam, iGATE have reported flat growth in the BFSI sector. For Wipro, the segment contributed 26.9 per cent to its revenues, which was the same as last year.
HCL's contribution from financial services came down to 24 per cent (26.2 per cent) for the quarter ended March 31, 2012. Its telecom vertical too contributed smaller pie (8.6 per cent) as against 10.3 per cent. Mahindra Satyam's contribution from BFSI was at 19 per cent (18 per cent) in 2011-12.
iGATE anticipates some delays with decisions on large projects with the larger banks.
Mr Raj Lanka, Senior Vice-President and Head of BFS Delivery, iGATE, said that the mid-tier segment opened up quite well in the BFS area.
“A lot of banks are showing interest in large data management initiatives because of strict regulatory norms in the US on data quality,” he said.
“India-specific concerns at Wipro and BFSI concerns in general may have pushed our expectation of shift in growth trajectory a couple of quarters ahead,” Mr Ashish Chopra, analyst at Motilal Oswal, said.
Mr B.V.R Mohan Reddy, Managing Director of Infotech Enterprises, said that the industry saw slackened demand in BFSI and telecom sectors.
Polaris said that these two markets hold the key as financial institutions spent five per cent of their revenues on technology as against two per cent by their peers in emerging countries.
Infosys has seen a growth in financial services. Last year, this segment clocked revenues of Rs 11,830 crore, a 19 per cent growth over previous year.
“However, banking clients are evaluating their IT spends every quarter in the backdrop of volatility,” according to Mr Ashok Vemuri, Head of Americas and Global Head of Manufacturing, and Engineering Services, Infosys.
(With inputs from Venkatesh Ganesh in Bangalore, Ronendra Singh in New Delhi and T.E. Rajasimhan in Chennai)
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