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PREVIEW-Indian IT firms' growth seen slowing on U.S. woes

Thu Apr 10, 2008 11:33pm EDT
 
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* What: Fiscal Q4 results from India's top software firms

* When: From Tuesday, April 15

* Profits seen up 2-23 percent; growth seen slowing

By Sumeet Chatterjee

BANGALORE, April 11 (Reuters) - India's top software services companies are set to report modest rises in profits compared with the boom times of recent years as a sluggish U.S. economy crimps outsourcing deals, and the sector's growth is set to slow further.

Investors will focus on new orders, pricing and hiring plans as the export-driven industry battles a fall in profit growth on growing evidence of a recession in the United States.

Helped by an army of English-speaking workers and cheaper wages, India's estimated $64 billion software services sector has thrived by winning deals from overseas clients, with the U.S. accounting for more than half of the sector's revenue.

"U.S. economic recession concerns are likely to lead to worsening business prospects for the Indian IT sector," Harit Shah, analyst at Angel Broking, said in a report.

"This is leading to continued negative sentiment for IT stocks. We believe that in the medium-term at least, this is unlikely to change."  Continued...

 

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