Falling rupee to boost earnings of TCS, Infosys and other IT companies

The rupee’s sudden fall in the past few days may prove to be an added advantage for software exporters who are betting big on the improving outsourcing demand in the US and Europe. The rupee traded at 65 per US dollar on Friday.

This is 2.5% depreciation from the average rupee level of 63.4 at the end of the June 2015 quarter. Industry trackers point out that every 1% fall in the rupee may improve operating margin of software exporters by 30-50 bps.

Indian IT exporters are witnessing a strong traction in emerging areas of cloud computing, big data and analytics, which are often clubbed under the umbrella of digital solutions. Top players including TCS, Infosys and HCL Tech have reported a number of new orders of large, multi-year projects in this segment.

In addition, the demand has been picking up in the US and select pockets of Europe where Indian IT players are expanding fast.

Source: PTI

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