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Information technology majors Infosys, Wipro and HCL have posted strong results, but analysts are still skeptical on whether the domestic IT industry will be able to sail through the US slowdown, maintaining its profitability and margins.
The results of the three firms were in line with market expectations.
"The results were positive and the markets started looking up. However, the industry might not be totally out of the woods yet. If they are able to post similar results for this quarter, we might be in a better position," Arun Kejriwal, strategist at research firm KRIS, told PTI.
Infosys posted a 9.2 per cent higher net profit in the quarter ended March 2008 at Rs 1,249 crore (Rs 12.49 billion) as compared with Rs 1,144 crore (Rs 11.44 billion) a year ago. Income for the quarter increased 20.4 per cent to Rs 4,542 crore (Rs 45.42 billon).
Analysts believe that the company was able to post a positive result mainly because it has been successful in moving its incremental business out of the US to Europe.
For some time now, the company is reducing its dependence on the US market. "Euro is a more stable currency and thus their pricing and margins were not affected," Kejriwal added.
However, companies and analysts are awaiting the results of the present quarter to better judge the impact of the US slowdown on the Indian IT industry.