Following the global economic slowdown and the recession in U.S., the Indian IT companies are taking a different route to combat the slowdown. The largest revenue generator, the BFSI industry in the U.S. has not been able to properly allocate the IT budgets and due to this the Indian IT companies are afflicted. The prices have gone high and the margins are dipping.   
                  
The markets are down by 30-40% due to the liquidity crunch in equities and the Indian IT majors according to the company sources are looking forward to a good business opportunity as they have enough cash reserves.

The following are the cash reserves as reflected by the Indian IT majors:

•Tata Consultancy Services cash reserve: over Rs 4,400 crore

•Infosys Technologies : Rs 7,564 crore

•Wipro: Rs 1,540 crore

•Satyam Computer: Rs 4,817 crore

•and HCL Infosystems: Rs 2,516 crore.

In a major initiative to sustain the growth  and facing competition from countries like China and Phillipines, Indian IT companies are taking the inorganic route. Previously, the Indian IT companies were mainly engaged in body shopping. This inorganic route is the Marketing and Advertising way. For example, Infosys has plans to acquire U.K. based Axon group fro 407.1 pounds and boost its consultancy potential.  

It is a good time for the Indian companies to undertake mergers and acquisitions and for the software providers to acquire new technologies as observed by NASSCOM in 2008.
 

Jaya Sinha /ITvoir Network