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Article From Article Directory Database 锘? As valuations have factored in the pessimistic market sentiment, large-cap IT stocks appear to be unduly battered now. It has been a year since the dark clouds around the Indian information technology (IT) industry have been squaring in adidas nmd human race black for sale , and the storm in the form of a US slowdown appears to be knocking at the doors. Last fiscal, the rupee appreciated nearly 12 per cent. Next fiscal, software companies, which have their facilities located in software technology parks or outside special economic zones (SEZs), will be brought under the tax net ? a biting on net margins. As if this were not enough, the US is facing a slowdown, which many perceive may turn into a recession. Not surprisingly, many investors have already reduced their exposure to IT stocks, and valuations of software companies are close to the lower-end of their historical price-earnings multiples. Although it appears rational to expect IT budget cuts and a slowdown in Indian IT-companies' order flows, there is a strong view from the other side of the argument. Fortunately adidas nmd city sock black womens sale , the trend emerging from the guidance of global IT companies supports the more optimistic argument that a slowdown will prompt greater outsourcing, and in turn, higher volumes for large software companies. Examples include good results in technology consulting by Accenture, strong international growth guidance by IBM and Cognizant for 2008 of achieving 'at least 38 per cent' revenue growth. All these signs, put together, hint at a lesser than estimated fundamental deterioration of the sector. According to a Forrester Research market sizing forecast titled ?Global IT 2008 Market Outlook?, the US market is likely to be the laggard in the purchase of IT goods and services in 2008, while the Asia-Pacific will be the pacesetter. Forrester estimates the global IT purchases to equal $ 1.7 trillion in 2008, growing by 6 per cent, after a 12 per cent increase in 2007. Of this spending adidas nmd xr1 womens for sale , nearly $380 billion is likely to go toward purchases of software products and services ? an area where Indian IT companies are strong. The growth in budgets for software products is pegged at 8 per cent for 2008, down slightly from 11 per cent in 2007. The decline of the dollar is factored in, in these forecasts. Forrester expects Asia-Pacific, and the oil exporting area of Eastern Europe, Middle East, and Africa to be the main engines of growth in IT purchases this year. In a more recent report titled ?European IT 2008 market outlook?, Forrester suggests that the European IT market will grow faster than its US counterpart, with stronger investments in software than purchases of computer and communications equipment. The European IT spends is . |
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swisswatch
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