IT demand in US to improve after elections, says Azim Premji

Wipro, India’s third largest IT services company on Friday said the demand for IT outsourcing services from the US is expected to improve after the presidential elections even though the quality of demand would be much different from the earlier times.

Azim Premji, chairman of Wipro who was in the US recently as a part of the 'business council of America' that comprises of a group of CEOs belonging to Fortune 500 companies, said while he found their mood in terms of economic and employment growth is muted, "the demand or IT services is still holding out".

"It is not the bumper demand that was there three years back, but it is still reasonably strong,” he said.

Premji said after the elections are over, the demand is expected to pick up in the US. “You will see little more demand pick-up, not immediately after the elections, but in about two to three months after the election results are known, irrespective of the outcome of the elections,” Premji added. The US is the largest market for the $70 billion Indian IT services industry from where they derive about 60 per cent of the overall revenues.

For the quarter ended September 30, 2012, Americas contributed around 51.5 per cent to Wipro's overall IT service revenues of Rs 8,373 crore. Wipro's US business grew 1.3 per cent sequentially in the quarter.

Premji said the kind of demands that are expected from the US would require the IT service providers 'to be much more proactive in terms of quality of selling.' "But if one has their sales and top management act right and domain act right, then it’s possible to sit down with the CIOs, COOs, CFOs and CEOs and suggest solutions to them, which can result in more profits," he said.

"One has to be a co-partner with them (clients) in bearing some of the variability of their demands," he added.