Indian IT firms, especially in the mid-tier segment, have seen a rise of private equity firms placing stakes on them. While faster technology at mid-size IT services companies have attracted PE firms such as Blackstone, Carlyle, ChrysCap, Bain Capital, The Baring Asia and others to invest in the sector; PE-backed companies have seen faster growth at a time when their large listed peers slowed down due to uncertain market.
When Vishal Sikka took over at Infosys he was prescient about automation taking away jobs and clients shifting investment dollars into newer digital technologies.
India’s largest IT firm Tata Consultancy Services has appointed veteran Ravi Viswanathan as its global chief marketing officer. Viswanathan’s appointment comes at a time when the company, like its peers, is battling not just increasing competition but also heightened protectionism in its largest market — US. Viswanathan, who will be in charge of the marketing and communications functions and based in Chennai, will directly report to new CEO Rajesh Gopinathan.
On May 02, Infosys, India’s second largest information technology (IT) company, announced that it will hire 10,000 American workers over the next two years. Three days later, on May 05, Nasdaq-listed Cognizant Technology Solutions, which has a large presence in India, also revealed plans to significantly ramp up hiring in the US. if and when they do end up attracting talent, Indian IT companies may have to pay through their nose for it.
India’s famed multi-billion dollar information technology (IT) industry has been facing challenging times over the past 6-12 months with top-notch IT companies already facing earnings pressures in recent quarters due to tough business environment prevailing in their most lucrative US and European markets.
With President Donald Trump making it abundantly clear that he will curb immigrant work visas to protect domestic jobs, technology outsourcing firms such as Tata Consultancy Services, Infosys and Wipro are focusing on localisation and hiring more Americans to serve their clients in the U.S.
On May 2, 2017 Infosys announced plans to hire 10,000 American workers over the next two years.
At Greyhound Research we believe, steps such as these by IT Services Providers eloquently tell a tale of the pressure they are experiencing under the new Trump administration.
The software industry is facing mounting challenges as countries from Australia to the United States have moved to tighten work visas to limit the influx of foreign workers.
Infosys has deployed its artificial intelligence (AI) platform ‘Mana’ to process contracts for a bank in Asia that typically needed a team of 10-15 dedicated lawyers.
Cognizant, the New Jersey-headquartered software services company with most of its operations in Chennai, is likely to lay off 6,000-10,000 “ redundant and non-performing” employees.
Every shareholder is happy when a share buyback is announced. Some even pressure companies to repurchase shares because they see no value in remaining shareholders of the company. And sometimes it is the management that wants to be free of shareholders. But to what end?
The Indian software services companies will breathe a sigh of relief as the Indian ministries, authorities and industry lobby had a dialogue with a visiting eight-member US delegation headed by Congressman Bob GoodLatte, on the ongoing concerns of H1-B visa holders.
India’s largest software exporter TCS said it will consider a share buyback at a board meeting next week.
It may not be a good time to be a techie in America. Correction: It may not be a good time to be a non-American in Trump’s America.
On 31 January 2017, an announcement impacting H-1B visa programme has been made by the US House of Representatives making it difficult for companies in the US to employ skilled foreign workers. Among other things, the minimum wage requirement of H-1B visa holders has been more than doubled to USD 130,000. At Greyhound Research we believe this is a significant announcement by the newly appointed Trump administration. While changes were expected under the new President, the suddenness and the order of the announcement has surely caught IT Services Providers across the globe by surprise.
India’s information technology (IT) sector will face temporary setback to move workers from India to the US with the bill introduced in the US House of Representatives that mandates minimum wages of H1B visa holders at $130,000, double the current limit.
Indian engineers have for long viewed the US as the land of El Dorado with its promise of riches — professional and personal. But they are now a deeply worried lot as nationalist rhetoric turns shrill in Donald Trump’s America.
New US President Donald Trump’s ‘Buy American-hire American’ rallying cry has put the USD 150- billion Indian IT industry on edge, which is in wait-and-watch mode to see how the new administration evolves policies around outsourcing and movement of skilled workers.
Hoping for a “business-friendly administration”, Infosys chief Vishal Sikka says Trump himself is an entrepreneur and a business leader and therefore, he “expects that this will be the case where business and innovation friendly regime.”
Rajesh Gopinathan, who will take over as the CEO of Tata group crown jewel Tata Consultancy Services on February 21, has big shoes to fill. But experts believe the 46-year-old will bring freshness into the company at a time when technology trends are shifting at an unprecedented pace.
The Donald Trump administration which will take charge on 20 January in the US has announced that it will push for legislative measures to curb misuse of H1-B and L1 work visas significantly used by Indian IT professionals.
Of all the possible candidates, the credentials of TCS’ N Chandrasekaran was hard to be ignored for panel.
“2017 is going to be a volatile year for the Indian IT industry,” says Sanchit Vir Gogia, Chief Analyst and CEO, Greyhound Research. “The pace of technological changes is very high and it will lead to substantial job cuts. The companies will try to be a lot leaner,” predicts Gogia.
Indian IT services companies have been facing competition from upstart players with highly specialised skill sets based in advanced markets, especially in areas such as cloud services and analytics. The cash-rich Indian IT companies are responding to this by acquiring companies overseas and thereby enhancing capabilities. Wipro spending nearly $1 billion in acquisitions last year is a case in point. In 2017, we are likely to see big boys of the Indian IT industry loosening their purse strings to make large acquisitions. “They will look at companies with sizeable revenues,” says Gogia.
On December 31, 2016, Infosys announced a sudden exit of its General Counsel and Chief Compliance Officer, David Kennedy. While no reasons have been cited by the company, per the terms of exit, Kennedy will receive aggregate severance payments of US$ 868,250 along with reimbursements for COBRA (insurance) continuation coverage over a period of 12 months.
Winter has set in, and yet, the biting icy winds do not stop New Yorkers from getting to work. At Liberty Street, inside the Times Inc. office, there are a couple of financial service providers and media companies talking about digital transformation.
On Dec. 8, thousands of supporters in a packed hall in Des Moines, Iowa vociferously cheered President-elect Donald Trump as he reiterated his campaign promise to bring back home millions of jobs that Americans have lost to foreigners.
India’s software exporters seem to be the new incumbents in the global technology outsourcing space. In the next two years, clients such as BNP Paribas, Procter & Gamble, Johnson & Johnson, Citigroup and DuPont will look at their existing contracts and ask global information technology (IT) services firms to bid for them.
Reliance Industries is gearing up to enter the software services business and plans to take on India’s IT giants, as the energy-to-telecom conglomerate taps the growing potential of the industrial internet.
The bitter boardroom battle at Tata Sons is unlikely to impact operations of the USD 100-billion conglomerate’s crown jewel TCS, but if its chief N Chandrasekaran is elevated to the top at the group level, it could be a blip on the firm’s business, say analysts.
Republican candidate Donald Trump just two days ago during his election rally had strongly criticized technology giant IBM for laying off 500 staffs working at Minnepolis located on mid-western US state of Minnesota. During his rally, Trump also had said that if he gets elected, his government will not allow companies like IBM to move jobs outside the US and they would have to pay 35 percent tax for developing products outside the US.
The recent change in UK visa rules announced today which created a panic among Indian IT professionals might not have a significant impact, according to experts in the industry.
The UK government has decided to increase yearly salary threshold for technology professionals applying for visa by 44 per cent. Under the new visa rules announced last evening by the UK Home Office, anyone applying after November 24 under the Tier 2 intra-company transfer (ICT) category would be required to meet a higher salary threshold requirement of £30,000 from the earlier £pounds.
The search for a new chairman of Tata Sons following the ouster of Cyrus Mistry has thrown up quite a few names. The high-profile names include Indra Nooyi, the head of PepsiCo Inc, Arun Sarin, the former head of Vodafone Group, and Noel Tata, chairman of the Tata retail unit Trent.
The Royal Bank of Scotland’s decision to shelve its IT deal with Infosys may have hit the Indian company’s stocks on Tuesday but the development could have a ripple effect on many such projects for the IT sector and result in more ramp downs.