By DEEPALI GUPTA and ANKUR RELIA
MUMBAI -- Infosys Technologies Ltd. expects its clients' information technology budgets in 2010 to be unchanged or marginally lower, its chief operating officer said Tuesday.
"Past patterns suggest that when budgets are under pressure, clients do all kinds of things to get more with less, like outsourcing and offshoring," S.D. Shibulal told reporters on the sidelines of an industry conference.
India's software exporters have been hurt in the past few quarters because of the global economic slowdown, which led their customers to scrap or delay projects and seek lower rates for products and services.
Mr. Shibulal said the company's clients are saying the global economic recovery might be protracted, indicating that they would continue to be cautious on their spending.
However, he said clients have begun making decisions on their IT spending, underscoring optimism that the worst from the global economic crisis was over for the software outsourcing industry.
Mr. Shibulal expects Infosys--India's second-largest software exporter by revenue--to sustain margins in a narrow range, despite the investment it is planning.
"We are not looking to expand them (margins) significantly," Mr. Shibulal said.
In the July-September quarter, the Mumbai and Nasdaq-listed company's operating margin grew to 34.6% from 34.1%, helped by operational efficiencies and a fall in the value of the dollar against European currencies.
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