‘IT Exports May Grow 13-15% on Global Pick-up, Shift to New Tech’
Software industry lobby Nasscom forecast that exports in the IT sector will grow 13-15% in FY16, helped by improving global economic activity and a move to new technologies such as social networks, mobile applications, analytics and the cloud (SMAC). The newer technologies — which collectively go by the acronym SMAC — already contribute 5-10% of the industry’s revenue. “So far, the labour arbitrage advantage has helped the industry, but I think the next stage of growth will come from innovation and entrepreneurship.” The total SMAC opportunity was $164.1 billion (.`10.2 lakh crore) in 2013, according to Nasscom. That figure is expected to grow 75% to $287.3 billion (.`17.8 lakh crore) in 2016. But industry trackers are not enthused. “The way they look at this number is that this is nothing to cheer too much about. Because the market is building in something like 16- 17% growth for the bigger companies like TCS and Cognizant. And even for Infosys and Wipro the growth expectations are about 13-14%. So, logically, since the large companies account for most of the growth, the industry should grow at a little above 15%.” Others expects 12-16% growth in FY15 from the tier-1 IT players. This fiscal, Nasscom expects the industry to grow 13%, the mid-point of its expected range of 12-14%. Domestic growth, however, for last year was expected to be 10%, below expectations. “Economic uncertainties, slowdown in decision- making, inflation, rupee volatility the 2014 elections and other factors impacted discretionary IT spend for both the government and enterprises in last FY.” It is reported that the industry body is going to make a strong push in 2015 to convince the government to modify procurement procedures to make the process easier for IT firms which have stayed away from government contracts in recent months. For FY15, the domestic market is expected to grow 9-12%. While a focus on emerging markets like India is key to future growth, Nasscom also expects the industry to move to a new mode — IT Industry 3.0. The new model would require a focus on intellectual property rather than capacity, more local presence, moving to new markets, prizing skill over scale and targeting a new set of customers. “The lively startup ecosystem is infusing new energy and fuelling innovation. Collaboration between SIs (system integrators) and startups is beginning to happen.” Indian IT players like Zensar have been tying up with startups to provide solutions around mobility, analytics and social media and further planning to tie up with as many as 15 startups.
It will drive the economy from 2015 to 2025.
Happy Investing
Source : EconomicTimes
Software industry lobby Nasscom forecast that exports in the IT sector will grow 13-15% in FY16, helped by improving global economic activity and a move to new technologies such as social networks, mobile applications, analytics and the cloud (SMAC). The newer technologies — which collectively go by the acronym SMAC — already contribute 5-10% of the industry’s revenue. “So far, the labour arbitrage advantage has helped the industry, but I think the next stage of growth will come from innovation and entrepreneurship.” The total SMAC opportunity was $164.1 billion (.`10.2 lakh crore) in 2013, according to Nasscom. That figure is expected to grow 75% to $287.3 billion (.`17.8 lakh crore) in 2016. But industry trackers are not enthused. “The way they look at this number is that this is nothing to cheer too much about. Because the market is building in something like 16- 17% growth for the bigger companies like TCS and Cognizant. And even for Infosys and Wipro the growth expectations are about 13-14%. So, logically, since the large companies account for most of the growth, the industry should grow at a little above 15%.” Others expects 12-16% growth in FY15 from the tier-1 IT players. This fiscal, Nasscom expects the industry to grow 13%, the mid-point of its expected range of 12-14%. Domestic growth, however, for last year was expected to be 10%, below expectations. “Economic uncertainties, slowdown in decision- making, inflation, rupee volatility the 2014 elections and other factors impacted discretionary IT spend for both the government and enterprises in last FY.” It is reported that the industry body is going to make a strong push in 2015 to convince the government to modify procurement procedures to make the process easier for IT firms which have stayed away from government contracts in recent months. For FY15, the domestic market is expected to grow 9-12%. While a focus on emerging markets like India is key to future growth, Nasscom also expects the industry to move to a new mode — IT Industry 3.0. The new model would require a focus on intellectual property rather than capacity, more local presence, moving to new markets, prizing skill over scale and targeting a new set of customers. “The lively startup ecosystem is infusing new energy and fuelling innovation. Collaboration between SIs (system integrators) and startups is beginning to happen.” Indian IT players like Zensar have been tying up with startups to provide solutions around mobility, analytics and social media and further planning to tie up with as many as 15 startups.
It will drive the economy from 2015 to 2025.
Happy Investing
Source : EconomicTimes
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