Wipro says pessimism on Indian IT growth overdone

By Anshuman Daga

DAVOS, Switzerland (Reuters) - Worries over the impact of a U.S. slowdown on India's software services sector are exaggerated and Wipro's clients are showing no signs of reducing outsourcing, it's top official said.

"I don't think it's a situation of gloom for the industry. I think it's a situation of cautiousness for the industry," Azim Premji, chairman of India's third-largest software services exporter told Reuters in an interview.

"Don't get carried away. Run a tight ship. Have realistic expectations," Premji said during the annual meeting of the World Economic Forum in the Swiss resort of Davos.

Earlier this month, New York-listed Wipro reported a lower-than-expected 11 percent rise in quarterly profit, it's slowest growth in four years and said higher billing rates should help offset rising costs from wage hikes and a firm local currency.

Bangalore-based Wipro counts Cisco, Nortel and Credit Suisse among its clients.

Premji said Wipro's customers in the banking and financial services industry, hit by the subprime worries and wobbly markets, were likely to drive global outsourcing even more aggressively in an uncertain economic environment.

"Trying do drive more offshore work on IT is one fairly effective methodology of cost takeouts without much risk because they are used to it, they are used to their partners, they are familiar with the system."

"We are sitting pretty. I think global delivery companies such as ours will be the last affected," Premji said, echoing similar comments made by other leading Indian software firms.