Rupee Rise To Affect IT Cos'' Profitability: Nasscom

Software industry association Nasscom said profitability of IT companies will be affected by the recent rupee appreciation and needs to be checked in time.

Nasscom Chairman Kiran Karnik said, It is a case of too much too quick. An 8-9 per cent rise in the value of rupee is definitely a cause of concern. The impact will be felt on the bottomline of IT firms.

The topline, however, would continue to be strong since margins are still higher, he added. industry is ready for small appreciation like 1-2 per cent in the rupee but the kind of increase witnessed in the last few months is certainly very harmful for small IT companies.

Asked if this would anyway affect the overall growth guidance, he said Nasscom is yet to release its growth guidance for 2007-08 and we hope dollar would stabilise to a higher level in the near future.