Though Cognizant Technology Solutions has overtaken Wipro's IT Services arm for the quarter ended June 30, analysts said that this will not make any major difference in terms of branding for either company.
Mr Dipen Shah, Senior Vice-President (Private Client Group Research), Kotak Securities, said that he didn't expect any major impact on either Cognizant or Wipro by virtue of Cognizant becoming the third largest company in revenue terms.
“If a client was getting some services from Wipro, can they move to Cognizant because it is now number three? Clients look at capabilities and there are several other factors rather than just being number three or number four,” he told
Before looking at the rankings of Indian IT services companies, one should realise that companies like Wipro and Cognizant are much smaller than their international peers, said Mr Karthik Ananth, Director, Zinnov Management Consulting.
“If you look globally, you have big players in the IT services segment, like IBM, HP, Fujitsu and others, who are all well above $10 billion. Compared to such companies, Cognizant and Wipro are small. Also, if you look at it, Cognizant's profits are flat and this causes me to wonder how long the price difference will continue to drive sustained growth.
“But for customers, it makes no difference if Wipro is number three or number four.” Mr Ananth said that financial investors and the media will, however, add pressure on Wipro.
Ms Srishti Anand, IT Analyst, Angel Broking, said that the change in ranking would not make any major difference. “IT business is very sticky in terms of clients. Just because Cognizant became number three doesn't mean that Wipro will lose out. If you want to look at numbers, Infosys' revenues are over $2 billion lesser than TCS, but this doesn't mean that Infosys' business is getting hampered.”