TCS, Infy profits hit by rising rupee

Tata Consultancy Services Ltd and Infosys Technologies Ltd are among Indian computer-services providers whose earnings will be less than expected because of the Indian currency's appreciation, Morgan Stanley said on Friday.

The rising rupee is hitting software and BPO companies so much so that most companies might not be able to stick to their earnings guidance.

The issue stands crucial because 70 per cent of overall IT exports are earned in dollars. That means a 7-8 per cent rise will eat half a billion dollars of the industry's earnings.

Earnings on a per-share basis will be Rs 52.30 ($1.28) for the year ending March 31 for Tata Consultancy, less than a Rs 53.90 previous estimate, Anantha Narayan and Ashish Jain, analysts at Morgan Stanley, said on Friday in a note to investors.

Mumbai-based Tata Consultancy is India's largest software exporter.

Earnings for the full year will be Rs 81.10 per share for Infosys, India's second-largest software-exporter, Morgan Stanley said on Friday.

The previous estimate was Rs 83.60. The analysts also reduced their earnings-per-share estimates for Wipro Ltd and Satyam Computer Services Ltd.

The new forecasts are based on the assumption that the Indian currency will be at Rs 41 to the dollar, the analysts said.