HCL ups fees to tackle rupee, no subprime hit

By Sumeet Chatterjee

BANGALORE (Reuters) - HCL Technologies Ltd is not seeing any impact on its business from the U.S. subprime mortgage crisis, and is able to get higher billing rates to offset a firmer rupee, a senior official said on Friday.

"Our exposure to mortgage is hardly anything," President Vineet Nayar told Reuters in an interview, adding offshoring momentum would continue even if the U.S. economy slowed down, because companies would still look to cut costs.

HCL, India's fifth-largest software services exporter, is looking to reduce its dependence on the United States, which accounted for about 54 percent of its revenue in the June quarter, and increase its focus on markets like Germany, Japan and China, Nayar said.

"About 50 percent should come from the U.S. and 50 percent from the rest of the world ... then you are not dependent on currencies, you are not dependent on slowdowns, not dependent on governments and visa regulations," he said.

Other Indian outsourcers have also said they intend to reduce dependence on the U.S. market, which accounts for over half the sector's revenue.

HCL, which is based on the outskirts of New Delhi, offers IT and back-office services to telecom, finance, travel and transportation, retail and media industries. In the June quarter, its net profit more than doubled, helped by new contracts and foreign exchange gains.

India's large pool of English-speaking workers and cheaper wages have helped attract outsourcing by overseas firms, but a stronger rupee is a concern for the export-driven sector.