Steep fall in crude prices over the last six months is expected to impact discretionary spend of oil and gas industry in the near term, a top Wipro official said Friday.
"We expect the plunge in crude prices to impact capex and discretionary spend in the oil and gas industry near term," Wipro chief executive T.K. Kurien told reporters here.
Discretionary spend is the amount enterprises budget in a year on new projects resulting in more outsourcing of their IT services to global software vendors like Wipro as against non-discretionary spend made on operating and maintaining their existing IT infrastructure services.
Brent crude price plummeted to $46 per barrel this week from a high of $115 per barrel in June 2014 due to various global factors.
Revenue from global energy and utilities customers grew 13.4 percent in constant currency and accounted for 16.4 percent of the IT services revenue ($1,795 million)for third quarter of fiscal 2014-15.
Barring the oil and gas industry, the global software major is upbeat on demand environment for IT spend remaining steady with opportunities across key markets in North America and Europe.
"We see a recovery in demand in the retail and manufacturing sectors. Banking and financial services continues to demonstrate strong business demand, especially in Europe and India," Kurien said.
As a strategy, the outsourcing major remains focused on building its digital story to drive business transformation and leveraging open source to boost innovation and cost rationalization.
"We are driving impact in the open source space on a greater scale through industry-specific reference architectures, migration toolkits and by building a strong partnership ecosystem," Kurien noted.
The company won 10 deals during Q3 in the digital space spanning content, analytics and agile development of software to drive transformation and support its customers on their digital journey from conceptualization to implementation.
