Among Indian companies, Everest, HCL Technologies, Tata Consultancy Services and Infosys Technologies have significant exposure to Deutsche Bank.
HCL had a joint venture with the German bank to transform the latter's cheque processing operations late last year.
“Like Morgan Stanley or Bank of America, Deutsche Bank
is one of the big spenders for Indian IT firms.
With closure of capital market operations, the bank is shutting down 25 per cent of its business, which definitely will translate into some business loss for domestic IT firms,” said Pareekh Jain, an IT outsourcing advisor.
As part of a global restructuring, Deutsche Bank decided to slash 18,000 jobs. It plans to exit most of its investment banking activity, to enable focus on the corporate, private banking and asset management segments.
Indian IT firms
had also flagged softness in the capital markets and European banking business as they announced first quarter earnings.
As for Huawei, global provider of communications infrastructure and smart devices, it now has uncertain business prospects due to the US government's reservations regarding its operations. Cognizant and Tech Mahindra have meaningful exposure to Huawei. L&T Technology Services, Mindtree, Infosys, and Wipro have some level of engagement.
While slowdown in spending by marquee clients would mean business losses in the short term, analysts said the firms are better placed to overcome these. “Client-specific risks have always been around. But, most Indian vendors have been good at reducing excess exposure to a limited clientele,” said Hansa Iyengar, senior analyst at Ovum Research.