After all the fiasco that unravelled on Wednesday around Satyam, there is a voice of consent that

Satyam might lose some of its top clients in the coming months. The company has General Electric, Nissan, Citi, ArcelorMittal among others as its clients. The company has around 600 clients from 66 countries. Moreover, the company?s top 100 clients contribute 80% of its revenue.

Industry analysts are of the opinion that there is every possibility of Satyam losing its big clients. There might also be a possibility that if the clients stay back there will be some kind of negotiation going on between the clients and its vendors regarding pricing and billing.

“Satyam is not in a position to negotiate. Hence there is every possibility that if the clients stay back with Satyam they will try to get into some kind of negotiation and put pricing pressure on the company,” commented an analyst from a top brokerage firm on conditions of anonymity. “As it is, clients have been putting pricing pressure due to the entire economic slowdown, thus Satyam might face it more post Wednesday?s revelation,” he added.

It?s been said that though there is a chance of clients walking away, no one will pull out suddenly. The clients will scrutinise and evaluate Satyam?s capability to provide services to them in the current scenario.

“It?s a very difficult situation. It?s true that Satyam?s contracts are in a jeopardy, however, it?s not easy for companies to change vendors overnight and shifting involves a lengthy process. Hence, if some company decides to move out it will take at least a couple of months,” said Kaustubh Dhavse, deputy director, ICT Practice, Frost & Sullivan, South Asia & Middle East. “However, we will see some harsh decisions taken by some companies,” he added.

“It?s a very bleak scenario for Satyam. Though we have not yet heard any major client walking away post Wednesday?s event, there is every possibility of clients moving away or not renewing their contracts with Satyam, which will be clearer in the coming weeks,” commented an analyst.

With the events unfolding other IT majors like Tata Consultancy Services, Wipro and Infosys are expected to be the biggest beneficiaries.

“It?s very natural that some of the biggest and well known IT companies will be reaching out to Satyam?s clients and will be in talks with them in the current situation,” commented Kaustubh.

Aftermath

• Might lose top clients

• Clients to scrutinise & evaluate Satyam’s capability