Midcap IT shares plunge on bleak outlook fears

MUMBAI: Shares of mid-cap software companies fell sharper than their frontline peers mid-way through the session on fears prospective clients would hesitate to outsource projects to smaller entities after the revelation of Satyam accounting fraud.

"Outsourcing of projects to India will be seriously affected and the biggest impacted would be the smaller companies," said a CIO with a private mutual fund.

A top official at a rival software company told a television channel, "Questioning by clients will heighten after this incident and there will be repercussions. At 1:10 AM, BSE's IT Index was down 230.57 points or 9.82% at 2,346.82, while the Sensex was at 9,696.23, down 639.70 points or 6.19%.