"The market is very large. It's still expanding fairly quickly. So, I don't think any of these companies are in danger," Nathanson says of the Indian companies. But "if I was an investor, I would be more concerned about margin pressures." Indian companies' operating margins currently average about 23%, far superior to the low-teen percentages of multinationals. And Satyam's margins have been improving as management has done a better job of running the business, investors say. Consequently, Satyam shares have climbed nearly 50% since the beginning of the year. But it's not too late to join the party, some investors say. "We still like it a lot," says Tom Kenny, senior portfolio manager with Munder Capital Management, which holds Satyam shares. "This is one if you look at the multiple, it's still a lot cheaper than other names out there on a P/E basis." Satyam now trades at 24 times fiscal '07 earnings, while peers trade at more than 30 times forward earnings. Still, Kenny adds, "wage pressure is something that all of these companies will have to deal with." It's also becoming increasingly difficult to get "great people" when the hiring is happening at such a dizzying pace, Nathanson adds. "When I think of competition right now I think the biggest issue is competition for talent," Nathanson says. "You're starting to see turnover rates similar to the late '90s in the U.S." Still, the underlying cost structure of India-based companies remains significantly lower than that of U.S.-based multinational IT services companies. Richard Schroth, a senior fellow with Katzenbach Partners, also believes that the multinationals already have so many moving parts that adding offshoring to the mix is likely to be challenging. And the multinationals still have far fewer employees in India than do the local companies. Accenture, for instance, now counts 16,000 employees in India -- roughly one-third of Infosys' workforce.