Category Archives: Media Mentions – Greyhound Knowledge Group

Asia-Pacific, Middle East new focus areas for IT services firms #Press #Media #Mint

Indian software services exporters have begun sharpening their focus on countries like Japan, China, Malaysia, Australia and those in the Middle East, given the growth potential of these markets.

In the June quarter, the top five Indian software services exporters posted an average growth rate of 11-15% in Asia-Pacific and other emerging markets.

Growth from the Asia-Pacific region for India’s largest information technology (IT) services company, Tata Consultancy Services Ltd (TCS), was up 34.9% from a year ago and that from the Middle East rose 20% in the same period. Wipro Ltd, which has been in the Middle East for over a decade, saw its Middle East and India business grow 13.8% in the June quarter from a year earlier.

For Tech Mahindra Ltd, India’s fifth-largest software services exporter, the Middle East is a priority due to government-led information technology initiatives, like the recent eight-year engagement it signed with the Dubai Economic Council to provide solutions to make Dubai a “smart city”. Tech Mahindra also has the contract to provide data solutions to power the FIFA World Cup 2018 in Qatar.

The move to emerging markets is logical, given the high growth potential in these regions, even though it is on a lower base, say experts.

South East Asia’s competitive and rate-sensitive market allows for smaller deals, especially from countries like Taiwan, Hong Kong, Singapore and Malaysia, which are of particular interest to mid-tier firms, said Ravi Menon, IT analyst with Centrum Broking Pvt. Ltd.

Sangeeta Gupta, vice-president of software lobby body Nasscom, said that exploring business in countries like Japan, Korea, Indonesia, China and continental Europe makes sense “as 80% of incremental revenue is projected to come from these markets by 2020”.

Sid Pai, partner at research and consulting firm, Information Services Group (ISG), pointed out that while developed markets like the US and Europe are growing a mere 2-3% annually, markets in continental Europe like France, Germany and the Nordics are largely underpenetrated but have an addressable market opportunity of 30-40% per annum.

“Other emerging markets in Asia-Pacific like Japan, China and India, which currently contribute barely 5% to revenues of IT services players, have a potential to grow by 30-40% per annum as well,” he said.

Sanchit Vir Gogia, chief analyst and chief executive of Greyhound Research, agreed that the Asia-Pacific region “will remain the fastest-growing emerging market, especially Association of Southeast Asian Nations (Asean) and China, which offers a lot of sophistication in terms of varied deals”. However, growth in the Middle East, he said, was restricted to regions like the UAE, Qatar, Oman and Egypt.

According to Cathy Tornbohm, vice-president of research at research firm Gartner Inc, “clients need a range of delivery locations for people-based processes. This is for proximity for ease of visiting sites, cultural fit, languages and time zones”.

For instance, global business process management firm Aegis Ltd, a part of the Essar group, which recently sold its American unit Aegis USA to Paris-based business process outsourcing firm Teleperformance for $610 million, said it would use some of the earnings for acquisitions in Korea and Japan.

The move, according to Sandip Sen, global chief executive of the company, “is to complement its Malaysia business, which will be the hub of its operation in South Asia, after the acquisition of Malaysia-based Symphony BPO in March”.

The Middle East market “offers opportunities of an emerging market as well as an advanced market, which is rapidly deploying world-class technology, comparable to the developed world”, said Kamal K. Singh, founder and chief managing director of Rolta India Ltd, a software engineering firm.

About 12-15% of Rolta’s revenue comes from emerging markets, and “most of the contracts we win here are with government and public-private partnership projects”.

Meanwhile, even the Indian government, said R.S. Sharma, secretary of the Department of Electronics and Information Technology “is seeking to identify new non-English speaking markets, like Africa, Latin America, China and South East Asia as it looks to promote small and medium size enterprises in the segment”.

He added that the government has formed an expert council, which has members from different industry lobbies, to figure out what could be done to extend India’s presence in these markets.

Source: Mint

Infy: Analysts question timing of letter #Press #Media #HinduBusinessLine

Balakrishnan declines to comment; Pai out of the country

With first employees’ nod

The recommendation, which was reportedly meant to reinstate losing investor confidence, was also signed by DN Prahlad, one of the first employees of Infosys.

Rumours of a buyback first surfaced before Infosys announced the appointment of Vishal Sikka, two days before the company’s AGM on June 14.

“We were inundated with calls by media asking us about the buyback. And not surprisingly, the timing of this letter to the board happened on July 29, just one day before the EGM on July 30 where Vishal Sikka’s appointment was formalised,” said an Infosys spokesperson.

She further added that a long-term investor who always attends the company’s AGMs and EGMs, this time around pointedly told the board members during the EGM that they should consider buyback of shares.

While Pai could not be reached as he was out of the country, Balakrishnan said he did not want to comment on why he had made such a recommendation to the board.

Not driven by noble cause

“Why didn’t either Bala or Pai suggest buybacks when they were CFOs of the company, when they could have easily done it. Their motivations today are clearly not driven by the noble cause of adding to shareholder value,” said Sundararaman Vishwanathan, Manager Consulting, Zinnov, an advisory firm for global businesses. Large institutional investors such as UBS, Fidelity and Temasek are certainly not in a hurry to sell out, as they are invested in Infosys for the long term, he elaborated.

A corporate governance advisory firm in which former Infosys CFO Mohandas Pai is an investor said the IT major should not give any special consideration to the letter written by the former finance heads of the company. “I think Infosys should treat the letter written by former CFOs of the company as a request from investors than for the positions they held there,” Sriram Subramanian, Founder and Managing Director of InGovern Research Services said.

Failed to articulate strategy 

Subramanian pointed out that it was unusual for a company which has no debt to sit on such a huge cash pile.

He said one might question the timing of the letter but the fact was that Infosys had failed to articulate a strategy in this regard.

The whole premise of former Infosys CFOs writing a letter to the board asking for a buyback of shares to boost investor confidence is flawed and led by personal motives and emotions, observed Sanchit Vir Gogia, Chief Analyst & CEO, Greyhound Research.

Daljeet S Kohli, Head of Research, IndiaNivesh Securities, feels this is a case of pressure tactics to force Infosys to do something about the cash pile it has been sitting on for the last four years.

“A company would resort to buyback as the last resort only when it has exhausted every other option to grow,” he added.

Source: The Hindu Business Line

HCL Tech bags $250-m deal from Alcatel-Lucent #Press #Media #HinduBusinessLine

HCL Tech has won a $250-million deal from French telecom major Alcatel-Lucent.

The deal involves HCL taking up complete R&D work of Alcatel-Lucent in technologies such as 2G and 3G.

Further, HCL will co-create intellectual property and help the French telecom major innovate in these areas. When contacted, an HCL spokesperson confirmed the development. The deal comes a day after Alcatel-Lucent in its second quarter earnings told analysts that its short-term results would be ‘lumpy’, after its brief comeback to profitability in the preceding quarters that resulted in deal wins from Vodafone and LTE investments in China.

“Alcatel-Lucent is trying to steady its ship and clearly this effort points to significant cost savings and faster time to market,” said Sanchit Vir Gogia, analyst with Greyhound Research.

For HCL, this deal follows a spate of multi-million dollar deals that the company bagged in the 2014 fiscal.

According to Prabhudas Lilladhar IT analyst Shashi Bhusan, HCL signed 14 multi-million dollar, multi-year deals that were estimated to have total contract value of $2 billion. However, most of these deals have been won in the area of IT infrastructure management, which involves taking over of IT assets of global pharmaceutical, financial institutions or telecom companies and running them.

This is the first big ticket deal that the company has won in the area of engineering R&D, which contributed 7.4 per cent to its overall revenues, according to company data.

Source: The Hindu Business Line

India opens up to operating system Ubuntu #Press #Media #EconomicTimes

India is the fastest growing market for open source operating system Ubuntu, helped by tie-ups with top PC vendors and the increasing adoption of cloud-based applications in the country.

The Linux-based operating system grew 50% year-over-year in India. Canonical, the company behind Ubuntu, has partnered with Dell and HP to bundle the OS with certain models of their laptops offered in India.

“India is the fastest growing market for us with great stickiness and adoption of Ubuntu. It is definitely one of our key focus markets globally,” said Prakash Advani, regional manager for Asia Pacific at Canonical.

As enterprises move more to the cloud, Ubuntu becomes more relevant for them. “People are switching to Ubuntu as it is simpler to understand. It is also easier to use and install than other OS,” said Sanchit Vir Gogia, chief analyst and CEO of Greyhound Research.

Online directory service JustDial is among the early adopters of Ubuntu and has 4,500 desktops running on the operating system currently. “Since our CRM (customer relationship management) is browser-based,” said Mahesh Pawar, head of IT and telecom at JustDial. “We chose Ubuntu because it is stable, doesn’t require anti-virus patch management administration like Windows, is highly secure and cost effective.”
To ensure that users are comfortable, the company has started conducting Ubuntu basic awareness training. “If users still insist for Windows operating system, then we educate those users how they can use Ubuntu effectively,” Pawar said.

Bangalore-based Narayana Hrudayalaya, a low-cost and high quality healthcare service provider, is also trying to move from Windows to Ubuntu to cut costs.

“We are trying out Ubuntu. We aren’t against licenced technology but we want to use it sparingly.

“We are trying to make critical applications work on open source operating systems,” Srikanth Raman, CIO at Narayana Hrudayalaya, said.

In the past couple of years, Ubuntu has been able to penetrate into the government and education sectors with some large deals such as the 15-lakh laptop deal with the Uttar Pradesh government, a 61,000 laptop deal with the University of Delhi and a 28,000 laptop deal with Assam’s Amtron.

Ubuntu has also seen growth in the consumer segment with users opting for cheaper versions of laptops that come pre-installed with it.

“Ubuntu’s partnership with Dell was a crucial one. With laptops being pre-installed with Ubuntu and sold in numerous Dell stores, proved to be beneficial in increasing sales,” analyst Gogia said. In 2012, Dell joined hands with Ubuntu and announced that 850 stores in the country would sell laptops pre-installed with the OS. Dell currently offers most of its Inspiron and Vostro ranges with Ubuntu.

“Our retail business has been growing quarter-on-quarter. While we don’t have a more detailed breakup of numbers, in that scenario Ubuntu has correspondingly grown as well,” said Alen Jose, Consumer & Small Business Product Lead, Dell India.

Source: The Economic Times

马恒达科技公司第一季度利润下降 8% #Press #Media #Cailiao

马恒达科技公司,印度第五大软件服务公司,表示第一财季盈利下降8%,错过分析师的预期,较高的签证和雇佣成本。净利润下降至631亿卢比,在三个月截止六月三十日,从去年同期的686亿卢比,该公司周四表示。利润从之前三个月上涨了2.7%。马恒达科技公司的营收同比增长24.8%,至5122亿卢比。41个调查的分析师预计收入为5078.3亿卢比,而38个分析师预计净利润为680.4亿卢比,在6月的季度。以美元计算,收入上升18.1%,至8.55亿第二季,从上一季度的3.63%。

“马恒达科技公司报道坚实的营收增长3.7%(美元)的收入,更领先于我们的预期的2.2%” 亚太区首席技术官,马特沙,一份报告中向媒体表示。“良好的交易者获胜连续第五个季度的关键是积极的,预示着股价的进一步实现。”未计利息,税项,折旧及摊销前盈利下跌13.4%,至928亿卢比,在今年第二季度,而营业利润率收窄307个基点,至18.13%,一个基点相当于1%。

该公司由于收缩营业利润率为8万到9万美元,在本季度的签证费用,卢比升值2.6%,或50个基点,中达5亿到7亿美元,显著租金成本,在今年第一季度利用率下降了四分之一,到72%,从74%的大项目转型成本。“虽然决定周期和客户创造,花了一些时间来转化为成交,赢得了我们的预期,大幅提高,一旦等待结束了,马恒达科技公司的执行副总裁,维内特纳亚尔说。我们已经看到了前所未有的收益增长,这是一个时间,这将变成我们的服务需求,只是迟早的事,同样也适用于欧洲。

  该公司将专注于数字化的举措和物联网,所谓的互联网,并增加其在西亚,墨西哥和巴西,董事总经理兼行政总裁,CP Gurnani说。“虽然该公司已经扩增其意图,是一个新时代的系统集成和服务的数字机遇,新交易的收入仍偏向传统业务线,”首席分析师和研究公司的首席执行官,Sanchit Vir Gogia说 。

马恒达科技公司增加3288名员工,在今年第二季度,公司员工总数为92729。在本季度6月30日止,该公司减少债务86亿卢比,偿还277亿卢比,其现金为3669亿卢比,在6月30日。周四,马恒达科技公司的股票下跌0.33%,至2150卢比,对BSE,而基准Sensex指数损失0.74%,至25894.97点。该公司经过市场时间报告其收益。从今年开始,马恒达科技公司的股价已经上涨了17%,而Sensex指数拥有先进的23.3%,而BSE的IT指数上涨7.24%。

Source: Cailiao

Handset-makers dial overseas for growth #Press #Media #HinduBusinessLine

After successfully making a dent in the market share of multinational phone-makers, the domestic players are eyeing double-digit growth from exports.

Karbonn Mobiles, which ranks as the third largest phone-maker in India, according to market research firm IDC, is looking to get 16 per cent of its revenues from overseas markets.

The Titanium series maker currently gets around 8 per cent of its revenue from exports, according to company officials. It made its foray abroad a year ago.

Sudhir Hasija, founder Chairman of Karbonn, wants to expand the company’s presence in Europe. “It would be great to make a mark in Finland, where Nokia was born,” he said. Other mobile device makers have followed Karbonn.

Swipe Telecom, a start-up that raised ₹30 crore from Kalaari Capital, expects to get 15 per cent of its revenue from exports of its products such as Konnect, a 5-inch phablet. “We do export our devices outside India, especially to SAARC countries,” said Shripal Gandhi, Swipe founder and CEO.

Similarly, Murali Retineni, Executive Director, Celkon Mobiles, said in 2013, the company got ₹40-50 crore from exports, which is 5 per cent of its revenue. “We aim to double it to ₹100 crore this fiscal, which will be approximately 10 per cent of our revenue,” he added.

In January, the country’s leading device maker, Micromax, launched operations in Russia and partnered with distributor VVP Group, with an eye on the world’s eighth largest economy.

Micromax introduced its Canvas series of smartphones and Bolt series of feature phones, with plans to be in the top four in that market.

‘Affordable’ segment

The push by Indian device makers comes at a time when Google has announced the ‘Android One’ initiative, which is about launching low-priced smartphones in emerging markets.

Also, Microsoft has discontinued the Nokia X series phones, which run on Android, targeted at emerging markets, thereby opening up opportunities, said industry watchers. “With Samsung and LG at the top end, Indian players are seeing a lot of opportunities in the ‘affordable’ phones segment,” said Sanchit Vir Gogia, analyst with Greyhound Research.

According to IDC, smartphone sales in India grew almost three-fold to over 44 million in 2013.

In January-March 2014, 17.59 million smartphones were shipped into India, compared with 6.14 million in the corresponding period of 2013.

Source: The Hindu Business Line