News: Infosys eyes buys in Germany & France
(RTR 02/09/2006) Bangalore - India's second-largest software services exporter, Infosys Technologies Ltd, is looking at acquisitions in Germany and France to expand operations in Europe, its Chief Operating Officer said on Friday.
Nasdaq-listed Infosys is also eyeing other European countries, besides expanding in China, S Gopalakrishnan said in an interview.
It also plans to step up its presence in Latin America, Japan, South Africa and the Middle East, he said.
"What we are looking for is more strategic acquisitions which allows us to expand faster in a market or in a particular industry," Gopalakrishnan said.
"So, we are looking at locations like Germany and France where the challenge is to recruit local people," he said.
However Infosys, whose clients include ABN AMRO, Goldman Sachs and Airbus, was not close to clinching an acquisition, he said.
Chief Financial Officer V Balakrishnan said in June Infosys was looking to acquire companies with an annual revenue of $100 million to $200 million.
Indian software services companies, which have been riding an outsourcing boom, have seen businesses from Europe growing faster than their main US market.
Clients in North America accounted for 64 per cent of Infosys' revenue in the June quarter, nearly flat from a year ago, while customers in Europe made up 26.2 per cent, up from 23.9 per cent.
RISING WAGES A CONCERN
Rising salaries are a concern for India's $23 billion software services exports industry, even though wages in Asia's fourth-biggest economy are about one-fifth of Western salaries.
"It is a concern in the medium to long term. We are managing it currently but over the longer term we need to figure out how this is going to play out," Gopalakrishnan said.
Infosys has been able to charge 2-3 per cent more from new clients and is looking to grab more outsourcing deals to soften the blow from higher staff expenses, he said. It has also raised charges for existing clients.
Industry leader Tata Consultancy Services Ltd, Infosys and third-ranked Wipro Ltd beat market expectations with their quarterly earnings in the June quarter thanks to robust outsourcing business.
Infosys plans to raise its staff in China, where it has a software development centre in Shanghai and plans to start operations in the eastern city of Hangzhou soon, to 2,000 by end-2007 from 800 now, Gopalakrishnan said.
"It is a development centre as well as a market for us. From a development centre perspective, we are already servicing about 15 clients from China. It is starting to pick up," he said.
Indian companies are expanding in China because of its strong potential, and as a hedge against rising costs in India.
Shares in Infosys have gained 21 per cent since the start of 2006, outpacing a 14.5 per cent rise in the BSE information technology index but below a 25.3 per cent increase in the benchmark BSE index.
Nasdaq-listed Infosys is also eyeing other European countries, besides expanding in China, S Gopalakrishnan said in an interview.
It also plans to step up its presence in Latin America, Japan, South Africa and the Middle East, he said.
"What we are looking for is more strategic acquisitions which allows us to expand faster in a market or in a particular industry," Gopalakrishnan said.
"So, we are looking at locations like Germany and France where the challenge is to recruit local people," he said.
However Infosys, whose clients include ABN AMRO, Goldman Sachs and Airbus, was not close to clinching an acquisition, he said.
Chief Financial Officer V Balakrishnan said in June Infosys was looking to acquire companies with an annual revenue of $100 million to $200 million.
Indian software services companies, which have been riding an outsourcing boom, have seen businesses from Europe growing faster than their main US market.
Clients in North America accounted for 64 per cent of Infosys' revenue in the June quarter, nearly flat from a year ago, while customers in Europe made up 26.2 per cent, up from 23.9 per cent.
RISING WAGES A CONCERN
Rising salaries are a concern for India's $23 billion software services exports industry, even though wages in Asia's fourth-biggest economy are about one-fifth of Western salaries.
"It is a concern in the medium to long term. We are managing it currently but over the longer term we need to figure out how this is going to play out," Gopalakrishnan said.
Infosys has been able to charge 2-3 per cent more from new clients and is looking to grab more outsourcing deals to soften the blow from higher staff expenses, he said. It has also raised charges for existing clients.
Industry leader Tata Consultancy Services Ltd, Infosys and third-ranked Wipro Ltd beat market expectations with their quarterly earnings in the June quarter thanks to robust outsourcing business.
Infosys plans to raise its staff in China, where it has a software development centre in Shanghai and plans to start operations in the eastern city of Hangzhou soon, to 2,000 by end-2007 from 800 now, Gopalakrishnan said.
"It is a development centre as well as a market for us. From a development centre perspective, we are already servicing about 15 clients from China. It is starting to pick up," he said.
Indian companies are expanding in China because of its strong potential, and as a hedge against rising costs in India.
Shares in Infosys have gained 21 per cent since the start of 2006, outpacing a 14.5 per cent rise in the BSE information technology index but below a 25.3 per cent increase in the benchmark BSE index.
posted by InCar Group Press Room at 15:52
0 Comments:
Post a Comment
<< Home