Jeffrey M Brennan, vice president of Commercial Software for Altair Engineering and Nelson Dias, managing director of Altair Engineering India discuss the scenario in the Indian CAE market in with Shipra Arora

Describe Altair's operations globally and specifically in the Indian market?
Jeffrey M Brennan: Based in the US, Altair Engineering is a product design consulting company developing design engineering technology. The company delivers product strategy, design development, process automation and commercial computer aided engineering (CAE) software solutions. Our key offering in the CAE software product space includes the Altair HyperWorks software suite. Under the HyperWorks umbrella we have product offerings like HyperMesh, OptiStruct, HyperOpt, HyperView, HyperGraph, HyperForm and MotionView. While the automobile industry is the dominant focus area for the company, off late we have been broad-basing our focus to other industry segments like aerospace, consumer products and heavy engineering industries. We are structuring our products to cater to these other industry segments as well.

Nelson Dias: Altair’s Indian development centre in Bangalore is one of the company’s eight development centres spread globally. The three primary areas of operations are: software development for Altair's core product lines; engineering services like virtual prototyping, designing, simulation for Altair's customers in the US and Japan and product sales in the Indian market.
Currently, the Indian centre is providing inputs to the development activities taking place in more mature centres. One of the areas of focus for India is that of developing interface tools. It comprises maintaining interfaces to all major CAD/CAM and CAE tools, including the competitors’ and upgrading the interface to the latest versions of the software.

How big is the Indian CAD/CAM and CAE market and what is the growth potential here?
Nelson Dias: The overall CAD/CAM and CAE market in India is pegged at Rs 150 crore. The potential of the Indian market is growing further with growing awareness levels in the market relating to CAE. CAD/CAM have been there in the Indian market for quite a while, as a result of which growth in these segments is not going to be as high as in the CAE space. CAE, on the other hand, being a fairly new concept in India with a small base throws open a good untapped opportunity for the company.

There is going to be more demand on the CAE front as there is growth in value engineering demand by Indian companies and more offshoring of engineering services to India. All this is going to give an impetus to the CAE space in India. CAE is also emerging as a higher value proposition as compared to CAD/CAM as the billable hours for offshoring is more in the CAE space than CAD/CAM.

What are Altair's plans for its Indian operations?
Jeffrey M Brennan: Considering the potential of the Indian market we see the Indian operations gaining greater significance in Altair's overall operations. We foresee a growth in terms of business volumes coming from the Indian subsidiary. Currently, its contributes to around 3 percent of Altair's overall business. There is also going to be a major scaling up on the software development front. Currently, the Indian subsidiary contributes to around 10 percent of Altair's overall development activity.

However, in the next 12 to 18 months we see this going up to 25 percent of the total development activity. The company plans to increase the strength of its Indian development team from 15 to 50 in the next 18 months. This will give a huge impetus to the development activity here. This is not just because of the cost advantage that India offers, but also because of the talented engineering resource pool available here. Altair will be further scaling up its activities in India with plans to set up a call centre next year. This will cater to the in-house technical inquiries for Altair’s Indian as well as overseas customers. In fact, Altair is planning a $3 million investment into the subsidiary over the next year. This overtakes the $ 1.5 million investment made in the last two years. The investment will primarily go into setting up the communication infrastructure and funding expansion plans.

What are your focus areas in the CAE space?
Jeffrey M Brennan: On the technology front, Altair's focus both globally and in India is going to be optimisation. The technology, which was introduced by Altair in 1994 is used to define the best material distribution in a given design space. Altair is targeting the optimisation space with its Altair OptiStruct product offering, a structural analysis and optimisation software for conceptual design and refinement. It also provides an integrated analysis solver to evaluate and improve designs. We are leveraging on this technology to establish an edge over our competition in the Indian market.

Nelson Dias: In terms of market focus there is particular potential for value engineering in segments like defence, government labs, transport industry, engineering services providers and captive engineering units in India like GE’s unit. However, the biggest growth from the Indian market is going to come from the engineering service providers. These are the markets that the Indian subsidiary is particularly focusing on.