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Hexaware: expansion on the cards

Hexaware Technologies is a global IT & BPO services provider. As of now its Indian operations don’t contribute much to its revenues, say one to two percent. That said, the company intends to invest large amounts of money towards building infrastructure.

It recently announced revenue growth of 39.9 percent to Rs 8,482.14 million for CY’06 with net profit up to 99.1 percent to Rs 1,242.32 million for CY’06.

“A notable achievement for the year has been the success in replacing the revenue and profitability lost on account of the transfer of ISC in November’05. We are starting CY’07 with an order book exceeding $170 million for the year,” said Atul Nishar, Executive Chairman, Hexaware Technologies.

He added, “We are on track to realise over $100 million per annum in testing revenues within the next three years. Our recent performance, a solid order book, and a strong business environment give me the confidence that we can double our revenues and profits within the next eight to ten quarters.”

Commenting on the Q4’06 performance, Rusi Brij, Vice Chairman and CEO said, “The rupee’s rapid appreciation in Q4 was a negative surprise that reduced operating margins by 1.3 percent during Q4. But for external variables, we would have exceeded our profit guidance. We also continue to make investments in strengthening our future business competitiveness.”

He further added, “We will continue to focus on verticals like BFSI and transport sector as around 45 percent and 17 percent revenues is generated respectively from this sectors.” According to him outsourcing will increase as it has become an integral part of business and now no resources can take it back.

To Hexaware the year was also marked with highest number of client additions of 49 taking the total of clients to 129; currently the company has 41 Fortune 500 / Global 500 clients. Its repeat business for CY’06 stood at 88.4 percent and the new business booked during 2006 was $171.2 million and its global headcount at the end of the quarter increased to 5,829 with plans to add about 2000 people more this year.

It has added another 50,000 sq. ft facility, adjacent to the existing offices at Mahape. This new facility will have a seating capacity of 550 professionals. The company strengthened its operations in Pune, while 25 acres of land was acquired to build a campus; another 30,000 sq. ft in Pune to seat 300 professionals was also added. The Chennai Green campus is also on track and is expected to become operation in Q3’07.

Hexaware plans to have growth rate, higher than industry growth rate that is around 30-34 percent. Its other plans include $250 million global audit for three years, expanding its BPO and APAC operations and opening centres in East Europe and China. Recently it has acquired FocusFrame, a US based testing services firm and in the coming years planning to acquire another service company, probably in Europe.