The country?s second largest information technology (IT) company Infosys Technologies is banking on engineering and resource and development (R&D) services to drive its revenues in the manufacturing vertical which contributes 20.1% to the company?s revenues.
The manufacturing vertical comprises engineering and R&D services whose share is 19% in manufacturing, consulting and system integration which contributes 32% to the vertical along with business IT operations. The vertical grew 3.5% sequentially and 19% year on year and has a headcount of 15,000.
?We expect engineering services to grow ahead of the company?s growth numbers. The deals in engineering and R&D range around $5 million and are across the board while consulting deals which range from $20-60 million are not too many. Business IT operations usually involve application development and are lesser in number,? said BG Srinivas, head of Europe and global head, manufacturing at Infosys.
The company won nine clients in manufacturing in the second quarter ended 30 September, 2011 of which three were in industrial equipment manufacturing, two in hi-tech and one in the automotive sector. The deal sizes varied from $1-40 million for a period of 2-3 years, said Srinivas.
However, macro economic uncertainty in the US and Europe and cost pressures faced by the manufacturing industry have made the company cautious and hence, it is eyeing expansions in Japan, China and Australia — geographies besides the US and Europe. In India, Infosys services its global clients only.
He explained that emerging markets are seeing demand for automotives while demand is contracting in European countries like Germany.
?IT budgets could be flattish and we are prepared for that. Anyway, manufacturing companies spend only 1-1.5% of their revenues on IT,? added Srinivas.