Syntel to invest $40 m in Pune facility; acquires 40 acres land

Pune | Updated: Oct 29 2004, 05:30am hrs
Syntel has acquired 40 acres of land at the MIDC software park at Talawade in Pune and will be investing $40 million in setting up a 9,000-seater campus. In the first phase, the company will be investing $20 million and creating capacity to house 3,000 people.

Pune will be the flagship global development centre for Syntel, Bharat Desai, mentor and chairman of Syntel said. We found that Pune is a location where people from different parts of the country were willing to come to. In addition, the education infrastructure, talent pool and proximity to Mumbai made it an attractive destination, Mr Desai said.

He is looking at developing Pune as a centre for excellence in the automotive verticals. Apart from this, two other verticals that will be on the radar are healthcare and retail. Pune has domain expertise in developing engineering applications, supply chain solutions, logistics and has the potential to become an engineering design service centre, he said.

Companies have set up captive centres now but will, over a period of time, find it more attractive to outsource work, says Mr Desai. They find it hard to meet the internal service level agreements as they do not have a customer service culture, he adds. The automotive segment has been trend leaders in this and they will progress into outsourcing services.

Mr Desai is betting on IT and ITES converging in the near future and clients looking for vendors who can offer both these application development, maintenance and actual running of these applications to one partner.

Combining application knowledge with domain expertise is the strategic direction in which the industry is headed but it will be more complex to manage and risky and pricing would be done differently and payments will be per transaction basis, forecasts Mr Desai.

The mentor of Syntel is putting his money where his mouth is and investing in expanding his Indian operations and upgrading infrastructure to be able to deliver this. Over the last few years we have moved a significant part of Syntels activity to India. Today, 80% of the global work is done out of India, says Mr Desai. In the ITES segment, Syntel will focus on high-value processes.

Apart from the Pune centre, Syntel is also be expanding in Chennai. We have acquired 23 acres of land in Chennai and will develop this centre after completing the Pune project, chief operating officer Keshav Murugesh said. Mr Murugesh hopes to move into the campus by early 2005. There are already 1,000 people in Pune.