Japanese IT firm NTT Data Corp still scouring for opportunities to ramp up its presence in India

Japanese information technology firm, NTT Data Corp, said it is mulling more acquisitions as it seeks to expand its foothold in India. Just recently, the Japanese firm acquired another Indian firm for an estimated $200 million. According to NTT Data, it will be on the lookout for additional acquisitions to reinforce its Indian offering and placing.

NTT Data Corp acquired Intelligroup Inc, a Hyderabad based firm, as it seeks to foment its place as one of the foremost information technology firms in India and globally. NTT Data Corp.’s president for global IT services, Takashi Enomoto, said the firm’s main target is to become one of the top five IT services firms and India comes as a one of the crucial parts for achieving its plans, said Enomoto.

Further to that, Enomoto reiterated that global delivery capabilities from India are a very important part of the firm’s strategy. NTT Data is tallied amongst the top 10 IT services companies globally. However, according to analysts, NTT Data might be on the lookout for midsize IT companies in India as it moves to cut down its overall employee costs to enable it turn profitable. Just recently, NTT Data raised Rs 5,592, about $1.2 billion for its investment undertakings.

This year, the Japanese firm had sum revenue pegged at about $12 billion, about Rs 55,920, but its net profit margin was about 3%. With the acquisition of Intelligroup Inc. in June, NTT Data attained around 2,600 employees in its India operations. The firm is seeking aggressive growth and may be keen on expansion opportunities outside of the Intelligroup acquisition, Enomoto said. Analysts believe NTT Data’s move is in line with what other giant IT service firms are doing globally, for instance International Business Machines Corp and Accenture Plc that have used India as a low cost hub to increase profitability.

IBM begun its Indian operations in 1992 and its sum employment numbers stood at 73,000 as at December 2007. Since 2007 however, IBM stopped sharing its India specific headcount. But even so, analysts have estimated that IBM’s India operation has an existing headcount of about 100,000.

Currently, NTT Data’s offshore presence is predominantly in China, from where it serves Japanese clients. The firm has a global headcount of more than 34,000, of which around 5,000 is offshore. Japan is the second largest IT services market after the US, estimated to be worth $117 billion.

15 Sep 2010.