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Tata Info to expand systems integration business to US Economic Times - July 17, 2001

Tata Infotech is planning to expand its systems integration (SI) business overseas and is looking at tapping the high growth US market through a joint venture with SI companies there. It has opened negotiations with firms based in the US.

Speaking to ET, Tata Infotech managing director Nirmal Jain said, the company plans to start a 400 people strong operation in the US and is negotiating with companies which have an annual revenue of $50m - $100m.

"The advantage of entering the market through a joint venture with an existing player is that investments in building up infrastructure will be minimal and growth will be quicker," Mr Jain said. The company has a domestic SI operation which employs 300 people, but according to Mr Jain, high-value projects can only happen in the US.

"In India, the quantity of business may be high, but the margins are low," he said. SI contributes 30 per cent of Tata Infotech’s total revenues. 55 per cent comes from export-oriented software services and the balance 15 per cent comes from its hardware and education business.

While the company has been able to build a software services business overseas, it is now planning to climb up the value chain. During the current financial year, Tata Infotech has also launched an initiative to expand its hardware business.

It has started rolling out ATM machines and plans to sell about 300 units this year.

The company is also collaborating with the railways to set up information kiosks at stations in Mumbai. The firm may recruit about 300 people this year, which will take its total up to 4,000.