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Abhrajit Gangopadhyay

The company sees growth in global research and development initiatives as well as in the consulting space. It also sees a strong momentum in client adds in the current quarter.

BANGALORE, March 9

SOFTWARE services provider Blue Star Infotech Ltd. (BSIL) expects 85 per cent of its revenue in the current financial year to come from offshore efforts, according to its Managing Director, Mr Parmod Bhalla. Close to 90 per cent of the firm's revenue for its third quarter ended December came from offshore engagements.

Meanwhile, the company would set up a dedicated development centre for York International Corp. in its Bangalore office and close to 90 per cent of the work would be executed through offshore efforts. Blue Star had recently won a three-year new order of Rs 22 crore from its existing client, York International. The new project envisages a peak engagement of 50 engineers.

Blue Star also sees a strong momentum in client adds in the current quarter. "We have acquired many new clients since January beginning", Mr. Bhalla said. According to Mr Bhalla, this spurt in new wins reflects "expeditious clearance of held-back budgets of previous years".

Though Blue Star has a "healthy funnel", Mr Bhalla declined to comment on near-term client additions, citing ongoing "economic uncertainty". The company added five new customers in its December quarter and serviced 35 clients till December end.

However, Blue Star said that cost of acquiring new businesses had been kept under check. "We have a strong focus on annuity accounts and we have been able to keep the selling expenses under check", Mr Bhalla said.

The company sees growth in global research and development initiatives as well as in the consulting space. "We have seen a steady flow of new business enquiries" in the global research and development segment, Mr Bhalla, said.

However, such projects "were becoming increasingly complex and customers are much more demanding on the skills deployed', he said. Commenting on the business outlook in the consulting domain, Mr Bhalla said efforts in that area would "gather momentum", adding that operating margins in such projects were close to 50 per cent higher than pure technology services.

Product realisation services, which would the growth driver in the next fiscal and consulting services, account for close to 60 per cent of Blue Star's top line and such a services mix had helped the company tide over intense pricing pressure that currently bogged down legacy applications and maintenance services, Mr Bhalla said.

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