• Investment World
• eWorld
• Catalyst
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest

Abhrajit Gangopadhyay
Vishwanath Kulkarni

BANGALORE, Oct. 8

BLUE Star Infotech Ltd plans to hire Chinese code-writers for vanilla software development even as it plans to design and test new projects in the Japanese market.

Faced with brutal rate wars from the Chinese vendors in the Japanese market, Blue Star is also likely to cut its rate to win new customers, the Managing Director, Mr Parmod K. Bhalla, said.

"Chinese companies are offering prices at $12-13, which is almost half of our rates,'' Mr Bhalla said adding that Chinese strategy for simple development was "the same game Indian vendors played earlier".

Reiterating the company's earnings guidance for the current financial year at 30 per cent jump in top line, Mr Bhalla said that HP is likely to stay as the top customer even in the current year. Last year, HP contributed close to 33 per cent of Blue Star's sales.

However, business applications might nudge out hi-technology practices as the largest vertical contributing to the top line in the current fiscal, Mr Bhalla said. The company is eyeing outsourcing deals in the business-application segment, which are typically in the range of $3 to $5 million.

"Our growth driver would be business applications segment,'' Mr Bhalla said. The company plans to spin off separate verticals in retail and manufacturing within the business application segment, buoyed by visibility of multiple dedicated offshore development centres. However, he did not detail the time frame for such spin-offs.

The company is also looking at strategic alliances in retail and manufacturing ventures, which could continue to bring in business. Commenting on plans of proposed buy-outs, Mr Bhalla said that the company is targeting US consulting firms in the range of "$30 million plus" and talks with some such potential targets are on.

However, Blue Star is likely to enter into a "strategic relationship" with the potential target before a complete buy-out, Mr Bhalla said.

The company expects its manpower utilisation level to stay capped at close to 85 per cent for the current fiscal.

Send this article to Friends by E-Mail
Comment on this article to BLFeedback@thehindu.co.in

Stories in this Section
Cross-connections at VSNL

Copyright © 2002, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line