Genpact expects China business to grow 30%
Soon after entering into another multi-year contract with Hello Communication of China, Genpact has announced that BPO firm was upbeat on its China-to-China dealing and anticipated that it would expand by approximately 30% over a period of time. As on December 31, 2009, the China-to-China dealings of Genpact, the leading business process outsourcing firm in India, generate $296.9 million, but comprises only 2% of the firm’s entire proceeds.
It may be noted here that the BPO firm entered into a multiple year deal with Hello Communication, a wholly owned auxiliary of Hikari Tsushin Inc., early this month to offer the Chinese firm end-to-end solutions ranging from finance and accountancy and customer service to infrastructure maintenance and information technology. In addition, Genpact will also provide Hikari Tsushin Inc. back office processing services from the firm’s deliverance hubs based in China.
Quoting the president and CEO of Genpact, Pramod Bhasin, a website reports that the contract is for duration of three to five years and will engage around 100 to 200 people to begin with. Describing the contract as a ‘strategic deal’, Bhasin said that the new agreement will enable the company to have a greater footprint in the Chinese as well as the Japanese markets.
According to the principal analyst and founder-director of the advisory firm Ascentius, Alok Shende, if we presume that the expenditure on each seat to be $12 and that Genpact engages 200 people, the proceeds for a period of three years will be approximately $20 million. On the other hand, if the same is calculated for a period of five years, the company will earn revenues worth $40 million.
Meanwhile, Genpact, which has 3500 staff at its three offices in China, is looking forward to increase the employee strength by another 500 by the turn of the current year. In addition, the firm is also exploring the possibilities of new acquisitions. Confirming this report, Bhasin said that though they were keen on acquisition, nothing has been finalized in this regard yet. According to him, the company is looking at acquisitions that are of the magnitude of Symphony Marketing Solutions (SMS), which Genpact took over some time ago. On the other hand, several global firms like General Electric, Oak Hill Capital Partners, General Atlantic and Wells Fargo & Company deposited their investments in Genpact. According to Bhasin, this would enhance the bankroll of the BPO firm and enable participation by other financiers.