Aztec Software cuts 10% staff

MUMBAI: Aztec Software and Technology Services Ltd. has cut its workforce by
10 per cent due to uncertainty of business, a company spokeswoman told Reuters
on Wednesday.

She said around 35-40 of the firm's 350 employees had been asked to go over
last weekend. Aztec's shares were up 1.22 per cent at Rs 33.10 in morning deals
at the Bombay Stock Exchange while the benchmark index was up 0.23 per cent.

Aztec later said in a notice to the Bombay Stock Exchange that the downsizing
was to align staff capacity to immediate demand.

"...(this was) keeping in view the downturn of the market made worse due
to the recent events in the United States and also to ensure a balance in the
skill mix to be in line with the company's strategy to address the enterprise
customers," the statement said.

"The company...is confident that several of its initiatives are
proceeding in the right direction and therefore the medium term outlook
continues to remain strong," it said.

The Economic Times on Wednesday quoted Aztec's chairman S Parthasarthy as
saying it was taking longer to acquire customers in the United States and that
decisions to outsource projects had almost frozen.

He said Aztec was adopting the alliance strategy - partnering with
consultants to offer the cost advantage of the Indian offshore services model,
as breaking into new accounts by itself was getting difficult.

Aztec is one of few Indian software firms that has laid off employees
recently. Unlisted Mahindra-British Telecom said last month it plans to lay off
about 300 employees, or about a tenth of its workforce, but cited
underperformance as the reason.

Animation software company Pentamedia Graphics Ltd. also said last month it
asked 107 out of a total 1,500 creative professionals to leave. Privately-held
Sasken Communication Technologies Ltd. recently announced a 20 per cent cut in
salaries, but said it did not plan to sack staff.

Telecoms equipment maker Himachal Futuristic Communications Ltd. said in July
it will lay off 100 of its 130 employees in software services joint venture with
Australian tycoon Kerry Packer's Consolidated Press Holdings. But industry
sources say most of the bigger Indian software companies are still hiring on,
though cautiously.

(C) Reuters Limited 2001.