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L&T Infotech has a billion dollar dream

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CIOL Bureau
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BANGALORE, INDIA: Sudip Banerjee, who recently announced that he is stepping down as the chief executive officer of L&T Infotech, joined the company in 2008.

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An industry veteran of over three decades, he started his career in the IT industry in 1979 at HCL and later, in 1983, he joined Wipro, as one of the founder members of the IT group of the company. During his (almost) three-decade-long stint at Wipro, Sudip held various position like general manager - software products, group vice president - human resources and many more.

Speaking to Akanksha Prasad of CIOL, Sudip Banerjee talked about his stint at Wipro, L&T Infotech and his key observations from the current market stand. Read on:

As you leave L&T Infotech, how do find it positioned in the market as against the peers?

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Sudip: L&T Infotech is no longer counted as a mid-size company and is poised for a bigger role. Only a handful of companies are more than $500 million and very soon we would join the billion dollar league. Though there have been talks about it, at that point the recession of 2008-09 was not foreseen. No one is sure about future but the company in the right path, and is looking at the 30 per cent growth from last year and it is expected to reach somewhere near Rs. 3000 crore in the current fiscal.

Our rough estimate is that it should take us another 2-3 years to reach to billion dollar mark. It is backed by strong and reputed groups. It has all the basic ingredients and a very strong team.

There are three layers in the industry today — big billion dollar companies, followed by mid-size companies and then multiple smaller firms. L&T Infotech is one unique company that is part of a large group, which has scaled to such a level in such a small time, with all the strengths.

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Only a handful of companies have moved up to join the billion dollar club. Why a few companies that were established before L&T Infotech could not scale up?

S: To grow to a billion dollar company is the matter of inherent strength, company policy, the expansions they do. The companies that made it followed the right step in the right time — they expanded horizontally, expanded service lines, went into near market, took risks, created execution centers, got listed in the stock exchange to generate customer confidence...

Other companies that could not make it, did not expand their portfolio and remained software company throughout. They did not build new units like BPO, infrastructure management, testing, consulting, product engineering. They concentrated in a few markets, had only one execution centers, or did not invest in sales and marketing aggressively. And they remained in the $100-300 million slab.

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Everyone is talking about the recovery in the market and that deals are coming back, but why are not many large-size deals happening?

S: CIOs want visible result for their business units. Earlier days, companies gave single chunk of business like a ten-year 500 million or billion-dollar contract. But today partners understand that it is important to build relationship with the big customers. I believe such buying will continue for another 2-3 years, but in the longer period, partners can get larger contracts based on this relationship.

Earlier, it used to be single RFP for large amount, but now companies first select the partner and then put them in various small contracts, which reap similar profits/revenues when looked from long-term perspective.

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Where do you see the Indian IT firms standing against global rivals like IBM, HP?

S: Indian companies are resilient, focused on quality and working on newer other services. These factors position them at a better position than global competition. What we are doing is not just software and offshore, but also other services including development, implementation roll outs like software development, SAP implementation, turnkey solutions, RIM and testing services.

You worked at Wipro for a long time. What are your key takeaways from that stint?

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S: Since we were new players in the IT sector, we had a lot of learning. We started working on building more experience and learning. As we grow, our portfolios mature. We came up with newer concepts and innovative solutions like ODC (offshore development center), RIM (remote infrastructure management) and testing. We first went into the US, then the UK and other markets like continental and Japan.

Looking back at 2008, when you joined L&T, it was also the time when recession hit the market. How did you meet the challenge?

S: The thumb rule was to keep your head above water and make sure you do not get drowned. The first 9-12 months was to realize our strengths, work on them and build further. It was one of the best where I brought my experiences and learning from the past to build and expand the portfolio here.

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