Capgemini plans to increase manpower in India over next 3 years

IT services and consulting vendor Capgemini is planning to increase its manpower in India over the next three years.

In 2013, Capgemini increased its headcount in India by 15 percent to 47,000 employees, Times of India reported.

“We have a three-year strategic plan to boost our offshore employees to 50 percent of our total headcount,” said Salil Parekh, chief executive of the company’s UK, North America and Asia application services unit.

Capgemini has about 58,000 offshore employees currently, or about 44 percent of its total employee base. The shift to more work offshore will help Capgemini boost its margins.

The company reported revenues of over 10 billion euros for the year ended 2013 with an operating margin of 8.5 percent. The company expects margin to grow to between 8.8 percent and 9 percent this year, on an organic revenue growth of between 2 percent and 4 percent.

“A lot of our workforce is onshore, so our margin will be lower than some other companies. But it’s also a benefit, for example, in the United States which accounts for about 20 percent of our revenue because we do work onshore we aren’t as affected by the visa issues,” Parekh said.

Capgemini is looking at big opportunities in India. Capgemini works with about 45 clients in India. This is despite Indian providers have struggled in the local market and traditionally have looked to America and Britain as their biggest markets.

The Domestic Indian IT services market will be worth $11.2 billion in 2014, according to Gartner. Nasscom expects the Indian domestic market to grow 10 percent and 9-12 percent in FY 2015.

“In 2013, our Asia-Pacific and Latin America combined growth rate was 12 percent, but the Indian market grew faster than that rate and it would likely grow faster than that level in 2014 as well,” Parekh said.

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