Mumbai: India is the fastest growing market for several information technology multinationals, IBM being one of them. The company increased its revenues by 37% in 2006, spurred on by the growth of small and medium businesses in the country. More than 50% of the company’s revenues come from customers in small and medium segment. To grow its business further, IBM India had announced expansion plans earlier this year to set up a direct presence in 14 tier-II cities in the country Ramesh Narasimhan, director, global mid-market business, India and South Asia, spoke to Mint about the company’s growth plans. Edited excerpts.
How do you plan to grow your small and medium business operations in India?
The market for IT products and solutions is growing at 18-22% every year, and a bulk of this is coming from small and medium businesses. We want to grow at twice the market rate.
Big plans: Ramesh Narasimhan.
If we want to reach this target, we have to expand into more locations and capture more businesses. Most of these small and medium businesses cater to the larger players.
Which sectors are bringing in the maximum business?
Sectors such as automotives, health care, banking and financial services are doing very well. Many of these companies, while small, are growing at 100% year-on-year, so we will grow with them. Besides these, new industries are coming up which we are excited about—aircraft maintenance, for instance. Because various airlines in the country have bought so many planes, aircraft manufacturers such as Airbus and Boeing are setting up maintenance centres here. These will require IT solutions on a large scale.
How many cities have you expanded into this year?
We have rolled out operations across 10 of the 14 cities on the agenda. We will complete the remaining—Surat, Bhubaneswar, Nashik and Dehradun by the end of the month. We commissioned a market study last year to study the potential of several tier II cities across the country, and these looked the most attractive. Many of these cities have a specialized industry focus, which will help us broaden our sector portfolio. For example, we are catering to more customers in the gems and jewellery space after we launched operations in Jaipur and in the garment exports space because of Coimbatore.
Next year, we want to set up operations in seven more tier II cities, for which we have commissioned a market report. The long-term idea is to get IBM to all corners of India.