India will continue to be competitive: Premji
By agencies   |   Monday, 28 November 2005, 20:30 IST
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NEW DELHI: Wipro Technologies Chairman, Azim Premji, has indicated a “more generous” dividend payout than in the past two years from its existing cash kitty of close to $1 billion. The company announced that it was on the lookout for mid-sized acquisitions in the U.S., Europe and India. “We have $1 billion in cash reserves which will be utilized for the payment of dividend and the acquisitions. The dividend payout ratio will be more generous than in the past two years,” Premji said. The company was looking at mid-sized acquisitions in the U.S and Europe, and also in the domestic market. “It will enhance our consultancy skills. We are not looking for general-purpose acquisitions, but at specialized verticals. We are looking for companies which can give us a good geography such as continental Europe,” he said. In order to leverage on other low-cost locations, Wipro plans to set up an integrated IT and BPO facility in Bucharest (Romania) in the next 8-12 weeks. Announcing this Premji said, “The center would serve the markets of Germany and France. We are also looking at one more center in Far East which will be more cost-efficient than China.” At present the company has centers in Shanghai and Beijing, he added. “India churns out 3,50,000 engineers per annum while the U.S. graduates 70,000 engineers. Germany graduates more architects than engineers. Engineering is not getting the desired attention in Western nations, and in three years, it will lead to a shortage of technical talent. It costs $7,500 for an engineer in India while the same is $55,000 in the U.S.,” he argued. Putting light on company’s BPO work, Premji said, “In addition to voice, we are driving the transaction processing business. It is 14-15 percent of the total sales but in two years we hope to increase it to 40 percent as it has a larger market share possibility.”

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