Posted by: Bruce Einhorn on March 25, 2011
(This post originally referred incorrectly to HCL Technology. The correct name is HCL Technologies.)
Indian outsourcers are getting ready for more growth. Indian newspaper The Economic Times reports today that the big five IT services companies—Tata Consultancy Services, Cognizant, Infosys, Wipro, and HCL Technologies—are on a hiring spree, adding tens of thousands of new workers in India. Their net headcount increased by 114,000 in the nine months ending in December, 2010. That compares to just 47,000 in the same period the year before. In part, the strong hiring is because of the low-base effect: In 2009, Indian companies were still coping with the uncertainty of the global financial crisis and were being cautious about adding employees. However, the growth is also a sign that the Indian outsourcers expect more business coming their way soon.
Ironically, the company to watch here isn’t even Indian. Cognizant’s stock price has gone up 58 percent since July 2010 and the stock got another boost on Thursday after Goldman Sachs said Cognizant (CTSH) was one of its top picks in the IT services sector. Cognizant’s home office is in Teaneck, New Jersey and the stock is traded on Nasdaq, but it has a major presence in India and it’s growing in the country. Last month, the company announced it will invest more than $500 million in four Indian cities through the end of 2014. That will give it space for 55,000 workers. With a workforce at the end of 2010 of 104,000 workers, Cognizant is going to be giving India’s big outsourcing companies even more of a scare in the months and years ahead.