Rank 11: HCL Infosystems: The King is Back

The predator is back. In the beginning of FY 2001-02, HCL Infosystems
set itself a tough target–of regaining the number one position in the desktops
space from Compaq. By the end of the year, HCL Insys had raced ahead to the top.
No radical strategy here, but given the slowdown, HCL’s huge reach of
1,000-plus resellers and aggressive targeting of B&C class cities did the
trick. It maintained a dominant lead in the small business segment and notched
up gains in the government, banking and insurance segments.

Performance Highlights Regained No 1 PC slot from Compaq, selling 150,366 units Tieup with Sun Microsystems to counter the Wipro-IBM alliance Strengths Plans to make India the remote hub for global service aspirations will help the bottomline Strong reseller network will help it increase penetration in smaller towns Weaknesses HP-Compaq merger will see cut-throat competition in the PC space The ‘HW-only’ image, with the company not known as a technology player l Startup: 1976 l Products & services: PCs, servers, facilities management, systems integration, software development, Internet access and networking solutions l Branches:158 l Dealer Outlets: 1,017 l Address: E-4/5/6, Sector 11, Noida 201301, UP l Tel: 4520977 l Fax: 4525383 l Website: www.hclinfosystems.com

In recent times, HCL has been positioning itself as a technology company, and
the first to introduce new product lines–it was the first to launch and ship
Pentium 4-powered PCs under the Rs 40,000 price barrier, simultaneous with the
global launch. It won similar accolades with the country’s first 64-bit
Itanium server. The year saw a high-profile tieup with Sun Microsystems, even as
its partnership with HP failed to show strong returns for either of the two.
With Sun in its portfolio, HCL now hopes to add more dash to its server
marketing. The last fiscal saw shades of this, with agency revenues growing by
13% to Rs 352 crore.

On the services front, HCL Insys continued the drive to shed its ‘hardware
only’ image and saw success on the domestic services front. Revenues in this
segment grew by a robust 44%, though export revenues didn’t bring in targeted
growth. The previous year had seen exports–primarily professional services–jumping
from 4.7% to 12%, but FY 2001-02 saw this drop by a percentage point.

Looking ahead, HCL Insys is banking on direct customer service centers at 151
locations, 1,000-plus engineers, three software exports factories and a
state-of-the-art manufacturing facility to corner the enterprise solutions and
PC space. In the desktop segment, however, the company will have to perform a
miracle to retain the number one slot, given the HP-Compaq merger. In the server
segment, it is pitching new order hopes on its truck with Sun Micro, a direct
answer to the Wipro-IBM alliance. The duo has already bagged some fat orders,
among them those from Punjab National Bank and Madura Garments.

The focus on services will also continue, and HCL aims to leverage on its
knowledge base to crack new accounts.