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Friday, Mar 05, 2004

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`IT finishing schools have enormous potential'

V. Rishi Kumar

Hyderabad , March 4

ESTIMATED at about Rs 1,500 crore, the IT education and training segment is projected to grow by about 20-25 per cent this year. Trends point towards a significant change in the business mix with corporate training business set to grow and the retail segment seeing a marginal dip.

Within this, the area of serving as a finishing school to fine-tune student skills and make them job-worthy has emerged as major areas.

Mr Pramod Khera, CEO and Managing Director of Aptech Ltd, told Business Line that the IT education sector performance has to be analysed in a different way since this was in the backdrop of about 2-3 years of slowdown coinciding with general slowdown.

The growth last year was fuelled largely by corporate and institutional education, which has increased from about 10 per cent to 15 per cent.

"The growth in IT education has been largely fuelled by large number of graduates coming out of engineering and other technology education colleges in the country."

He added: "A good number of them are in the South, where there is a large base of engineering colleges.

"This training assumes importance as there continues to be mismatch in what is taught in these colleges and what the industry expects them to know."

Therefore, the IT education post-college is aimed at both filling the gap in such areas and arming the candidates with communication and soft skills and in new areas such as embedded systems, multimedia training and animation, networking and enterprise applications.

"The other area for growth in the IT education is the training to meet business process outsourcing (BPO) industry requirements. To address this growing market, where the demand is expected to be about 100,000 people this year, we have taken up the task of providing HR solutions to corporates."

Apart from call centres, he said, there was a big opportunity in the non-call centre BPO applications, where professionals need to hone up their skills in the areas such as accounting, finance and legal services.

Overseas plans

Consolidating three distinct brands - Aptech, Arena and SSI Education - Aptech Ltd as a company is looking at expanding in the overseas markets.

Currently estimated at about 20 per cent of the overall company business, Aptech expects to grow this further by investing about $2 million in the joint ventures in Canada, US, China and South America this year.

"Having raised about $14 million from a GDR issue, we plan to invest about $5 million over the next two years in expansion that includes a content development centre in Chennai, the University project in Chattisgarh and overseas presence. We are also looking at possible acquisitions in the overseas markets."

He added: "However, we cannot say with certainty by what timeframe we would be able to acquire companies in niche education space."

By adopting the franchise route, the company has established about 250 overseas centres of about 3,200 plus centres of all the three brands.

"During the course of the year, we expect to add about 30-40 overseas centres through the franchisee route and these investments are aimed at increasing overseas presence."

Content development has emerged as an important business and this is one area that is set for rapid growth.

"This content development could be a combination of computer-based training or instructor-lad and we are already working for Lufthansa and IATA."

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