The Hindu Business Line : Outsourcing talk props up Avaya Global

TALK of the company becoming a global outsourcing hub for its US-based $4-billion parent company, Avaya Inc, has infused an element of optimism in the counter of Avaya Global.

The stock of the erstwhile Tata Telecom company ended the day on Tuesday at Rs 310, up 3.28 per cent, with around 10998 shares traded. As per market rumours the company is also scouting for acquisitions. "Avaya Global makes for a good play on India's buoyant BPO market'', an analyst with a reputed broking said.

The counter, which was ruling around Rs 378 levels (pre-results), witnessed some amount of profit booking in the recent past. This was largely on account of the change in accounting pattern, which resulted in the company showing de-growth in certain segments.

Analysts, however, maintain that there has been no change in fundamentals and with Avaya consolidating its stake in the company, it is poised to cash in on the booming call centre market.

Avaya GlobalConnect is said to be India's leading enterprise converged communications solutions service provider. Its competitors are the likes of Cisco, Nortel, Siemens etc. After the exit of Tata's, Avaya Inc holds 59 per cent of the equity.

A market leader in the niche contact centre solutions market (56 per cent share), it also operates in converged solutions and services. However, it is the contact centre solutions segment that is expected to contribute about 50 per cent to the total revenues in FY05.

Dismissing concerns over the uncertain political climate in the US impacting the company's fortunes, analysts maintain that at best any impact would be short-term. Despite the slowdown in BPO outsourcing in the past few months, there is a perception that it is not a long-term phenomenon.

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