Analyst Meet August 27, 2002 Living up to the promise © 2002 Infosys Technologies Limited Challenges in the Asian market V. Sriram.

© 2002 Infosys Technologies Limited

Analyst MeetAugust 27, 2002

“Living up to the promise”

Challenges in the Asian market

V. Sriram



Agenda

■ IT Services Market in Asia Pacific■ Infosys in Asia Pacific today – A Snapshot■ Key Characteristics of the region■ Infosys in Japan, Australia, Singapore and

HongKong



A Snapshot of IT Services Market - Asia Pacific Vs. Worldwide

IT Services Revenue Share M USD 2001United States 250,791Asia Pacific incl. Japan 93,194Europe 151,729Rest of the world 46,570Total Worldwide 542,284

IT Services Revenue Share in M USD 2005United States 311,304Asia Pacific incl Japan 129,440Europe 193,744Rest of the world 61,714Total Worldwide 696,201

Source: Gartner Dataquest July 2002

Worldw ide IT Services Revenue Share (%) - 2001

Europe

27.98%

United

States46.25%

Asia

Pacif ic 17.19%

Rest of the

w orld8.59%

Worldw ide IT Services Revenue Forecast - 2005

United

States

44.71%Europe

27.83%

Asia

Pacific

18.59%

Rest of

the world

8.86%



Asia Pacific IT Services Market size forecast by Country (in Billion US $)

64

.8

11

.8

5.4

3.8

1.8

5.3

65

.2

12

.9

6.2

4.2

1.9

6.0

70

.2

14

.2

7.2

4.7

2.2

7.0

76

.3

15

.8

8.4

5.2

2.4

8.2

83

.0

17

.9

10

.1

5.9

2.7

9.8

2001

2002

2003

2004

2005

Japan ANZ China & HK South Korea Singapore Rest of APAC

Total93.1 b0

Total96.4 b

Total105.3 b

Total116.4 b

Total129.4 b




Japan : TokyoAustralia : Melbourne

SydneyHong KongSingapore

Infosys in Asia Pacific Today - Snapshot Total Revenues / Head Count / Offices

■ ~7 % of company revenues■ 5 offices (excluding offices in India)■ Approximately 900 employees working for APAC Clients

Coverage■ From Japan - Japan and Korea■ From Hong Kong - Hong Kong, Taiwan and China■ From Singapore - ASEAN countries■ From Australia - Australia and New Zealand

Year of start for offices■ Japan 1997■ Australia 1999■ Hong Kong 1999■ Singapore 2000



Infosys APAC has grown rapidly in the past 2 years through new account acquisition…..

0

5

10

15

20

25

30

35

40

45

1997-98 1998-99 1999-00 2000-01 2001-02

0%

1%

2%

3%

4%

5%

6%

7%

8%

APAC Revenue in M USD Percent of Total Revenue

0

5

10

15

20

25

30

1997-98 1998-99 1999-00 2000-01 2001-02

Total # of Clients

28 clients inFY 2001-02



Infosys APAC Revenue Split for 2001-2002

Percentage Revenue in FY 2001-02

3.5%

12.4%

33.6%

48.6%

2.0%

Japan

Australia

Hong Kong

Singapore

Others



Verticals and service footprint

Verticals■ Manufacturing■ Financial Services■ Telecom

Services■ IT strategy and effectiveness■ Large Scale reengineering including platform

conversion■ Package implementation



APAC – Key Characteristics■ Diverse Markets

■ Challenges include diversity of language, culture, business practices

■ Outsourcing as a concept slowly getting accepted

■ In most countries (except Japan) no credible mid size Consulting/ SI company

■ Need for skills in latest technology areas acute

■ Infosys in APAC■ has traditionally grown at twice the company growth rate■ 90% of clients are Global 1000 companies■ Long term client relationships■ Have built local capability to deliver in markets like Japan



Communications7%

Education2%

Finance19%

Government13%Healthcare

2%

Distribution11%

Services6%

Transportation6%

Utilities6%

P rocess Manufacturing

11%

Discrete Manufacturing

17%

67.8 b 64.8 b 65.2 b

70.2b 76.3 b82.9 b

0

10000

20000

30000

40000

50000

60000

70000

80000

90000

2000 2001 2002 2003 2004 2005

Softw are Maintenance and SupportHardw are Maintenance and SupportBusiness Process and Transaction ManagementManagement ServicesEducation and TrainingDevelopment and IntegrationConsulting

Japan IT Services Market Size and Forecast

World’s Second largest economy, Japan accounted for 12% of the worldwide IT services market in 2001. CAGR will be 4.1% through 2005

Japanese IT services market was forecast at $64.8 billion in 2001, growing to $83 billion in 2005

88 Companies in Fortune 500 (July 2002)

Japan – Salient Features




Infosys in Japan■ Key Initiatives / Achievement

■ Marketing Office setup in Japan in 1997 ■ 48.6% of Infy APAC revenue from Japan(FY 02) ■ 6 Fortune 500 clients started since the inception of the branch in-spite of a sluggish

economy■ Sales, Marketing,HR & Support teams include Japanese nationals■ Japanese - English technical hires, Dedicated translation team

■ Challenges■ Language Proficiency, Culture■ Slow Decision ■ Intense pressure on prices■ Highly cost and quality conscious market■ Hiring of locals and other Japanese - English enabled Technicals■ Short cycle projects with evolving requirements■ Aggressive schedules in almost every project



Australia – Salient Features

Australia will remain the largest IT Services country in Asia Pacific after Japan, It will grow up to 16.7 b US $ by 2005 (Gartner Dataquest July 2002); Australia accounted for 11.8% of the Asia Pacific IT services market in 2001

Restructuring of industries such as utilities and telecommunications is generating demand for consulting leading to integration projects

6 Companies in Fortune 500 (July 2002)

Communications15%

Education2%

Finance18%

Government25%

Healthcare2%

Distribution5%

Services8%

Transportation8%

Utilities5%

Discrete Manufacturing

8%

P rocess Manufacturing

4%

16.7b

14.7b13.1b

11.9b10.9b10.3b

0

20004000

6000

800010000

12000

1400016000

2000 2001 2002 2003 2004 2005

Softw are Maintenance and SupportHardw are Maintenance and SupportBusiness Process and Transaction ManagementManagement ServicesEducation and TrainingDevelopment and IntegrationConsulting

Source: Gartner Dataquest June 2002



Infosys in Australia

Key Initiatives / Achievement■ Marketing Office setup in 1999■ Infy getting established in Australia ■ 13% of Infy APAC revenue from Australia (FY 02) ■ Continuous hiring of Australian nationals for Sales and Delivery■ High end positioning■ Lot of “consulting”/ “trouble shooting work” ■ Infosys as a “Thought Leader” in Australia ■ Accounts like Telstra/ Vodafone/ Suncorp Metway/Swiss Re

Challenges■ Establish credibility of Global Delivery Model■ Create Infosys Brand Equity



1.35b

1.2b1.27b

1.47b

1.62b

1.8b

0

200

400

600

800

1000

1200

1400

1600

1800

2000

2000 2001 2002 2003 2004 2005

S/W maintenance & Support

H/W maintenance & Support

Business Process & TransactionManagementManagement Services

Education & Training

Development & Integration

Consulting

Total

Singapore and Hong Kong IT Services Market size Forecast (in US $)

Hong Kong

1.75b1.8b

1.9b2.2b

2.4b

2.7b

0

200

400

600

800

1000

1200

1400

1600

1800

2000

2200

2400

2600

2800

3000

2000 2001 2002 2003 2004 2005

Softw are Maintenance and Support

Hardw are Maintenance and Support

Business Process and TransactionManagementManagement Services

Education and Training

Development and Integration

Consulting

Total

Singapore

Source: Gartner Dataquest June 2002



Infosys in ASEAN RegionMarket

■ Manufacturing, Financial and Telecommunications markets are strong and their expansion in IT is a main business driver for Software support services

■ Govt’s push into ebusiness and developing SMB segment is driving the IT services market in Singapore and Hong Kong

■ Fragmented market; Cultural linguistic diversity

Key Initiatives / Achievement■ Marketing Office setup in Hong Kong in 1999 and in Singapore in 2000■ Global strategic partnerships for large Asian companies■ Marketing to tap into the influencing positions of Head Quarters

Challenges■ Low brand of Indian Companies■ Cheaper alternative (but unproven) location like China



How do we cope with these challenges ?

■ Increase local content■ Invest in linguistic capability■ Customise solution / delivery process to meet local

requirements■ Alliances specific to markets■ Focus on business development activities

(Services/Verticals)



“Living up to the promise”

Thank You

Analyst Meet August 27, 2002 Living up to the promise © 2002 Infosys Technologies Limited Challenges in the Asian market V. Sriram.

Documents

region infosys

work infosys

asia pacific infosys

japan japan

australia australia

infosys brand equity

services market asia

offices japan