KPIT Cummins freezes hiring; cuts variable pay by 50%
Ranjit Shinde ET INTELLIGENCE GROUP PUNE-BASED mid-size IT firm KPIT Cummins Infosystem has frozen fresh recruitment for three-four quarters in the wake of turbulence in its core automotive and manufacturing verticals. The Rs 793-crore company has also reduced employees’ variable pay component by over 50%. This is a part of the company’s strategy to control internal costs and protect margins at a time when new business is hard to come. The variable pay forms around 10% of the salaries of KPIT employees. “We are keeping a tight lid on our headcount. We will not be increasing the number of employees for at least three-four quarters,” said chairman Ravi Pandit. He also confirmed that as many as 290 employees in KPIT’s development team were allowed to go in the three months ended March 2009. KPIT earns more than four out of five rupees of its revenues from the manufacturing vertical. The global economic slump has impacted the manufacturing industry, thereby spelling trouble for the company’s future growth. KPIT Cummins is witnessing a delay in new projects from clients. “We have not provided future performance guidance, given the tough times for manufacturing clients. There is no certainty about growth in revenue for the current year. However, we are trying to retain our margins by increasing productivity and cutting costs,” said Mr Pandit. To improve productivity, KPIT has increased the share of revenue from offshore activities and fixedprice contracts. The offshore revenue relative to total revenue increased to 56.6% in the March quarter from 53% a year ago. --~--~---------~--~----~------------~-------~--~----~ You received this message because you are subscribed to the Google Groups ""GLOBAL SPECULATORS"" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [email protected] For more options, visit this group at http://groups.google.com/group/globalspeculators?hl=en -~----------~----~----~----~------~----~------~--~---
