Date:08/01/2005 URL: http://www.thehindubusinessline.com/2005/01/08/stories/2005010801530500.htm

Back Cognizant expanding Chennai presence

Raja Simhan T.E.

The new Cognizant faciilty at Navalur near Chennai. -- Shaju John

Chennai , Jan. 7

COGNIZANT Technology Solutions is rapidly expanding its presence in Chennai.

After occupying its fully-owned techno-complex in Thoraipakkam spread over 4 lakh sq. ft. a few months ago, Cognizant has now taken an additional leased facility of over 2.70 lakh sq. ft. at Navalur on the Old Mahabalipuram Road, which is the information technology corridor, to accommodate over 3,000 employees.

The company also plans to have another centre in about 1.50 lakh sq. ft. of built up area adjacent to its techno-complex — it accommodates over 3,000 employees — at Thoraipakkam, which is also located on the Old Mahabalipuram Road and built at a cost of around Rs 125 crore.

The infrastructure expansion is part of the company's construction programme (announced in October 2004) for which $76 million (scaled up from $36 million announced in December 2003) has been committed, according to Mr R. Rajagopalan, Vice-President, Finance and Administration, Cognizant.

Including the Navalur centre, Cognizant now has seven development centres in the city and 18 in India. Out of the 15,000 professionals that Cognizant employs globally, about 7,000 are in Chennai, he said.

The building, which has two phases, currently has over 2,500 employees, and an additional 500 would be accommodated in the next few days, Mr Rajagopalan said in an e-mail reply to Business Line.

Cognizant has been growing at a rapid pace and has reported revenue growth of around 60 per cent in the last six quarters — for the third quarter ended September 2004, the company reported revenue of $155.4 million. To fuel this type of a growth, Cognizant is expanding rapidly into additional leased premises before its next phase of fully owned facilities come up. Cognizant's philosophy with respect to real estate ownership is to operate out of its own premises at approximately 80 per cent of its requirement and use leased space for the remaining . This gives the company a strategic cushion for quick ramp-up and also plays well into strategic financial modelling with respect to capital expenditure, Mr Rajagopalan said.

In October 2004, Cognizant announced expansion of its India construction programme to include 8.30 lakh sq. ft. of development space to house 9,000 professionals as well as a new one lakh sq. ft. training centre to serve 1,800 trainees. The development facilities will be built in Chennai, Pune, Bangalore and Kolkata to supplement its existing facilities in those locations and the training centre will come up in Chennai.