Largest Korean IT services company sets up shop

LG CNS Global to cater to enterprise space in India
The Financial Express

BANGALORE, DEC 21: Korean IT services company LG CNS has set up a 100% subsidiary in India — LG CNS Global — with an initial investment of $2 million.

This is in addition to LG Software India (LGSI) which is already operating out of Bangalore. Around 30% of LGSI has been merged with LG CNS Global, though LGSI will continue to have separate operations in India, said Paul Jeong, CEO, LG CNS Global.

“LGSI is mainly into embedded space, LG CNS is into enterprise space. Both have differnt offerings,” he said. LG CNS Global will provide product re-engineering, system integration, application development, system management and enterprise services for the US, Europe and Korean markets.

Mr Jeong also said that LG CNS Global would get a cost advantage by operating out of India. “India has a highly skilled talent at a lesser manpower cost. Korean salaries are five times higher than salaries in India,” he said.

“Our mission is to provide the best of software engineering capabilities for our customers and this made India a logical choice for us to set up the strategic centre for our global operations in Bangalore,” said Byung-Chul Jung, president and CEO, LG CNS Co Ltd.

LG CNS has 130 people working in India (acquired from LGSI). “We are looking at having around 800 people and revenues of $30 million by 2009 in India,” he said.

The company is also looking at having BPO operations in India shortly. “We have started BPO operations in a small way in Bangalore. Around 10 people are working on an e-catalog project in India. We are looking at expanding this team in the future,” said Mr Jeong. Globally, LG CNS gets 45% of its revenue from within the LG group, while the rest 55% come from non-LG group customers. The company operates on less than 10% profit margin.