US-based Altair Engineering, a provider of simulation technology and engineering services, is in the process of making two sub-$10 million acquisitions in the next six months, according to Pavan Kumar, managing director (India and ASEAN). The firm has development centres in Bangalore and Pune.
“So far, we have followed an acquisition strategy to acquire technology and not just increase our market share. We definitely have a few companies on our target list, which do have India operations. One of the deals may materialise by the end of this month and the other between June and July 2011,” he told Business Standard.
Kumar said the company would fund the acquisitions fully through internal accruals. He added that a couple of areas needed to be strengthened. These included power train (automobile) and fluid flow, besides other domains that it felt would have a future. Currently, Altair garners 60 per cent of its revenues from the automobile sector, 20 per cent from aerospace and the remaining from consumer electronics and others.
“Given that simulation technology is being endorsed by more and more practitioners, we see overall growth, especially in the non-traditional markets (heavy engineering domains). However, the consumer goods segment will grow much faster than automobile and aerospace,” he added. Globally, the size of simulation and mechanical simulation market is pegged at $4 billion. It stands at $500 million in India. The industry is growing at a compounded annual growth rate of 18 per cent in developed economies like the US and Europe and 35 per cent in India and China.
A 1,500-strong company, Altair employs about 800 people in Asia Pacific, including 400 at its Bangalore and Pune centres. “Given the current trends, we are planning to increase our headcount by close to 25 per cent in Asia Pacific over the next two years,” Kumar said, adding the company was projecting revenues of $180 million (around Rs 690 crore) this financial year, as against $152 million (Rs 817 crore) last year.