Ricoh India aims to quadruple revenues by end of FY17

Firm sees IT services biz growing faster than traditional ones

Ricoh India, a subsidiary of Japanese imaging and electronics Ricoh, is looking to grow its revenues from India four-fold by FY17-end, from the Rs 1,047 crore it reported in FY14 on the back of its recent wins in the government space and increasing traction of its IT services business in the domestic market.

In its previous three-year mid-term plan period-ending March 31, 2014, Ricoh India had set a target to triple its revenues which has already been achieved, said Manoj Kumar, Managing Director of Ricoh India. “For the current mid-term three-year plan period, of which one year has just finished, we have set a target to grow four times which means we will have to cross Rs 4,000 crore by March 31, 2017. This is an annual growth rate of 55-60 per cent which perfectly fits in to the pace at which we are growing today,” he said.

Much of this growth would be driven by IT services space into which the company, known for its hardware-centric approach, forayed in 2010. This was strengthened further in May 2011 when Ricoh India acquired a Noida-based company, Momentum Infocare Pvt Ltd. Kumar said that the share of IT services, which currently stands around 45 per cent of the overall business, is expected to cross 50 per cent in the current financial year.

“In Ricoh India, we are very actively pursuing the business of IT services. The genesis of that is we had the foresight to spot the trend at the right time, and therefore we shifted gear and adopted IT services as one of our business lines to not only complement our core business but also enable us grow IT services business in its own right,” Kumar said.

Ricoh India has its roots in hardware. Until about five years ago, the company used to deal only in office automation products and multi-functional devices such as copier, scanner, printer and digital duplicators. By adding business lines like IT services, production printers and laser printers, the company is positioning itself as an integrated solutions provider for the customers whether it is in government space or even in corporate.

Recently, Ricoh India has bagged a Rs 200 crore project from the Department of Education, Government of Delhi for the implementation and maintenance of ICT solutions across 1,100 schools in the state. Late last year, the company won a Rs 1,370 crore contract from Department of Posts for the supply of hardware solutions under the latter’s modernisation initiatives. Besides, the company was also responsible for some large e-governance projects like e-District in Uttar Pradesh, Tamil Nadu Health project, Karnataka Panchayati Raj project and Chattisgarh’s cloud-based tablet solution.

“We are active in the space of digitisation and in mission mode projects. We also have a strong customer base even in the corporate segment. But since you get high value deal in government space, it stands out prominently,” added Kumar.

To support the growth, the parent Ricoh in September last year infused around Rs 200 crore through non-convertible debentures. “When we are growing at a phenomenal pace, obviously our demands for funds are also increasing. The basic purpose is to keep the cost of borrowing down as the borrowing rates in India are much higher.”

Ricoh holds around 73.6 per cent in Ricoh India while the rest is held by public.