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SEA demand for IT services continues boom, Malaysia's Hitachi Sunway finds

AvantiKumar | May 20, 2014
The JV between Malaysia's Sunway Group and Japan's Hitachi has expanded its portfolio to meet an expected 25% boost in overseas business by fiscal 2015, said Hitachi Sunway's Cheah Kok Hoong.

Mr Cheah Kok Hoong_Group CEO modified 

Photo - Cheah Kok Hoong, Group CEO / Director of Hitachi Sunway Information Systems.


The joint venture between Malaysia's Sunway Technology and Japan's Hitachi, Hitachi Sunway Information Systems [Hitachi Sunway], has continued to expand its portfolio to meet an expected 25 percent revenue growth from its Southeast Asian business, said the IT services provider.

After starting its operations in April 2013, demand in emerging markets in Southeast Asia (SEA) has fuelled an expansion of its strategy for the next two years to meet a new revenue target of RM137 billion (JPY 4 billion; US$42.65 billion) by fiscal 2015, said Hitachi Sunway group chief executive officer/director Cheah Kok Hoong in Kuala Lumpur.

Cheah said the company has been growing in "a most synergistic manner" since its launch by meeting significant regional opportunities in the IT infrastructure sector.

"For Hitachi Sunway, the three markets that are fuelling our regional business growth are mainly Indonesia, Vietnam and Thailand," he said. "We identified significant opportunities to extend our system integration (SI) expertise across in these three countries across industries to support demand for large IT infrastructure developments."

 "Global research shows that more than half of the world's growth over the next few years will come from emerging market," said Cheah.  "We see continued high demands for IT solutions and SI services, in parallel with the business and national developments within these emerging economies - especially as organisations seek to improve their IT infrastructures to support business modernization and higher productivity for better competitiveness."

  International investors drawn to SEA

Cheah said many multinational companies [MNCs] especially Japanese-owned groups are proving to be large investors in the SEA market.

"These companies are eager to establish their footprints in these SEA markets, and they are looking for ideal IT partners like Hitachi Sunway that has an on-site presence in multiple ASEAN countries to comprehensively support their regional expansion, operations and IT needs," he said.
The first stage of Hitachi Sunway's SEA business expansion plan started with Malaysia, Singapore and Thailand, said Cheah. "Hitachi Sunway is now in the second stage focusing on three markets including Indonesia, Vietnam and the Philippines, to continue fuelling the regional business growths."

"Currently our businesses in most of these countries have already been established with steady demands for IT projects. As mentioned, we expect this to ramp up our overseas business by 25 percent in fiscal 2015 and continue contributing to our combined regional revenues for moving forward," he said.

Last month, Hitachi Sunway officially launched its latest business base in Hanoi, Vietnam with the aim to further capitalize the country's surging IT demands in the local market, said Cheah.
"Vietnam's economy is growing on a spectacular basis in the country due to its large domestic market and is becoming the go-to destination for outsourced manufacturing," he said. "Hitachi Sunway expects this to drive the demands for our IT solutions and services by multinationals, enterprises and Japanese companies operating in Vietnam."

Strategic collaborations

In addition, Hitachi Sunway has formed several strategic collaborations to strengthen its solutions portfolio. Its recent partnership with SAP Ariba is an example to quickly and effectively offer breakthrough Cloud solutions in delivering simplified IT services.
 "Today, for most enterprises in Malaysia, IT systems infrastructure is already a given basic foundation for their business operations. However, with the advent of Big Data and Mobility, they are now focused into optimising their existing IT infrastructure to improve productivity and lower cost to meet the fast changing market dynamics," said Cheah.

"Hitachi's fee-based Cloud offering facilitates this by allowing an effective delivery of IT solutions and services on a fixed monthly fee rather than usage-based billing," he said. "Through this model, our customers can be freer in acquiring the IT solutions that they need without worrying over capital expenditures."

In Malaysia, for fiscal 2014, Hitachi Sunway will remain focused on incremental business opportunities in Financial Services as the No.1 development sector, followed by Oil and Gas, Manufacturing, and Architecture, Engineering & Construction (AEC) as the other major business areas.  

In line with the JV's overall growth fueled by regional business expansions, Hitachi Sunway has raised its employment headcount by 21 percent with 200 employees based across Malaysia and other offices in SEA.


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