Business process outsourcing company Aegis is not looking to exit its Srinagar operations

Business process outsourcing company Aegis said it is not looking to exit its Srinagar operations, even as it continues to talk to the local government and customers for generating new opportunities.

“We’re clear we are not exiting this geography,” Sandeep Gulati, chief operating officer, APAC and South Africa, Aegis, told Moneycontrol.

Local news reports had said last week that Aegis was going to wind up operations in Srinagar, asking 230 employees to look for other options.

Aegis has been present in Srinagar since 2010. It started operations with 40 people and expanded to about 400 in the next two years.

“There is huge talent in this geography. Their spoken English is good, and the employees have great commitment,” said Gulati.

Gulati said that in spite of the unrest in the state, the Aegis facility has always been peaceful, with little to no impact on operations. He added that the attrition in the region is also sub-5 percent, and that the employees are very professional.

Regarding the news of the layoffs, he added that it was part of regular restructuring as their clients consolidate their operations and new players enter the market.

“There is a bit of stagnation in the region. We are having discussions with our clients in the telecom and banking sectors, but I don’t think we’re out (of Srinagar) yet,” Gulati added.

He also said that the company was talking to the local government regarding business challenges in the region.

Jammu and Kashmir had revised its minimum wage in November 2017, from Rs 5,500 to Rs 10,500. BPO firms have pointed out that such minimum wage increase being undertaken in states across the country is going to impact the already small margins of the BPO industry.

The labour intensive nature of the work done by BPOs means that their bottom line will take a hit.

Aegis, earlier part of the Essar Group, was sold last year to private equity firm Capital Square Partners for Rs 2,000 crore.

The company is a significant player in the BPO space, growing through a mix of organic growth and strategic acquisitions. The company has a global footprint across nine countries – India, South Africa, Australia, Saudi Arabia, UK, Argentina, Sri Lanka, Peru and Malaysia.