Capacity expansion seems to be back on the radar of IT and BPO services providers. UST Global and CSS group announced opening of their delivery centres in Philippines on Tuesday. Both companies will add about 7,000 people in the country in the medium term to cater to North American and European customers.

UST Global inaugurated its development centre at McKinley Hills in Philippines. The company will hire about 1,000 IT professionals in the next one-year and hopes to add about 5,000 employees in the medium term.

On the other hand, CSS announced the launch of its fully operational 1,000-seat service delivery unit in Manila. The facility has capacity to house 2,000 people and will offer multi-lingual, retention, technology and integrated BPO services.

CSS is investing in new verticals such as retail, travel and hospitality, logistics, hi-tech internet and communications. “The company is in the process of increasing its global footprint in tech support, its core area of expertise,” Nick Sharma, chief executive officer of CSS, said in a statement. Both companies already have presence in the country.

“The expansions in Philippines signifies the movement of low-end work from India,” JRS Reddy, head of financial accounting operations, Sutherland, said in a recent interaction with Financial Chronicle. “As Indian companies mature in offering IT and BPO services, countries including Philippines and a few Latin American players will takeover basic outsourcing jobs,” he added.

The global marketplace is showing signs of slow recovery since the last quarter. Some companies including Polaris Software lab lost revenue opportunities because of high utilisation rate and limited resources.

“The market is picking up and we got 30 wins in a quarter. As our efficiency in India was working at a highest peak at 81 per cent level, we do not have capacity for growth immediately,” Arun Jain, chairman and chief executive officer of Polaris, said.

“Last quarter we recruited about 300 freshers. We need to fulfill the huge funnel of 1,000-people requirement. We observed this demand and now we can take some decisions and (make) some investments in the current quarter,” he added.