Intel Capital, the investment arm of Intel Corp., said Wednesday that it will invest $23 million in three Indian companies in areas ranging from online marketing to education.
The investment comes as Intel's revenues are shrinking and the global credit crunch has made funding, even to relatively fast-growing countries like India, increasingly scarce.
"We believe that we haven't even seen the tip of the iceberg as far as the market and business potential in India. We continue to be very bullish," Sudheer Kuppam, Managing Director of Intel Capital for India, Japan, Australia, New Zealand and South East Asia, said by phone.
The new investment will go to One97 Communications Pvt. Ltd., which provides value-added services like ring tones and games for mobile phones, IndiaMART.com, an online business-to-business marketplace, and Global Talent Track, a vocational educational institute.
Intel, the world's largest chipmaker, slashed fourth-quarter profit forecasts twice on flagging demand, and is now projecting a sales decline of more than 20 percent from the year-earlier period. The Santa Clara, California-based company is scheduled to report quarterly results Jan. 15.
Kuppam said Intel Capital invests, on average and excluding one-time large deals, about $500 million a year.
"You get much better value for your money in the current environment," he added. "We are going to be really active."
Funds will come from the $250 million Intel Capital India Technology Fund, which was established in December 2005 and has so far invested about 40 percent of its funds, Kuppam said.
Last year, Intel Capital invested about $50 million in 9 companies in India. That amounted to 8.5 percent of total funds committed globally, excluding a $1 billion investment in Clearwire Corp., an Internet provider specializing in a new type of wireless broadband technology called WiMax.
Intel Corp. employs about 3,000 people in India and opened its largest manufacturing site outside the United States in Bangalore, India, in 1998. Intel's investments in India to date have been over US$ 1.7 billion.
The company does not break down its revenues by country, but spokeswoman Saranya Rustagi said Intel has no plans to change the size of its work force in India as global demand shrinks.
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