Tech Mahindra is shifting its focus away from telecom vertical to IT services as it gears up for the impending merger with Satyam Computer.
According to the management of the mid-tier software firm, the merged entity would be more of an IT services firm.
Ahead of the merger, Tech Mahindra, the only IT company in the country to focus more on BPO, is also in the process of integrating BPO with new IT growth verticals such as cloud, analytics and platforms and services, according to the company officials.
L Ravichandran, president, IT services, Tech Mahindra, told DNA Money, “The new entity with reinforced leadership will have a single ‘go-to-market’ strategy with deep competencies and focus on NMACS, a unified business transformation platform jointly unveiled by both the companies and consisting of industry reference models for analytics, cloud, mobility and security.”
Experts see sees a huge growth potential in these new-age verticals in the next 3-5 years.
Tech Mahindra has tools in place for the shift to an IT-focused entity, with a telecom portfolio on the side, they said, adding that the loss of BT as a key investor is also set to fuel the shift.
The merged entity will provide a balanced mix of revenues from telecom, manufacturing, technology, media & entertainment, BFSI, retail and healthcare verticals.
“Our strategy is to invest in IP and continuously innovate in our offerings and services, grow in our focused markets and leverage on the Mahindra Group capabilities,” Ravichandran said.
The company has made some strategic acquisitions, including UK-based Hutchison Global Services, and mobile solutions provider Comviva, that has helped it in expanding capabilities and offerings.
“Besides, 99.99% uptime is indeed a challenge and the key goal of BPO companies. These have benefited our clients and are now our reference points which also fuel our growth graph,” he said.
The merger would create an offshore services major with around $2.5 billion in revenues and 80,000+ associates.
In the short term, Tech Mahindra is upbeat on IT services segment despite guidance cuts by software industry body and companies including Cognizant.
The company is confident of increased growth from US markets, which contributed 33% to its revenues in the second quarter, despite sluggish business in Europe. It is also gunning for more mid-sized deals to ensure consistent growth.