Infosys says BPOs to outpace software business

Infosys BPO, the business process outsourcing arm of India’s second-largest software firm, sees the BPO industry growing at a faster clip than the IT sector, with the outsourcer itself confident of crossing the 11-14% growth forecast by Nasscom for the next fiscal.

Ritesh Idnani, chief operating officer, Infosys BPO, told DNA at the Nasscom India Leadership Forum, “Though it is difficult to give a number, but we are confident our growth will be higher than what has been predicted by Nasscom.”

He said BPOs need to leverage technology to drive specialisation to exceed the projections of Nasscom, the apex body of software services providers.

Idnani said the company sees healthcare contributing significantly to its revenues in the coming years, thanks to the health reforms in the US.

“Going forward, we expect healthcare to lead revenue growth, followed by the retail sector, while BFSI is expected to be stable,” he said.

Vertical-wise, manufacturing at 35% contributes the highest share to Infy BPO’s revenues, BFSI is second at 32%, while telecom makes up 16-17% and healthcare 5%.

Idnani said attrition is expected to remain under 30%, thanks to several employee-management interactive opportunities by the company. 

On threat from Philippines, he said India still has edge as a more mature market.

“I do not view Philippines as a threat. In fact, we have just expanded our footprint in Philippines, employing 1,500 people, with a 6% contribution to revenues,” he said adding that the market is an opportunity for India in terms of providing additional skill sets.

“We want to be the bridge connecting our global clients to new geographies like the Philippines, which will help us to grow our global footprint,” he said.

On opportunities in Tier-II and Tier-III cities, Idnani said though the rural BPO market did not contribute a significant proportion to the company’s revenues, going forward it will provide an alternate channel to add value for clients. “We are focusing on building skill sets in this area,” he said.

Identifying convergence as an emerging opportunity, he said, “The triple convergence of analytics, consulting and BPO will drive specialised demand for outsourcing.”

While traditional verticals were witnessing a slowdown, there are segments within them that are driving growth, as Infy was seeing increased traction from cable & wireless within the telecom vertical.

Emerging markets which have contributed to higher revenue growth are also veering towards specialisation, though the trend is not broad-based yet, he said.