Tech Mahindra is in a unique position in the Indian IT industry. While most of the industry makes its revenues in greenbacks and wishes that it was making more in other currencies, Tech Mahindra earns close to 70 per cent of its revenues from Europe—of which about 61 per cent come from British Telecom. As a result, a bulk of its Rs 970.4 crore third-quarter revenue came in British pounds. That still does not mean that Tech Mahindra has no worries on the currency front. The reason— the rupee appreciated 3.6 per cent against the pound during the last three months of the year.
Tech Mahindra is, for the moment, not overtly concerned. The company believes that with better utilisation and hedging adjustments these problems can be overcome. For now, Tech Mahindra is focussing its energies on geographical expansion in Europe and Asia and is looking out for acquisitions.
“We are looking out for growth in continental Europe. Scandinavia is a region we are seriously looking at. It’s tough to grow organically in Scandinavia as there are regulatory issues there. Language is also an issue and, therefore, we are looking at acquisitions,” says Rajesh Chandiramani, General Manager, Sales and Marketing, Tech Mahindra. “Israel is another geography that we are looking to grow in,” he adds.
Asia also has been a key area of growth for Tech Mahindra, in particular markets like Indonesia and Thailand. Tech Mahindra’s revenues grew 33 per cent, 22 per cent and 46 per cent in the US, Europe and rest of the world region, respectively, in the third quarter. The company has 23,155 employees, of which 18,448 were software professionals while 3,704 were in the BPO business.
— T.V. Mahalingam