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Aditya Birla Minacs to turn profitable in a year

Aditya Birla Minacs to turn profitable in a year
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First Published: Mon, Jun 23 2008. 10 45 PM IST

New opportunities: Dev Bhattacharya of Aditya Birla Minacs
New opportunities: Dev Bhattacharya of Aditya Birla Minacs
Updated: Mon, Jun 23 2008. 10 45 PM IST
Bangalore: The back-office unit of the diversified Aditya Birla Group, Aditya Birla Minacs Worldwide Ltd., expects to turn profitable in the next fiscal year as it expands services such as data analytics and market research and adds more customers in countries including the Philippines and China, apart from India.
New opportunities: Dev Bhattacharya of Aditya Birla Minacs
The company, known earlier as TransWorks, acquired Canadian business processing outsourcing (BPO) firm Minacs Worldwide Inc. in August 2006 for $125 million (Rs575 crore at the then prevailing exchange rate) and completed the integration of operations last year.
“Now we are on a break-even path and 2009-10 time frame should be a good thing for us,” said Dev Bhattacharya, managing director of Aditya Birla Minacs, without disclosing the extent of accumulated losses .
“The losses mainly pertain to the acquisition costs,” he said.
The company, which has taken just five years to become the country’s third largest back office services provider in revenue terms, aims to be a large listed company in three more years, Bhattacharya said.
Aditya Birla Minacs clocked revenue of $392 million (or about Rs1,575 crore) in the year to March 2008, a 17% rise over the previous year’s $335 million. “For the current year we aim to grow between 15-20%,” Bhattacharya said, with growth mainly coming from the Asia-Pacific region that currently accounts for less than a fifth of its revenue.
“We expect Asia-Pacific to grow faster than North American market, where recessionary trends have slowed down growth,” Bhattacharya said.
North America accounts for more than two-thirds of the revenue for Aditya Birla Minacs, which serves customers such as General Motors Corp. and Nova Scotia Business Inc. in verticals including automotive, telecom, financial services, insurance and technology.
The Minacs buyout helped the company to sell a combination of both near-shore and offshore services.
However, appreciating currencies in India and Canada prompted it to look at newer markets and offer more services such as data analytics, Bhattacharya said.
The rupee’s steep appreciation against the US dollar last year hurt Indian outsourcing companies by reducing the local equivalent of every greenback they earned.
Next year, Aditya Birla Minacs expects to tap the Chinese market in partnership with existing clients, Bhattacharya said, acknowledging language and cultural barriers in cracking the market open.
The company is focussed on building capabilities in Asian and Hispanic languages to support large clients and is exploring options to build delivery centres in Latin America, Western Europe and the Philippines, besides smaller cities in India.
The firm, which serves Aditya Birla group companies in sectors such as telecom and insurance in India, is eyeing business outside the group mainly in telecommunications and financial services.
“Growing non-voice business in areas such as data analytics is the logical expansion for companies such as Minacs that have strong domain competencies,” said Sabyasachi Satpathy, senior director at NeoIT.com Inc., an IT advisory firm. Non-voice opportunities are sustainable, large and relatively more profitable than voice services.
Aditya Birla Minacs employs more than 13,000 people across 30 facilities in Canada, Germany, Hungary, India, the UK, US, and the Philippines. It provides services in 28 languages and expects to add about 2,500 employees in the current year.
Minacs earns about three-fourths of its revenues from voice services, a share it expects to decline to around 60% in three years as it expands non-voice business such as data analytics.
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First Published: Mon, Jun 23 2008. 10 45 PM IST