We added a net of more than 3,400 Mindtree Minds in Q1, our highest-ever quarterly net headcount addition, says Debashis Chatterjee, CEO & MD, Mindtree
Bengaluru-based information technology (IT) services firm Mindtree Ltd recently announced its fourth consecutive quarter of profitable growth. The order book, at $0.5 billion, was the highest in its history. But challenges remain as travel and hospitality, one of the key verticals, is yet to return to full growth potential. In an interview with Mint, Debashis Chatterjee, chief executive officer and managing director, Mindtree, shares his view on the demand environment, key growth drivers and strategy to hire and retain top talent. Edited excerpts:
How do you see the demand environment in the quarters to come?
We have started FY22 on a strong note with an outstanding Q1 revenue growth of 7.7% q-o-q (quarter-on-quarter) and 22.6% y-o-y (year-on-year). Our growth was broad-based across service lines, industry segments and geographies. Our order book of $0.5 billion is the highest ever in our history. We have successfully sustained profitable growth momentum for four consecutive quarters and closed with a net TCV (total contract value) of $504 million for Q1 despite a challenging environment. This affirms that our disciplined execution of our strategy and investments in strengthening our capabilities and partnerships are yielding positive results. Digital transformation was already underway before the pandemic struck. It has now become a matter of priority. There is growing emphasis on customer experience initiatives, cloud and platform-driven operating models, intelligent decision-making and automation. As a result, our digital expertise, omnichannel approach and domain knowledge are especially in demand today. This is helping us gain market share and differentiation. We are confident in our ability to deliver industry-leading double-digit profitable growth in FY22.
What kind of contracts are you focusing on in terms of size and tenure?
We are increasingly signing multi-services and multi-year deals. We make sure to align with the needs of our clients to maximize efficiency and remain focused on the target markets as we partner with them on their transformation journeys.
What factors make Mindtree stand out among larger competitors when scouting for a deal?
Our born-digital heritage, agility and focus are among our key differentiators. Our 4x4x4 strategy focusing on four industries, four service lines and four geographies to drive superior growth, strengthen capabilities and expand strategic partnerships has been key to our success and is resonating very well with clients. We continue to incubate deals by mining strategic accounts, as it has helped us build on our differentiators and tap into growing opportunities to cross-sell and up-sell. Clients are looking to work with partners who bring the required capabilities and nimbleness.
Our strategic approach of redefining possibilities to build digital resilience through initiatives such as ‘Help and Grow’ enable us to drive accentuated client focus and build deep, long-term relationships with them.
Which verticals are among your key growth drivers?
All industry segments showed healthy growth in the first quarter of FY22. Our communications, media and technology (CMT) business grew 6.9% sequentially on the back of growing opportunities in revenue acceleration, efficiency optimization and cybersecurity programmes. Client focus on data-driven omnichannel customer experiences and workplace modernization led to our retail, CPG (consumer packaged goods) and manufacturing (RCM) business growing 7.7% sequentially. Both CMT and RCM continue to witness strong demand.
We are happy to report that our banking, financial services and insurance (BFSI) business, where revenues rose 6.4% sequentially, is returning to growth.
Travel, transport and hospitality (TTH) grew 13.1% sequentially, helped by our client relationships and diversification strategy. Healthcare, our newest industry group, contributed $3 million to our revenue. We are very upbeat about the opportunities ahead of us.
Considering that TTH was the worst hit by the pandemic, when do you expect it to return to its full growth potential?
TTH was most impacted by the pandemic, but is now showing early signs of recovery. Volumes are picking up. We expect vaccinations and easing of travel restrictions to provide further boost to the sector. For clients, it is no longer just about cash conservation. Their focus is shifting to discretionary spend that has a direct bearing on customer experience, outreach, revenue growth, business resilience and security. For example, a leading global travel software and technology company recently selected us as a strategic partner to modernize their entire passenger reservation platform and accelerate their cloud transformation journey. A global travel management company has chosen us for a multi-year, end-to-end cloud migration and cloud operations programme to drive its new business and product strategy. While our TTH business has seen double-digit growth for the past three quarters, we are cautiously optimistic about the sector as it is hard to predict the impact of future variants of the virus.
What’s your strategy to hire and retain the best talent?
We added a net of more than 3,400 Mindtree Minds in Q1FY22—our highest-ever quarterly net headcount addition—to close the quarter with a global headcount of over 27,000. Hiring will keep pace with the growing demand for our services. We expect our intake of both campus and lateral hires to go up. Fresh graduates will continue to be an important part of our talent acquisition programme. Domain-centric careers in emerging technologies appeal to today’s talent. Our focus is on providing them opportunities and motivation that are aligned with their expectations. This is how we are attracting and retaining the right talent. Our robust pipeline and order book would warrant increased hiring in the areas of cloud, data analytics and security.
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