OPEN APP
Home / Industry / Infotech /  Macroeconomic factors impact but unlikely to stall critical tech modernisation
Listen to this article

Amid fears that the global economy may be facing an increased risk of recession, Mindtree's CEO Debashis Chatterjee has said that macroeconomic and geopolitical developments are unlikely to turn back or stall business-critical technology modernisation.

There could be "momentary impacts" on the pace of decision-making in certain sectors, he said but technology is bound to remain "at the heart of competitive advantage, market relevance, and business resilience" with organisations across industries going all out to drive innovative outcomes, continuous differentiation and sustainable growth in the new normal.

Few large global tech companies are already pulling back on aggressive hiring plans over concerns of a looming economic slowdown.

Chatterjee answering a question regarding haw the global tech budgets will fare in coming quarters given high inflation and macroeconomic worries said, macroeconomic and geopolitical developments are unlikely to turn back or stall business-critical tech modernisation.

In an email interaction with PTI he went on to state that headwinds spur organisations to free up dollars from areas of inefficiency and redeploy them on initiatives with assured return on investment

Citing this reason he went on to say, “This invariably drives greater technology-led innovation. Our robust first quarter performance has reinforced confidence in our ability to continue our growth momentum,"

On the question of signs of global slowdown, the CEO of the tech company said, there are "no indications yet of any significant change in client behaviour".

"Digital transformation is not a one-off project, but an ongoing imperative," he observed.

He pointed out that the firms will leverage opportunities created by the client's need based on close monitoring of macroeconomic developments to balance cost and digital imperatives.

There are no indications yet of any significant change in the long-term plans of clients, “barring a handful of them in consumer-facing segments deferring spends," answering to whether some verticals are susceptible to larger macroeconomic concerns or seeing a slowdown in decision-making.

Yet, it is early days to read a pattern in that, he added.

Chatterjee went on to say, "We are continuing to engage with our customers and see where we can help them both on the cost-saving as well as the digital transformation mandates."

Last month, Mindtree reported over a 37 per cent rise in net profit for the June quarter as the IT company's net profit stood at 471.6 crore in the April-June quarter against 343.4 crore a year ago.

A company said that it is "confident" of growth momentum for the fiscal's first half and cautiously optimistic about the second half.

Revenues for the current fiscal's first quarter came in at 3,121.1 crore, logging a growth of over 36 per cent year-on-year.

Merger of Mindtree and LTI

The merger of LTI & Mindtree will create a $3.5 billion company.
View Full Image
The merger of LTI & Mindtree will create a $3.5 billion company.

Earlier this year, Mindtree and LTI (Larsen & Toubro Infotech), the two software units controlled by the Mumbai-based engineering conglomerate, announced a mega-merger to create an efficient and scaled-up IT services provider, exceeding USD 3.5 billion in total revenue.

Talking about the benefits the proposed merger will bring, Chatterjee stated, "By unlocking scale benefits, a stronger portfolio of offerings across verticals, enhanced customer engagement, and streamlined delivery processes, the merged entity will be able to participate in larger deals, strengthen partnerships with ecosystem players and create a more distinctive employee value proposition".

With inputs from PTI.

Catch all the Industry News, Banking News and Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Subscribe to Mint Newsletters
* Enter a valid email
* Thank you for subscribing to our newsletter.

Recommended For You

Trending Stocks

×
Get alerts on WhatsApp
Set Preferences My ReadsWatchlistFeedbackRedeem a Gift CardLogout