Digital space to be growth engine in next 5 years: Mindtree

Mindtree expects to meet its guidance of 10-12 percent for FY16 given increasing demand in digital space.In an interview to CNBC-TV18, Krishnakumar Natarajan, CEO of Mindtree, says digital will be the growth engine for company in the next 5 years.

Citing currency volatility as a dampner, Natarajan says the company’s first quarter revenue will be impacted by about 0.5 percent.The company looking at players in the consumer facing segments in North America and Europe for acquisitions, he said.Below is the transcript of Krishnakumar Natarajan’s interview with CNBC-TV18's Poornima Murali

Q: What is your outlook for the company in FY16?

A: As we start the year we see the demand momentum still being quite positive.One way of looking at the demand is really if you look from a customer viewpoint there is a set of investments budget they have for running the business. Clearly customers are looking for more cost efficiencies on that. They want more productivity.So, we don’t anticipate a big growth in revenue numbers in running the business because the customer’s need is more efficiency. But primarily customers are not demanding efficiency to save but they clearly are demanding efficiency to invest those savings; in more what you call discretionary spend particularly in areas like digital transformation.So, clearly we see a strong uptake in digital and any discretionary spend which clients are doing which is very positive for Mindtree because that is an area of strength for us and which is also the reason why we believe that the guidance of 10-12 percent we would be able to meet but what could be a little bit of a dampener in that is really the way in which currencies could really play out because clearly the currencies have been quite volatile. My presumption is that even in quarter one it could have maybe half a percent impact on revenues.Q: In terms of acquisitions what are the geographies that you are looking at and what are the verticals that you are looking at to go ahead with acquiring companies?A: Clearly what we believe is that the whole notion of discretionary spends is really happening in industry segments which are facing consumers and particularly in our case it is retail consumer products, it is hi-tech consumer as well as the BFSI segment and travel and hospitality.