IT services company Mphasis has seen its global deal pipeline double to USD 435 million as on Q3 FY18 from USD 276 million as on Q3 FY17, on the back of new technologies that the firm has been promoting.
“We started our own transformation in service delivery last year, using deep tech learning, cognitive solutions, and machine learning. We see that paying off. We have been able to record significant improvements for our clients also as a result,” Sundar Subramanian, President for Global Delivery, Mphasis, told Moneycontrol.
To accentuate the passage to innovative solutions based on new technologies, the company recently also partnered with Plug and Play Tech Center, a global startup ecosystem and venture fund specialising in the development of early-to-growth stage technology startups.
“Sometimes we don’t have the disruptive technology, so we benefit from these startups. Plug and Play has the most comprehensive portfolio under them, which is an advantage for us. This partnership will accelerate the co-creation of robust go-to-market solutions for enterprise clients. Vice versa, our market knowledge will be an advantage for these startups,” Subramanian said.
Through this partnership, Mphasis has the opportunity to work with 700 shortlisted startups to create next-generation solutions and also collaborate with over 200 Plug and Play corporate partners.
The company had earlier launched Sparkles, an innovation lab, to develop domain-specific solutions. Mphasis has already integrated solutions from several startups in its core offerings, including NoPasswords.com, an app that works with hidden multi-factor authentication solution to provide the most secure authentication solution and get rid of passwords. It is currently deploying the solution internally also.
“Hyper personalisation is our aim and focus now. All our clients are looking for automation and personalisation is an integral part of it. Every function requires a different set of data, different analysis and implementation. That’s where we are moving. We will look for solutions in these broad areas,” Subramanian added.
Mphasis counts top global banks, mortgage lenders and insurance companies among its customers. The company is now exploring the European region for expansion.
According to a report by ICICI Securities, Mphasis will see faster growth in DXC and Direct Core segments than the industry average in FY19, with Digital Risk revenues expected to be in the range of USD 28 and USD 30 million on a quarter-basis.
However, the brokerage firm expects eventual loss of momentum at certain large BFSI clients in the medium term. Currently, Mphasis’s client base is concentrated on top 10 clients constituting 55% of its revenues.
The company, on the other hand, is not worried. “We have a healthy deal pipeline and the HPE deal too is an advantage we have. We will be stable in this year,” Subramanian said.
HPE committed revenues to Mphasis for 11 years as part of the 2016 deal when it sold its 60.5% stake in Mphasis to private equity firm Blackstone. As part of the deal, HPE guaranteed Mphasis revenues worth USD 990 million in the first five years, increasing every year post the five-year period.
Before this deal, Mphasis had suffered a gradual decline in revenues. The HPE agreement arrested that and improved the company’s topline. Mphasis is also part of HP’s Preferred Provider Programme. With Blackstone also coming onboard, the opportunities for Mphasis have doubled.
(Corrigendum: A previous version of this article erroneously said "Mphasis has seen its global deal pipeline double to USD 435 million from USD 276 million last year". The error is regretted.)
