Indian buyers handing out larger outsourcing deals, says Everest
Monday, November 08, 2021 3:22 PM

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Moumita Bakshi Chatterjee

New Delhi, Nov. 8

In a clear sign that Indian buyers are coming of age, the domestic market logged 26 outsourcing contracts in third quarter of 2010, same as last year, but annual value of the deals — measured in terms of annual contract value (ACV) — more than doubled.

The ACV added up to $290 million in September quarter 2010, as against $129 million in the corresponding period previous year, according to global research firm Everest. ACV is calculated by adding up total value of each contract divided by the duration of that contract.

According to Nasscom, the total domestic revenue for software and services is estimated to grow by 15-17 per cent during current financial year to Rs 76,100-77,500 crore (roughly $16.9-17.2 billion).

Everest's quarterly numbers capture only IT and business process outsourcing (BPO) services.

“Indian companies are maturing to a level where they are handing out large outsourcing deals, transformational in nature. Companies are going global and at the same time competing in local market with MNCs (multi-national corporations), and hence they are looking to aggressively leverage technology for growth,” said Mr Amneet Singh, Vice President-Global Sourcing, Everest.

Standalone project-based contracts are giving way to higher value enterprise wide-sourcing contracts, he said.

“The scope and scale is broader as Indian enterprises are giving out IT contracts which impact a greater part of business,” Mr Singh added.

Some of the prominent deals sealed recently include Jet Airways' business transformation and IT services agreement with IBM (NYSE:IBM) ; IBM has also bagged an outsourcing deal to manage Bharti Airtel mobile communications network spanning 16 African countries.

Among other notable deals, Wipro has bagged two large multi-year outsourcing contracts from Central Bank of India and UCO Bank for their regional rural bank rollout.

With 26 deals coming out of the domestic market, Indian buyers accounted for 5 per cent of the total global sourcing transactions in volume terms; as many as 503 deals were announced globally in the just-ended quarter.

“The share of the Indian buyers has remained consistent on a quarter-on-quarter and year-on-year basis,” he said.

IT outsourcing deals numbered 23, while three contracts were given out in the BPO space. The share of the Indian service providers in the local market deals during Q3 2010 was 65 per cent, and increased vis-à-vis 54 per cent share in Q3 2009.

Jet Airways' business transformation and IT services agreement with IBM

Wipro has bagged outsourcing contracts from Central Bank of India and UCO Bank

IBM has bagged an outsourcing deal to manage Bharti Airtel mobile communications network

(Source: )
(Source: Quotemedia)


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