Tech Mahindra has bagged a $700-million contract from BT
Tech Mahindra, the sixth largest IT exporter, has bagged a $700-million con= tract from British Telecom (BT) for transforming and improving BT’s IT esta= te or infrastructure. This is one of the largest contracts that any IT comp= any has won in recent months. It also gives boost to Indian IT at a time wh= en the US subprime crisis and talks of slowdown had dogged IT services comp= anies.
For Tech Mahindra, the $700 million contract is the third big engagemen= t that the telecom services major has bagged from BT. Earlier, Tech Mahindr= a had won a $350-million contract and a $1 billion IT outsourcing deal from= BT.
When contacted, Tech Mahindra president for international operations CP= Gurnani said, “At any given time, we are chasing big deals and long-term c= ontracts, but this is purely speculative.” The company is due to announce i= ts annual results on May 19 and refused further comments on BT contract, ci= ting silent period requirements. Tech Mahindra’s share closed at Rs 933.45,= marginally up from its previous day’s close
BT is Tech Mahindra’s largest client. Its second largest client is Amer= ican telecom major AT&T, while Motorola and Alcatel-Lucent are part of = the software exporter’s top five clients. BT accounts for little under 60% = of the total business with Tech Mahindra. When asked about client concentra= tion risk, Mr Gurnani said, “Over the years, BT business has declined from = 90% to less than 60%. We have a large portfolio and we don’t look at it as = a client concentration risk. Instead, it’s a vote of confidence from BT.” =
About 70% of Tech Mahindra’s business comes from Europe and 20% from th= e US. “We have grown the US business in the last few years. Despite the re= cent crisis, US will remain the biggest trade partner for IT services compa= nies,” Mr Gurnani said.
Recently, Tech Mahindra also expanded its mobile virtual network operat= or (MVNO) client base by entering into IT partnership with FRiENDi mobile, = the MVNO in the Middle East and North Africa. Tech Mahindra will implement = FRiENDi’s mobile’s ERP, business process automation, reporting and web self= care systems, as well as community-based applications and value-added serv= ices.
Tech Mahindra broadly caters to three kinds of customers=97telecom serv= ice providers, independent software vendors and telecom equipment makers. T= he company is working with clients on Internet technologies to cover delive= ry platforms such as Wi-Fi and WiMax. T
hese three segments, along with associated IT and BPO services, cover t= he entire span of IT operations for telecom companies. This makes Tech Mahi= ndra a fully-integrated player, providing it with a significant competitive= advantage for IT related outsourcing business tasks in the telecom space
