Good Q1 start has set the tone for growth this fiscal: Mindtree CEO

In a Q&A, Debashis Chatterjee talks about the growth drivers, how the company's 4x4x4 strategy has panned out and the rising attrition

IT firm Mindtree reported a total contract value (TCV) at $504 million for the June quarter (Q1FY22), the first time it crossed the half-a-billion-mark. Debashis Chatterjee, CEO & MD of Mindtree, talks about the growth drivers, how the company’s 4x4x4 strategy has panned out and rising attrition in an interview with Shivani Shinde. Edited excerpts

What has been some of the key drivers for this quarter growth? And how much of this growth is attributable to the 4x4x4 strategy announced a few quarters back?

This is a good start for the financial year, as Q1 sets the tone for growth. This is also the third quarter of over 5 per cent sequential growth. The most important aspect of this quarter was its was broad-based, across verticals and geographies. We had come out with the 4x4x4 strategy, and one of the point was to stay focused on which industries we want to play in, which geographies and what are the service lines. We are aggressively executing on this strategy and it is reflected in the order book. Moreover, our service lines are aligned to the demand coming from areas such as cloud and digital transformation.

Your travel and hospitality sector has also seen double digit growth. Is it back to the pre-pandemic levels?

Travel was 17 per cent of Mindtree’s revenue pre-pandemic, but this one vertical was impacted in a big way. The base of this vertical in the revenue contribution has come down. We however stayed close with the clients, so though our revenue came down we did not lose any clients. Now as some of them redesign their operating models we become their natural partner in business transformation. Travel has rather grown 10 per cent sequentially in the last three quarters. But this still does not give us a peek into by when this sector stabilises. We are cautiously watching it.

One of the focus areas of the 4x4x4 strategy was the company’s foray into healthcare (HC) vertical. How is that playing out?

The strategy has been rolled out and now well entrenched in the company. We have a good pipeline into healthcare, we have a team and a leaders also in place. There were two reasons why we forayed into HC; one is that some of the existing clients are entering into the adjacent areas of HC. And two, we feel as the disruption happens in HC, the disruptors will need to have good capability in cloud, digital transformation and so we decided to get into it. Since we are seeing a good pipeline we started calling out the numbers as well.

How does the NxT acquisition help Mindtree?

NxT is into Internet of Things (IoT) and industry 4.0 capability and which they have implemented across L&T. The reason why we acquired was because IoT and Industry 4.0 is becoming very critical for manufacturing and some other verticals. This has further been accelerated due to pandemic. By acquiring this capability, we can take this to many of our clients. This helps us to address demand from many of our existing client base.