Tech Mahindra to invest up to Rs 700 crore over the next 2-3 years

Says products and platforms unit can become a $1-billion business in the next 2-3 years

IT services major Tech Mahindra (TechM) on Friday said it would invest Rs 500-700 crore into the newly carved out products and platforms unit over the next 2-3 years. The company believes that the unit can become a $1-billion business in the same period.

“We had acquired Comviva a few years back,  which has been creating products and platforms for the telecom sector. A few months back we decided to merge all our other product and platform offering into Comviva,” said C P Gurnani, managing director and chief executive officer, TechM.  

He also added that Comviva’s standalone revenue stood at $200 million and the revenue from enterprise products and platforms was around $250 million. “All of these will now come under a single umbrella of Comvia, which we believe can reach $1-billion revenue,” he added at an investor meet.

TechM’s product and platforms will also extend to sectors like insurance, banking and financial services other than telecom. “We are largely leveraging existing customers and to co-create products with them,” said Vivek Agarwal, president, corporate development.

Agarwal said this may aid the company in improving its margins. TechM has been trying to improve its margin play for some time now.

As a part of the investor day presentation, the company said that it intended to increase its revenue contribution from the partner ecosystem to 40 per cent in a year, from the current 30 per cent. “To be able to improve our revenue from alliances and partnership from 30 per cent to 40 per cent we have to work better with our leading 10 partners. Some of these include SAP, Microsoft, Amazon, Oracle, Google. We have already set the process in action with our partners,” added Gurnani.

He also said that customers will be key in this too and it was already co-creating with Japan-based Sumitomo an offering for the auto sector in that geography.

The company also told investors that going ahead, it would focus on organic growth, margin expansion and driving portfolio synergies.