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NASSCOM is bullish that the IT industry (services) will grow at around 13-14% during the current fiscal. The industry body also said that the industry will touch $225 billion by 2020. The three main drivers will be new vertical, new geographies and newer customers.
Speaking to reporters after addressing at NASSCOM's EmergeOut Conclave 2013, Som Mittal, president, NASSCOM said that the industry has been growing at around 12-13% CAGR till two years back and reaching the $225 billion target (service business include both exports and domestic market) is a large number but still the industry can achieve it.
The first main driver will be newer geography. At present US, UK and other European markets contribute to around 90% of the total business, while the rest of the countries contributes around 10%, where the growth is. These markets include Asia-Pacific, China, Africa, Latin America and even the domestic market in India.
For instance, according to Mittal, “only three% of the business we do in China and Japan, which shows there is plenty of opportunities in those markets,” said Mittal. Many small companies have now started focussing only on these markets.
“Our estimate is around 20% of the business would come from new geographies by 2020,” said Mittal. At present the non-traditional markets contributes around 10%.
The second driver will be new verticals. At present BFSI, Hi-tech & Telecom and Manufacturing contributes around 80% of the business, while utilities, transport, health care and media & entertainment is growing fast and opens up new opportunities. “Not that the existing verticals will have a set back. The growth will not be at the cost of others, it will be an an expansion,” said Mittal.
The third driver will newer customers, especially SMB companies, said Mittal.
