You talked about the $5 billion revenue target and also said it can be achieved just by maintaining the current growth rate of the company. Where does this confidence stem from at a time when the industry is going through a period of prolonged slump?
The industry definitely has headwinds because of the deflation that AI causes. But I believe at the same time that we as industry leaders have not done a good job of talking about the tailwinds that AI has created. There is a headwind, of course, because AI is a highly efficient technology that compresses large managed services contracts and as it mutates, as the agentic version comes out, it keeps compressing it more.
There are six clear tailwinds that exist and our confidence comes from the fact that we have changed the organisation in every aspect. The first one is the whole legacy modernisation. You can now drive transformation for CIOs, which you could not have. The second is cloud modernisation. Third space is security, which is not just cyber, but also AI risk management. Next is data.
Then some clients want advice on how to ingest AI, or how to create the ROI (return on investment) from the scattered tools they have. The last is how do you embed agents in workflows to be able to drive business process automation. So, a lot of that confidence also comes to the fact that we know these are discrete demand pools.
How do you view the future of IT services companies at a time when the LLM makers are themselves looking to set up some to enhance AI adoption in enterprises?
I don't see them as competitors, but partners. When I look at the world, I see the tech ecosystem having four layers. The bottom layer is the energy layer where there are firms who will create the electricity and the power needed to power the data centres. The next layer is the LLM players. There's a third layer which are these tools like Cursor that we need to work with. And then there's us who are business solution creators. LLMs will provide the intelligence. We have to provide the context. We have to use the tools and we have to deliver the impact.
They have done a much better job of articulating the intelligence, which is relatively new to the world, that they can give and how they see their total addressable market growing. We have to identify and articulate the new demand pools. If we start identifying them discreetly, there will be more credibility to the assertion that yes, we will grow very rapidly.
LLM players will never understand industries. That's not their job. Their job is to create the intelligence using technology. Our job is to also understand the industry, the specific context of the client and create solutions. I see this as symbiotic and not adversarial.
Is there a likelihood of acquisitions of services companies by the frontier model firms?
It could happen. But you look at the firms that they've acquired, they're really small AI native firms founded by somebody who came from that same ecosystem. I think services and LLMs have a very different mindset and a very different investment paradigm. In that industry, you invest like crazy. And then if you hit it, you hit a jackpot, else all of it gets eroded. In our industry, you invest and start getting returns almost at the same time. The margins are reasonably predictable and the risk is lower. So, these are two fundamentally different industries.
Would Coforge also look to invest in Indian LLM makers at any point of time?
I can invest in products, but I'm not going to invest in LLMs. I think it's a different human capital needed. It's a different orientation around investment and the returns you get from it. Our investors don't expect us to, let's say, pump in $50 million, drop our margins by two per cent and hope that we'll build an LLM that will compete with an Anthropic or someone else. The returns are huge, but the risk is huge as well. That's not what our investors want us to do.
 "Sudhir Singh, Chief Executive Officer (CEO) and Executive Director (ED), Coforge")