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Indian IT Services Reimaging Growth in the New Normal #3: Shopping Spree gathers momentum for Indian IT Services fueling expansion in the #newnormal

Blog: NASSCOM Official Blog

Indian IT Services Reimaging Growth in the New Normal

A blog series by NASSCOM Research to highlight trends that are driving the growth for Indian IT services in the new normal

#3: Shopping Spree gathers momentum for Indian IT Services fueling expansion in the #newnormal

The Global M&A Trend, gathering steam with Indian IT companies

In my previous blog “Mergers and Acquisitions – A key growth strategy for technology companies during the Covid times July 2020” I wrote about how global technology companies which were sitting on huge cash reserves had started to leverage acquisitions taking advantage of the fall in valuations during the pandemic.

This trend started for Indian IT companies in July 2020 with Wipro and LTTS which announced acquisition of IVIA Serviços de Informática (Brazil) and Orchestra Technology (USA), respectively. And post that there has been many more acquisition announcements.

Indian IT Services’ M&A Story driven by New Focus Areas    

Though, the larger Indian IT companies have been more in favor of organic growth, they have been making some strategic acquisitions every year, and this year that run rate seems to be inching higher.

Also, something that is making acquisitions this year different is the focus on newer areas and geographies.

Last year, acquisitions strategy focused heavily on building new capabilities in niche areas of digital, design and IP portfolio. And market expansion focus was mainly towards the US and the UK.

Key Acquisitions by Indian IT Services Companies – 2019

Source: NASSOM’s Technology Sector in India 2020, TECHADE, THE NEW DECADE, STRATEGIC REVIEW


So how has the story changes so far in 2020? Why this shift towards Inorganic growth? And what are these new focus areas?


The shift towards Inorganic Growth

What most Indian IT companies are witnessing post the pandemic is an increasing deal pipeline which is primarily driven by digital transformation deals.

An analysis of these deals from 1QFY21 showed that majority of these were in the areas of cloud, workplace and collaboration tools, customer experience, cyber security and automation which were emerging as the new spending themes for enterprise clients. (Read more details: “#Technologynews – The 4 Cs driving the client spending for Indian IT Services”. And this focus doesn’t seem to be changing as we see company releasing their deal details for this quarter.

So what this means is that to meet the capability demand for these new focus areas – the best way is to acquire niche companies that are experts in these domains.


The shift towards newer domain areas, verticals and geographies

If we look at the acquisitions that the companies have done so far in 2020, the focus on new digital areas is clear; another thing that is coming to the fore is that in addition the core markets i.e. the US and the UK, Indian IT Services Companies are expanding their footprint in newer geographies such as South America, Australia and European Markets.

Cloud and Customer Experience and are the leading focus areas for acquisitions



($250 million)

Utah, USA  Salesforce consulting company with offices across the US and Australia 

Agile Digital and cloud-first digital transformation

Kaleidoscope Innovation 

($42 million)

Ohio, USA Product design and engineering, UI/UX design, CX   

Medical devices, Consumer and Industrial markets

Guide Vision 

(€30 million)

Prague, Czech Republic ServiceNow capabilities for its clients in Europe 

Cloud-powered enterprise transformation

Blue Acorn iCi 

($125 million)

South Carolina, USA Adobe Platinum Partner in the US 

CX, digital commerce, analytics, and experience-driven commerce services


(€68 million)

Mechelen, Belgium Salesforce Platinum Partner in EMEA 

Sales & marketing automation, CRM and business analytics

IVIA Serviços de Informática Ltda 

($22.4 million)

Northeast, Brazil 


System development, maintenance, consulting and project management services in Brazil 

Financial Services, Transportation, Retail, Healthcare, Consumer Goods and Manufacturing

Rational Interaction Washington, USA A full-service digital customer experience (DCX) company 

Strengthen digital marketing products suite

Eximius Design California, USA Semiconductor Software and Systems Design 

Services for building smarter, smaller and faster-connected products for various use cases of IoT, Industry 4.0, edge computing, cloud, 5G and AI

IG Partners 

(AU$14.8 million)

Australia Enterprise Asset Management Solution and Mining 4.0 solutions for the Energy and Mining Industry
HCL Technologies
Cisco’s SON tech 

($49 million)

Global 5G tech deployment in telecom industry
DWS Limited 

(AU$167.9 million)

Australia IT, business and management consulting in Australia and New Zealand 

Digital Transformation

Tech M
Zen3 Infosolutions 


Washington, USA IT and software services solution with expertise in Software Product Engineering, DevOps testing, Machine learning and AI & Analytics 

AI enablement services to bolster its enterprise application practice

Cerium Systems Bangalore, 


Semiconductor design and testing, embedded software development and product engineering
Larsen & Toubro Technology
Orchestra Technology 

(US$25 million)

Texas, USA Telecom OEM – open network forums ONF and TIP across key elements of 5G like ORAN, private networks, narrow band IOT
CAPIOT California, USA Enterprise integration with valuable expertise in MuleSoft, Red Hat, and TIBCO (Cloud) 

Operations in USA, Australia, India and Singapore

Company Releases; NASSCOM Analysis

Additionally, deeper vertical focus is emerging towards Healthcare, Medical Devices and Telecom (5G).

The ever growing importance of cloud as an key business area is also reflected in the recent decision of IBM to spin off its $19 billion managed infrastructure services into a separate unit in order to enhance the business focus on cloud computing and AI which are creating immense growth opportunity in the new normal as businesses across industries are migrating to cloud and focusing on Automation for efficiency and cost saving.

The Road Ahead

In my view, this shopping spree by the Indian IT companies will continue.




The post Indian IT Services Reimaging Growth in the New Normal #3: Shopping Spree gathers momentum for Indian IT Services fueling expansion in the #newnormal appeared first on NASSCOM Community |The Official Community of Indian IT Industry.

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