Having made acquisitions in the travel and transport, banking, financial services and insurance (BFSI) verticals in the last two years, NIIT Technologies is planning to strengthen its position in these segments through the inorganic route.
Speaking to Express, NIIT Tech CEO Arvind Thakur said the company is looking to build strong specialisation in the segments of travel and transport and BFSI. “(The acquisitions if any) will definitely be in the travel and transport space. Any assets that we acquire, will be in these segments,” he said.
NIIT Tech has significant presence in three segments - BFSI, transport and travel and manufacturing and distribution.
While 42% of NIIT Tech’s revenue comes from the transport and travel segment, 33% is contributed by BFSI. The balance is distributed between manufacturing and government segments.
Going forward, Thakur said NIIT Tech has enough cash on the books to make an acquisition in case an inorganic opportunity comes up. “The balance sheet is strong. As far as acquisitions are concerned, there is enough liquidity available to support that,” he said.
In September this year, NIIT Tech had acquired the Manila development centre of US-based Sabre Holdings for an undisclosed amount.
The buyout not only gave a boost to its business process outsourcing business but also helped it in expanding its operations in the Asia Pacific region. The centre, which has a capacity of 200 seats, will enable NIIT Tech to serve Sabre and other clients. Another of NIIT Tech’s notable buyouts in the travel and transport segment has been that of Spain’s Proyecta Sistemas de Informacion S.A. The acquisition of the Madrid-based software services company provided NIIT Tech a platform to enhance its footprint in Europe and strengthen its travel and financial services offering.
On the strategy to cope with the impact of the slowdown and especially the Eurozone crisis on the BFSI segment, Thakur added that NIIT Tech is now focussing on getting contracts from tier-II financial services organisations.
“The BFSI is definitely somewhat soft. There has been once crisis after another. What we are seeing is that the impact (of global economic crisis) is more severe on the large financial institutions,” he said.