MUMBAI: The Information Technology (IT) industry is expected to grow at a bleak 7-8 per cent this financial year, but players like LTI (earlier L&T Infotech) believe export revenues have the potential to grow over 10 per cent.
“If your (India’s) revenue in the global pie is growing compared to everyone else, how can you not be happy? This is a sign of a maturing industry, where things are being done differently,” Sanjay Jalona, managing director and chief executive officer, LTI told Express.
The $150-billion IT industry clocked a pale 7.6 per cent growth last year and the trade body expects flat growth even during the current fiscal. Of late, there have been several reports of job cuts both by Indian firms and multinational companies as the volumes in the business and balance sheets seem shrinking.
According to Jalona, the sector witnessed healthy double digit growth in the past, but as it matures, the pace of growth is accordingly adjusting.
LTI, which garners just about 6 per cent of its total business from India and the remaining 94 per cent from overseas business, grew at about 10 per cent last financial year.
“Deal sizes are definitely going down. As technology evolves, team sizes are changing, there’s increased competition, country barriers have gone, and newer players are able to compete efficiently. The kind of spend that’s happening is very different,” Jalona explained.
Stating that the comparison of growth witnessed in the past and the unfounded theory that Indian companies are lagging behind implementation of emerging technologies, he said, if Indian firms weren’t innovating, even the 7-10 per cent growth was unlikely to happen.
“I don’t think Indian IT firms lag behind in automation. Innovation is happening is in pockets for customers,” he said adding that the company, for instance, partnered with over 100 startups simply because there’s plenty of innovation happening, “I’ve never done this in my entire life. Things change for the better,” he said.
According to Jalona, every industry matures over time and as it becomes mainstream, there’s always some amount of growth tapering. What’s happening within the IT sector is that the pace of innovation has rapidly evolved in the past five to seven years and it has significantly brought down the technology spend.