Column Infy goes shopping

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: Europe-bound acquisitions. And to gain a larger footprint beyond the English-speaking market, Indian IT companies will have to focus on developing their non-English language capabilities. In fact, many Indian IT majors are increasingly attempting to move up the value chain. Taking advantage of the global slowdown there would be many Indian IT companies who would increasingly take the M&A route not only to position themselves as value-added consulting companies, but also to add geographical reach and front ends. Also Indian IT companies would have to gradually work towards reducing their over-dependence on the US banking and financial services industry, which is passing through a volatile phase.

Apart from the European market, Indian IT companies would have to aggressively look at the Asia Pacific markets, before other low-cost locations such as Mexico, China and Philippines gear up to reap the benefits of the global delivery model.

Finally, for the Infosys-Axon deal what is now needed is a growth trajectory. Infosys does not have a long track record of successfully integrating large companies. The company could face a challenge in retaining the high end consulting talent of Axon, given that in some earlier acquisitions by other Indian IT companies the retention record has had not been very impressive. For Infosys, this would indeed be a big challenge, given that 90% of its workforce is Indian.