How do you look back at the last seven years of Gecis
We started in a small way, and at that time, we did not expect that we would grow so big or successful. Today, we are the biggest in this segment in the country, with worldwide operations. When we started the operations, there were many concerns, like infrastructure and people-related issues. We also knew that we did not want to be just a call-centre operation. There were also issues related to policy and the regulatory environment. We had a lot of discussions with the government. Another area where we spent a lot of time was in training people. One of the main reasons why we started operations was that it was a way to bring about huge cost savings for all our companies in the group worldwide.
Then, why have you cut down your financial stake in the company now. Is the cost advantage no longer valid
No, that is not the case. The fact is that this business is not really a core business for General Electric (GE). It is still a cost-saving area. In fact, as we grew over the years, and I saw the industry maturing, I was convinced that business process outsourcing (BPO) would be a big business in the country. In fact, I remember saying that this business had the potential to be even bigger than the software business. Now that we have diluted our stake, we will be able to gain new businesses outside the GE fold and actually have an opportunity to further grow. In fact, I was one of the key persons in GE who was actually pushing for dilution of equity and for the deal to happen.
This is a dynamic business and third-party contracts worldwide will grow. I believe that captive businesses in BPO operations will slow down. But, at the same time, this is a great business to be in. So, diluting our stake made greater sense at this point of time.
Today, almost 95% of the business, I believe, is captive business. How will this change over the years
We are the biggest in this business in the country by a factor of two to three times. Our current revenues are about $370 million. Spectramind should be about $100 million. I reckon that over the next three years, the share of GE business will come down to about 30-40%. We are looking for long-term growth.
Over the last few years, we have already moved up the value chain. Today, the commodity-type of business of our operations will be just about 25%. What I call the high-end business would be about 15% and the top segment about 30 to 40%. We are also already operating in a range of segments, including accounting and finance. What we will do now is to add to that portfolio.
What are your plans for the company
We want to have a presence in segments, like engineering, supply chain and also add to the areas of verticals that we operate in. We have a global manpower base: the biggest in India with about 13,000 employees, 1,300 in China, 550 in Hungary and 2,000 in Czechoslovakia. We will now be increasing the product and geographic segments. We also want to have a greater presence in Eastern Europe and China.
What was the genesis of the current deal Can you throw some light on the process of negotiations and the culmination of the deal
It was roughly about two years back that we initially said we would take a relook at our business. Serious negotiations of the process started in January this year. But I was clear that we would go about it very selectively. So we did not talk to a lot of people. Instead, we identified a few companies and financial advisors in India and abroad. I was convinced that we should have a different approach.
Are you happy with the valuation and the money that you have got
In any negotiation, there will be some give and take. Finally, we arrived at a mid-point.
What about your own role You looked after both GE Capitals finance side and the BPO operations. Will that continue
No, I will now look after Gecis only. There is so much to be done. There are others who, even now, had been operationally in charge of the other side of the finance side of the business. They used to have a dual reporting structure. But now, I will not be involved in the management of that side of the business.
In the last few months, there have been a number of mergers and acquisitions in the BPO business in the country. Whats the future
The process of consolidation of the business will continue. I also believe that captive businesses will not be as popular as in the past.