Recovering from slow growth of 5% last year, EXL Service ? one of the country?s largest BPOs ? is expecting 30% growth for the year ending December 2010. The company?s insurance, travel and transformational business will lead the growth.
Inspite of the sensitive conditions in the European market, EXL Service has targeted its revenues to reach 10% from the region, except for the UK, in the next two years as against 3% at present.
Because of the loss of its biggest client, Aviva, EXL Service witnessed slow growth last year. Aviva had sold its captive BPO in India to WNS. ?The previous year was a bit of a slowdown after losing our largest customer, Aviva. Now, we are back on track to grow at 28 to 30% per annum,? said Rohit Kapoor, CEO and president, EXL Service.
The insurance vertical is growing very rapidly and clients are looking at outsourcing within the industry, he added. ?This quarter we signed up two major clients in the UK and US. One is a five-year deal and the other is a three-year,? said Kapoor. The insurance vertical at present contributes 54% revenue to the company, followed by 10% in travel and 22% in ?transformational? business.
EXL noted the potential in verticals like travel and transformation. It has recently started doing work in transformation and change management for the banks and financial institutions. The BPO completed its $30 million acquisition of American Express back office operations in February this year to boost its travel operations.
While the US clients continue to dominate 75% of the revenue for EXL, it is focusing to expand its footprint in European market. Though Europe gives the company 25% of its revenue, the major 22% comes from the UK. Large insurance carriers, including British Gas, being EXl?s primary clients, European crisis is not a major concern for the company.
On the acquisition front, where EXL has been less aggressive compared to competitors, Kapoor said, ? The best way to grow business is by acquiring capability and to create differentiation in terms of catering to our customers. But, we are not afraid of making a large bid if it is the right place. We have $100 million cash and access to equity markets and debt markets as well.?
Analysing the the brighter side, after posting a net income of $4.9 million for the quarter ended June 30, 2010, the company plans to give 8 to 10% average salary hike this year against 5-6% given last year.