For Mahindra Satyam the last two quarters have been encouraging. During the period, the IT services company renewed contracts with existing key customers and also won new business in the BFSI, manufacturing and travel verticals. Vijay Rangineni, CEO, Mahindra Satyam BPO, tells FE?s Debojyoti Ghosh about the health of the BPO business and plans to widen its global footprint through acquisitions and partnerships.

It was said earlier that Mahindra Satyam BPO is exploring acquisition possibilities. Can you update us on the developments?

Yes, Mahindra Satyam BPO is exploring opportunities for acquisitions in areas such as procurement, BFSI, and accounting. This is for two reasons ? seeing increasing demand from prospects and customers for these services and the vast revenue potential these areas offer. We are also exploring opportunities for acquisitions and partnerships in order to grow our delivery footprint. We have already a couple of such partnerships in place in Latin America and South Africa.

What is the current position of the BPO business?

We have renewed our contracts with all our key customers for a period of 2-5 years, based on our consistent delivery. Our customer satisfaction scores stand at 86.3% as against the global benchmark of 83.8%, despite the multiple challenges we faced in 2009. In terms of new business over the last 6-9 months, we have won significant deals and multiple projects from new customers. We are in varied stages of discussions with several corporates across geographies. Due to the synergistic working with Tech Mahindra BPO, we are now able to offer a much wider range of service offerings to prospects. They have significant strengths in telecom, while we are strong in manufacturing, pharma, and travel and transportation. From a bottomline perspective, we continue to adhere to the highest levels of financial discipline, while continuing to invest in building capabilities, technology, and human resources.

Do you expect business to grow from the current levels? Which are the verticals that?s seeing good traction?

We are very optimistic about growth of business in the remaining part of this fiscal, as well as in 2010-11. Our view has been corroborated by the contract renewals that we have had with our key customers and the significant new businesses we have won. Looking ahead, we have adopted a strategy of focusing on four key verticals from a BPO perspective ? telecom, BFSI, manufacturing and pharma. These are either verticals where we are currently strong, or the ones that happen to be large outsourcers. A couple of other verticals where we foresee significant traction are travel and transportation and citizen services.

How strong is your current client base? Which are your major markets?

We have over 25 clients, with a majority being large Fortune 500 majors. What this means for us is that not just our current engagements with these organisations are substantial, the scope of further mining these accounts to strengthen our relationship is huge. In terms of geographic break-up, the bulk of our revenues come from the US and UK. However, with some of our clients, especially in the pharma and travel and transportation verticals, we are seeing revenues coming in from different geographies.

Are you exploring any new geographies?

We see significant opportunities stemming from APAC, India and Europe. We have dedicated feet-on-street in all these geographies to address the growing market. Importantly, this also means that we need to adapt our selling strategy as well. While some countries value cost arbitrage as an end-benefit, other countries are appreciative of the long-term value that BPO service providers bring to the table. As such, growing in diverse geographies does pose challenges, but more often than not, these challenges are interesting and exciting, which makes the journey more fulfilling for us as well.

How is business from the domestic BPO market?

Since our inception, we have been a BPO focused on international business. However, over the last 2-3 years, the domestic BPO scene has seen a boom, and is currently growing faster than BPO exports. Keeping in mind this significant opportunity, we assigned dedicated feet-on-street for the Indian market, and have won new deals in the last 12-18 months. In the next 3-6 months, a substantial part of our revenues will stem from domestic BPO.