We witnessed handsome growth from some of our new clients and large deals announced in earlier quarters.
By Srinath Srinivasan
Q3FY21 has been a growth quarter for IT services industry. L&T Infotech, which posted strong results, continues to double down on developing new capabilities and attracting large deals from the market. CEO and MD Sanjay Jalona shares what is working for the company with Srinath Srinivasan of FE. Excerpts:
Q3FY21 has been a growth quarter for IT services industry. What were some factors that were in your favour during the quarter?
We performed extremely well in this quarter because all four engines of our growth strategy are humming. These are key accounts, invest accounts, new accounts and large deals. We witnessed handsome growth from some of our new clients and large deals announced in earlier quarters. We also won two large deals in the quarter —Injazat with a TCV of $204 million over 6 years, and a 5-year deal with a net-new TCV of $74 m from a global Fortune 500 energy company.
What are some changes in the way LTI is hiring after the advent of remote working? What are some skills you’re looking for in talent? What percentage of your workforce will return to offices in Q4?
We have made a complete switch to virtual onboarding. We leverage AI-based tools to match skills with job requirements. We have also designed enhanced talent management system that uses intelligent algorithms to retain and expand our talent pool. Our virtual hackathons and job fairs help us scout skilled resources for cloud, data, analytics, AI, ML positions. Recently, we launched LTI Shoshin School, an innovative learning platform that offers comprehensive learning content, standardised learning experience and enables culture of continuous learning to upskill/re-skill our workforce. Majority of our workforce will continue to work remotely during fourth quarter. Future of work will be a hybrid model. So, we will continue to work from office as well as it is one of our key attributes for culture and collaboration. But it will be spread across 40 delivery centers (currently about 16) in 20 cities (currently about 10 cities), many of them in Tier 2 cities, as well.
There have been large deal wins among the large cap players which has accelerated their growth. Has it opened up new avenues in the market for mid-caps to venture into?
As the average deal size gets smaller, these opportunities are available to everyone with strong capabilities. Today, our size gives us the ability to participate in most IT RFPs. Overall, our large deal pipeline is healthy and with our growing size and deep capabilities, we are getting invited to more of them. Our expertise and execution approach have mattered the most in our performance so far. What I find most exciting are the proactive conversations that we are having with our customers, many of which generate large deal opportunities.
You have highlighted license sale agreement of AI products on your Mosaic platform during Q3. Are the exponential technologies paving way for mini-agencies to be formed within LTI specialising in niche capabilities?
We feel cloud and data products are two key areas that present huge opportunities for industry players. Accordingly, we have created two separate units to cater to these opportunities and these units will be the critical growth engines for us in the next 3 to 5 years. We also have an open innovation ecosystem in place which includes that connects 6,000+ start-ups, educational institutions, and 700,000+ experts that help in converging ideas into disruptive business offerings.
Where do you see headwinds coming from in Q4? What is your outlook on market recovery across geographies and business segment?
Not so much a headwind, but I would say that it is important for tech companies to continuously focus on staying relevant to customers in a fast-changing world. That is where our thinking of Shoshin or beginner’s mind helps us. We remain optimistic about the rollout of vaccinations. In the meanwhile, we will continue adopting new operating models, building direct-to-consumer channels, and workplace modernisation.