Indian IT firm Mphasis counts on banks to power revenue growth, CEO says

BENGALURU, Nov 6 (Reuters) – Blackstone-backed Indian IT services company Mphasis said it expects its core finance segment to grow sales in the six months to the end of March, with revenues forecast to grow at more than double the industry pace.

Revenue growth from India’s $283 billion IT sector has declined in the past two years as customers tightened budgets amid macroeconomic uncertainty and headwinds on US tariffs and immigration policy. This is now starting to change, especially in financial services, where companies are warming to AI-led projects to increase efficiency and reduce costs.

Underlining that efficiency has become a dominant theme in customer conversations, CEO Nitin Rakesh said, “Enterprise America expects to grow without increasing headcount.”

Mphasis, which generates half of its revenue from the banking and financial services segment and more than 80% from customers in the Americas, said the increase in spending in the segment has become a “more formal trend”, indicating a shift from unregulated investments to structured and strategic technology spending.

The deals achieved by the company in the first half of the fiscal year ending March 31 surpassed the number of the entire previous fiscal year. It reported $1.29 billion in new deals in the first half and predicts annual revenue growth will be more than double the industry average, which analysts at Jefferies estimate is over 6%.

“We have had four (US) interest rate cuts in the last twelve months. This also brings with it some further easing of the credit situation and consumer confidence,” the CEO said. (Reporting by Haripriya Suresh; Editing by Dhanya Skariachan and Mrigank Dhaniwala)