With growing global uncertainty over the Euro Zone crisis, businesses with focus on the region are experiencing a slowdown.
Mr Asvini Kumar, Chairman and MD, Thinksoft Global Services, talks about the evolving testing services market and the company's expansion plans.
Thinksoft Global Services specialises in software testing for the BFSI sector and is the only listed entity in this space. Currently, it has a market share of 12 per cent of the specialised testing market and plan to reach a level of 25 per cent in the next three years.
Do you plan to shift focus to other regions, considering that your business in Europe has declined?
Business in Europe shrank over the last year (from 52 per cent in fourth quarter ofFY11 to 39 per cent in Q4 of FY12). Nobody wants to take a risk and now there is even more uncertainty. Our growth will come from Asia and North America. The Asian region includes West Asia to Hong Kong. Australia is also a good region that we are looking at. In Africa there are only four or five companies with advanced banking. But, we have started visiting the country.
Thinksoft gets only eight per cent of its revenue from India. Do you plan to increase focus on the domestic front considering the global risks?
We want to keep the India business less than 10 per cent. The problem is that in India the rates are not good. So, we can't really run a profitable business here. At the same time, we would not like to be absent from India. This is mainly because the technology and the kind of exposure which we get here is quite top class. For example, stock exchanges here are more advanced than western countries. However, the problem of rates remains. Until we find a better strategy of getting for compensations in India, we won't want to expand the business beyond this.
What other inroads do you want to make to maximise your share in the India business?
We want only top 12 clients in India. We have 8 at the moment including RBI. We are working with the NSE but not the BSE. We have to work with one more large PSU, one large private sector bank and one multi-national bank. We are working towards it. In India, there is a need to get away from monthly billing to a fixed price offering system to ensure profitable business. The mobile banking market could be an interesting area to tap into.
Do you plan to acquire some companies to accelerate your growth?
We are actively looking at making some acquisitions and are very serious about it. We wanted to do it last year but we are continuing our efforts.
There will be very small acquisitions (in the range of $3-4 million). The company should have a specific technology which we will be able to use. The acquisitions will be outside India as innovations on this front are happening outside.
Any new clients that you are planning to add? What strategy works to increase your client base?
We want to work with people such as National Payments Corporation and Nabard.
By the end of this year, we should see some good news on this front. In the next quarter we are looking at adding four clients.
We are also trying to form partnerships with vendors who are already doing implementation consulting but are not doing testing. The key into the US market is through partnerships.