Hewlett-Packard spinoff likely to hit Mphasis outsourcing biz

Venkatesh Ganesh Adith Charlie Bangalore/Mumbai | Updated on March 12, 2018


HP’s decision to split its business could further impact Mphasis outsourcing business and lock horns with the technology giant in some business areas.

On Monday, HP said that it will split its business into two businesses. The first would be HP Enterprise, which will sell servers, networking, storage equipment and the second is HP Inc, which will sell PCs and printers. Mphasis is a part of HP and gets around 36 per cent of its revenues at the end of first quarter of 2015 fiscal, which could further go down in this fiscal.

Analysts believe that this decision would further impact Mphasis business that is coming from HP.

According to Sanchit Vir Gogia, Chief Analyst & Chief Executive Officer of Greyhound Research, with this move, one expects HP to capitalise on its own services portfolio and compete head on with Mphasis in the marketplace.

Mphasis officials point out that in such a scenario, the company is preparing to look at revenues coming from non-HP business.

“While it is too early to take a concrete decision, we are deliberating this internally,” said a source in Mphasis who is not authorised to speak to the press. When contacted, an Mphasis spokesperson did not comment.

Mphasis has been consciously changing its business model and trying to rev up its growth engines by trying to move away from business that it gets from HP to that of competing on its own in by making acquisitions such as Digital Risk into areas such as mortgage-related software. It also launched a new brand identity with a focus on bagging next generation software services contracts in areas such as digital technologies and wearable computing.

“The company’s effort to reposition itself clearly is a way to delink itself from its parent in due course of time,” according to AK Prabhakar, IT analyst.

Published on October 06, 2014

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