The outperformers 2020

What’s happening at Coforge is more than just a name change

CEO Sudhir Singh believes his new team and an aggressive incentive structure could soon take the company to the billion-dollar mark 

What’s in a name? asked the Bard, but then it is not very often that successful companies change their name, especially in the midst of a once-in-a-generation pandemic that has flattened growth across economies and geographies. But, that’s exactly what the Noida-based software services company, NIIT Technologies, did this August by changing its name to Coforge, for “working together”. The name change comes more than a year later when the erstwhile promoters, NIIT, handed over the reins of the company to Baring Private Equity in April 2019. This is Baring’s second acquisition in the IT space, as it already owns 62.7% in Hexaware Technologies.

NIIT Tech wasn’t exactly an exciting mid-tier IT company but that changed nearly three years back when Sudhir Singh, a Genpact veteran, took charge in 2017. He sharpened the focus on insurance, BFS, travel and healthcare, revamped the leadership and operating structure and, more importantly, implemented an incentive structure that ensured that rainmakers got paid at a faster pace. “We looked for leaders who were comfortable with scale, knew how to build scale and were hungry for growth,” says Singh. More importantly, instead of CEOs sitting out of India, NIIT Tech moved closer to its clients.

The change has worked wonders with revenue (Rs.29.91 billion to Rs.41.83 billion) and profit (Rs.2.80 billion to Rs.4.44 billion) growing at a healthy pace over FY18-20. Manik Taneja, analyst at Emkay Global Financial Services, says, “The senior leadership deserves credit for the superior growth metrics in recent years that changed the company from a growth laggard to a leader on growth.” However, following the pandemic, NIIT Tech given its significant exposure to the travel and transportation vertical, 19% in Q1FY21 and 27% in Q4FY20, saw revenue decline sharply. Within the travel vertical, airline revenue contracted 62% quarter-on-quarter in dollar terms and accounted for 5.5%

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