Anil wonderful questions – infact, I attended the AGM in chennai and had the some concerns about this getting commoditized. To counter this, much like infosys, MPS is adopting a platform approach where they take on a customer’s entire process on their software and keep re-engineering their work processes to increase automation. So, it sort of becomes a platform led BPO operation which is very sticky and can deliver good returns – think eclerx.
if anyone, Nishith understands this game and I remain bullish on him delivering – he understands profitability and cash flows and is not running after building an empire and the impression I got of him is that he is a patient, shrewd guy who can wait for the right opportunities. I see an analogy with eclerx – lots of tuck in acquisitions each of which kicked in operating leverage 18-24 months post the acquisition – resulting in a 25 % compounder ahead.
Also, MPS could ultimately become an acquisition for a larger guy which nishith may be open to – given he understands the importance of growth.
I am invested in MPS and looking to add slowly – I see it as a modestly asymmetric bet – little downside and decent upside with optionality from acquisitions.
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