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Digital will be the growth engine for Mindtree in the next five years

Global strategy: Natarajan says Mindtree is looking at acquisitions in consumer -facing segments in North America and Europe.

Digital will be the growth engine for Mindtree in the next five years, says its chief executive officer Krishnakumar Natarajan.

Citing currency volatility as a dampener, Natarajan says the company's first quarter revenue will be impacted by about 0.5%. The company is looking at acquisitions in consumer-facing segments in North America and Europe, he says in an interview.

Edited excerpts:

What is your outlook for the company in FY16?

As we start the year, we see the demand momentum still being quite positive. One way of looking at demand is from a customer viewpoint. They have an investment budget for running their businesses.

Clearly, customers are looking for greater cost efficiencies on that front. They want more productivity.

So, we don't anticipate a big growth in revenue numbers in running the business because the customer's need is more efficiency. But primarily, customers are not demanding efficiency so that they can save; rather, they are seeking efficiency to invest those savings in discretionary spends, particularly in areas like digital transformation. So, clearly, we see a strong uptake in digital and any discretionary spend which clients do is a positive for Mindtree, because that is an area of strength for us. It is also the reason why we believe that a guidance of 10-12% will be met. But what could be a bit of a dampener is the way in which currencies could really play out because clearly, currencies have been quite volatile. My presumption is that even in quarter one, it could have maybe half a per cent impact on revenues.

In terms of acquisitions, what are the geographies that you are looking at and what are the verticals that you are looking at to go ahead with acquiring companies?

Clearly, we believe discretionary spends are really happening in industry segments which are facing consumers.

In our case, it is retail consumer products, the banking, financial services and insurance (BFSI) segment and travel and hospitality.

So, we will be looking for consumer-facing segments and companies which have delivered and have a set of capabilities and customers. It is largely going to be in North America and Europe.