Mindtree seeing strong momentum, client satisfaction at all-time high: Debashis Chatterjee, MD & CEO

Debashis Chatterjee, Managing Director & Chief Executive Officer, Mindtree, talks about Covid disruptions, the company's business prospects, deal pipeline and hiring plans. Edited excerpts:

You are once again seeing positive revenue growth. What is giving you the confidence of double digit growth in the next fiscal?
Revenue growth has been pretty robust based on a strong order book and a strong pipeline. We never had this kind of strong pipeline before.

For two successive quarters we have seen 5%-plus sequential growth. Given the pipeline and the order book which has grown 12% year over year, we feel very confident of our growth momentum going forward.

What are the verticals and geographies that are showing increased momentum?
We have been very focused in terms of transformational deals. It aligns with our overall service client strategy in customer data, cloud and modernisation.

As for deal flow, most of the tractions we have seen are from comms, media, technology and retail consumer goods. So RCM and CMT verticals have given us a very strong momentum.

Also, the investments that we have been making in Europe have paid off, adding to our momentum. Last quarter, we saw around 8% sequential growth in the UK, Ireland and Europe.

As we expand in Europe, we are also focused on doing multi-year annuity deals.

In view of the second wave, what kind of client feedback you are seeing in terms of their budgets for IT?
We have all learnt to work through Covid. Last year, there was a lot of support that we got from our clients. Overall, our client satisfaction has been at an all-time high.

Covid has opened up a lot of avenues for us — transformational deals in customer services, data and cloud. These have accelerated in our clients' portfolios.

I think we have built the resilience in the system. We cannot predict how many waves will be there, but we can certainly be confident that we can deal with it them all.

Higher attrition would probably mean more hiring, more increments. Do you think that some costs may return then?
EBITDA cannot be just a one-quarter story. We have focused on improving our margins quarter over quarter. That is exactly what we have done in the last six quarters.

We have put a very strong process in place. We have very good control on operational excellence and that is why we are very confident that we can certainly sustain the 20% plus EBITDA.

We want to have profitable growth. Given the current momentum that we have, we are very confident that we should be able to do double digit growth in the FY22 and keeping the EBITDA also in line with 20% plus.

Yes, some costs will come back at some point. But I do not think all the costs are going to come back at the same time. We have to wait and watch.

Having said that, we are observing it very closely. I think attrition has been well within control. Sometimes you do see a spike, but attrition has actually come down as we speak. It is 12.1% for last 12 months — a very good figure from our perspective.

So overall, if you ask me, we are very bullish in terms of our growth story having clocked two consecutive quarters of 5% plus growth. We are also very confident that we will do double digit growth with 20% plus EBITDA.

Share with us your hiring plans, plans for increments. What if you see any supply side issues?
In terms of hiring, we have done a net addition of 1,600 MindTree minds. I can only say that we have a very robust hiring plan for the coming quarters. The net hires will only keep on increasing. It will be a good combination of laterals and minds from the campus. We have also done wage revision as of 1st January across the board.

Hiring will continue. It will be much stronger than last year. With a robust pipeline, we are very confident of meeting our hiring goals.