To offset the high attrition rate and execute about $2-billion order pipeline, global private equity major Carlyle Group-controlled Hexaware Technologies is adding 10,000 more to its 25,000-strong headcount this year, a senior company official has said.
Last October, the Carlyle Group offered a reported $3 billion to Baring Private Equity Asia for the city-based software firm founded by technology veteran Atul K Nishar in 1990.
PTI was the first to report in late August 2021 that Carlyle, the Washington-based private equity, alternative asset management and financial services giant set to pip bulge bracket rivals such as Bain Capital, KKR & Co and the Paris-based outsourcer Teleperformance, was the winner with a $3-billion bid for the company.None of the three parties has yet officially announced the deal completion.
Nishar, who was founder and chairman of Hexaware Technologies, had in 2013 sold majority stake to Baring PE Asia for Rs 1,687 crore, with an open offer for another 26 per cent totalling the deal at Rs 2,745 crore. Later, he fully exited the company but remained chairman till the deal with Carlyle was completed. By November that year, Baring had picked up 100 per cent in the company.
Hexaware had hired 10,000 people both from campuses and laterals in 2021 — taking its headcount to 25,000 from 15,000 in 2020.
The company is set to hire a similar number of freshers and lateral this year, taking its overall staff strength to 35,000 in 2022, its Chief Executive R Srikrishna told PTI on Tuesday.
The demand environment is high and healthy but good talent is always in short supply. While a good number of them are going into the start-ups that are paying high paychecks, many with experience are also getting into the product side of technology, he added.
“Our hiring from the campuses will go up further, as we are expecting accelerated growth this year. Campus and lateral hiring will be 10,000 this year as well,” Srikrishna said.
Srikrishna added that the large hiring is needed for one to offset the high attrition, which rose to 21.2 per cent probably the highest in the industry — in 2021 from 13-14 per cent in the previous year; secondly, to execute the massive $1.9-billion of order pipeline that the company has.
Hexaware, which earns a little over 70 per cent of its $1-billion revenue (2021), has 75 per cent of its people sitting in India, and has 100 per cent locals manning its offices in Argentina, Mexico, Warsaw in Poland, Amsterdam, Russia and the Philippines, who together account for three per cent of its 25,000 headcount now.
Sounding bullish about 2022, he expects to close this year with over 20 per cent topline (revenue) growth and a high-teen uptick in net income, almost similar to 2021 performance.
Describing 2021 as an outstanding year, Srikrishna said their topline grew over 20 per cent driven by 385 new client additions, which was the highest-ever, led by healthcare, digital and consumer facing companies.
Barring travel, which used to contribute over 10 per cent of its revenue, all other verticals have done well in the year, he said.
Srikrishna added that the revenue share of travel fell to seven per cent in the year gone by. “The revenue/sector-wise client addition was secular, with banking, healthcare, manufacturing, insurance growing the fastest.”
On India revenue, he said it is only about 2-3 per cent and is comfortable with that level but in terms of staffing, 75 per cent is here.
“The US remains our largest market both in terms of billion and as well as profit, which print in at about 70 per cent,” Srikrishna said.
With 37 offices in over 30 countries and over 25,000 employees, Hexaware’s revenue grew 6.5 per cent in 2020 to $845 million, while operating profit jumped 24.4 per cent to $152 million.Revenue grew over 22 per cent to cross the $1-billion mark in 2021, from which it earned around 15 per cent in net income, according to reports.
