Tech Mahindra’s revenue from 5G solutions quintupled in one year

Tech Mahindra is betting on 5G solutions – its next growth chart. The IT services major’s revenue from 5G solutions grew from $125 million in FY21 to more than $600 million in FY22, a nearly five-fold jump. It has invested more than $300 million in developing its 5G capabilities over the past two years.

The company secured two major deals in the 5G space last year. Tech Mahindra’s offerings in this sector cater to the telecom and enterprise segments, but most of its business comes from its suite of 5G for Enterprise solutions.

Talk to Activity area, Manish Vyas, President, Communications, Media and Entertainment Business, and CEO, Network Services, Tech Mahindra, said, “For us, 5G is not a one-trick pony. It’s three things. Telcos where we integrate the network, platforms and systems and also manage the 5G infrastructure. Second, for the ecosystem, there are hundreds of companies innovating right now, some making devices, others working on 5G orchestration software. We do a lot of development, engineering and integration for them.

He added: “Third, 5G for business. This is the next growth charter for us. The world still hasn’t seen enough 5G growth for businesses – that will start to change soon. We are already doing several pilots on it around the world. From a revenue perspective, that’s going to be the next big thing, but that revenue may not come from 5G for telecommunications, but rather from 5G for enterprise.

So far, demand has been dominated by the US and European markets, as well as parts of Asia-Pacific. This year, as the business evolves, 5G will become an age-old theme across the globe for Tech Mahindra.

Tech Mahindra has also invested in establishing R&D centers and making acquisitions to build capabilities in the 5G space. So far, it has set up more than 11 5G R&D centers around the world and plans to add several more this year.

“Many innovations need to happen every day and we work with our customers. We have already set up 11 laboratories around the world. Over the past two years, our investments in 5G and 5G, including acquisitions, our total investment would be over $300 million. I think now the model we are in is that we will continue to invest, but our previous investments will start to pay off from this year,” Vyas said.

Growth catalysts

Vyas noted several use cases the company has developed or is currently working on. 5G technology is being used in manufacturing, healthcare technology, and oil and gas, to name a few.

“We currently work across several industry verticals. There are use cases in manufacturing in terms of smart factories, equipment management on the shop floor, after-sales service management for the same companies. In the field of health technologies, we are talking with very remarkable electronics and medical technology companies, to create and integrate our IG solutions inside the creation of the next generation of diagnostic solutions. And also very basic use cases around telemedicine, remote health care. In the oil and gas sector, we talk about asset management, repair work, troubleshooting processes that we solve for oil rigs, etc. Inventory management,” he said.

“Overall, we’ve had the best activity ever for the CME vertical over the past 12 months. In terms of growth rate, we grew by 17.2%. In terms of volumes, we experienced the fastest growth. We are the fastest growing company in the telecommunications sector among our domestic and international peers,” he added separately.

Published on

June 12, 2022

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