Synopsis
Coforge CEO Sudhir Singh asserts that demand for technology services is evolving, not declining, driven by new value pools. He emphasizes that firms proactively engineering business outcomes, particularly through AI-led modernization and governance, will experience sustained growth. Singh dismisses threats from AI firms entering the services space, viewing them as specialists within a larger, robust market.“There is a great runway for firms that can build upon the new demand value pools that have emerged. There is very limited runway for firms that continue to use labour as a default for solutioning and offering services,” Singh told ET in a post-earnings interaction.
“From our vantage point, firms that are leading with proactive solutions and trying to engineer business outcomes will keep compounding and growing,” he said.
While the opportunity for services in the near-term is in modernisation using AI, in the medium-term, it will be for managing and governing models and agents working together, he added.
Singh dismissed any market share threat to IT companies from AI firms like Anthropic and OpenAI entering the tech services space. “We do not really see this as very different from what used to happen with platform or SaaS players earlier. Every one of them used to have specialist professional services arms,” he said.
“No enterprise is likely to tie itself to one LLM provider. So, for a foundational model player to build a consulting layer makes sense from their perspective. They will be specialist high-end players in the broader ecosystem, but the tech services market is large enough for many players to operate,” he said.
The comments come at a time when information technology companies are dealing with slower decision-making by clients, geopolitical tensions and questions over how AI will reshape the services industry.
Coforge sees opportunities in helping enterprises build data architectures and pipelines aligned to AI interventions, with work around orchestration frameworks, workflow design and agent lifecycle management.
The Noida-headquartered company this week reported a 136% increase in net profit and 30% growth in revenue for the fourth quarter, boosted by AI-led efficiencies.
Much of this is stemming from the company’s strategy to proactively grab deals, instead of going through formal request-for-proposal processes where pricing pressure is high and margins are smaller, the CEO said.
“The reason our large deal metrics have continued to rise is that we have a specialist on-site team whose job is to study clients, go through investor calls, go through filings and create solutions that lead with business outcomes instead of technology,” Singh said. “For example, if a client is a specialty insurer, we walk in with a solution that reduces the quote-to-bind process time. It does not lead with technology, and it is not always aimed only at the CIO.”
Out of the 21 large deals signed by Coforge in FY26, 20 were sourced proactively rather than through competitive bidding processes, Singh said, adding that the company expects large deal wins to increase further in FY27 despite concerns across the industry over slower deal ramp-ups.
On acquisitions, Singh said Coforge would continue to take a contrarian approach, highlighting its buyouts of Cigniti and Encora.
“We also take a different approach to integration. In most cases, we do not retain the leader of the acquired business with long earn-outs. We put our own leaders in charge from day one because they are already involved in due diligence and accountable for delivery,” he said.
While Singh ruled out investments in AI startups as a revenue strategy, he said the company’s focus would remain on building industry-specific solutions using internal expertise in sectors such as specialty insurance.
