About the Company
Hexaware Technologies is a global technology company that helps businesses become more digital and modern, with a special focus on artificial intelligence (AI). Think of them as technology experts who help other companies work smarter and better in today's digital world.
What makes them special is their strong position in various industries. For example, they work with many of the world's biggest and most successful companies - including 31 from the Fortune 500 list. To give you an idea of their reach:
● They help 11 of the biggest banks in America
● They work with 3 of the largest healthcare companies in the world
● They support 3 of the biggest manufacturing companies globally
● They assist 4 major retail companies
● They partner with 3 of North America's biggest airlines
One of their main strengths is their use of special technology tools they've created themselves. They have three main tools:
● RapidX™ - which helps companies transform their old systems into modern digital ones
● Tensai® - which uses AI to make work processes more automatic and efficient
● Amaze® - which helps companies move their systems to the cloud (think of this as moving their computer systems to the internet)
While many technology companies offer services in just one or two areas, Hexaware provides a complete package of services across many different industries. They're particularly good at using AI to solve business problems, which is becoming more and more important in today's world.
The company has offices and works with clients across three main regions - the Americas (like the United States and Canada), Europe, and Asia-Pacific (including India and Middle Eastern countries). This means they can help businesses no matter where they are in the world, while understanding the specific needs of each region.
Revenue from different business segments:
Hexaware Technologies demonstrates a well-diversified revenue portfolio across six key operating segments, with data showing consistent performance across all verticals for the financial year 2023 and the nine months ended September 30, 2024:
Financial Services emerged as the company's largest revenue contributor, accounting for 28.3% of total revenue as of September 2024, showing a slight increase from 27.1% in the previous comparable period.
Healthcare and Insurance represents the second-largest segment, contributing 21.2% to the total revenue as of September 2024.
Manufacturing and Consumer continues to be a significant revenue generator, contributing 17.0% to the total revenue as of September 2024. Though showing a slight decrease from 17.9% in the previous year, this segment has maintained a steady contribution above 17% over the recent periods.
Hi-Tech and Professional Services has shown growth in its contribution, reaching 16.9% of total revenue as of September 2024, up from 16.1% in the previous period. This upward trend indicates Hexaware's growing presence in the technology and professional services space.
The Banking segment and Travel and Transportation segment each contribute smaller but significant portions to the revenue, at 8.5% and 8.1% respectively as of September 2024. These segments provide additional diversification to Hexaware's revenue stream.
When examining the service delivery model, IT services dominate the revenue mix, contributing ₹74,446 million for the nine months ended September 2024, while Business Process Services (BPS) added ₹10,960 million. The company maintains a balanced approach between onshore (56.4%) and offshore (43.6%) service delivery, optimizing cost efficiency while maintaining service quality.
This diversified revenue structure, with strong presence across multiple sectors and a balanced delivery model, provides Hexaware with stability and resilience in its business operations. The company's ability to maintain consistent segment contributions while growing overall revenue (13.6% growth in the nine months ended September 2024) demonstrates its successful strategy in managing a diverse portfolio of services across different industry verticals.
Revenue from Exports:
Industry Context
The global technology services market is experiencing robust growth, driven by digital transformation initiatives across sectors. As per the October 2024 IMF outlook, global GDP is projected to grow at 3.2% for 2024-25, with technology spending showing particular resilience. The enterprise technology market is expected to reach $343.0 trillion by 2029E, with IT services growing at a CAGR of 7.2% during CY2024-29E.
Key highlights from market analysis indicate:
● India maintains its position as a preferred delivery location, commanding 55-65% of the $15-20 billion global capability center market
● Accelerated adoption of cloud, AI, and data solutions post-pandemic is reshaping service delivery models
● The outsourced IT services segment shows strong growth at ~48.8% of total technology spend, indicating increasing trust in external expertise
Financial Performance
Revenue from operations:
Revenue from operations has grown at a CAGR of 20.26% from FY 2021 to FY 2023.
EBITDA and EBITDA Margin:
Profit after Tax (PAT):
PAT has grown at a CAGR of 15.42% from FY 2021 to FY 2023.
Key Risks
● A significant portion of the revenue from operations is attributable to certain top customers, and often they are not their exclusive IT services provider. If they cannot maintain and expand their existing customer base, their business, financial condition and results of operations may be adversely affected.
● They are vulnerable to cyber-attacks, computer viruses, ransomware and electronic break-ins which could disrupt their operations and have a material adverse effect on their business, financial performance and results of operations.
Valuation and Peer Comparison
Use of IPO Proceeds
The company will not receive any proceeds from the Offer. All proceeds from the Offer will go to the Promoter Selling Shareholder, in proportion to the Equity Shares offered by them in the Offer for Sale.
IPO Details
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