Analysts anticipate Mindtree Ltd.'s recent acquisition of NxT Digital from parent L&T Group will help it expand its Internet of Things (IoT) capabilities. The Internet of Things is one of six white space opportunities recognized by the company for medium-term growth.

In the coming years, the Bengaluru-based IT services company is likely to focus on healthcare, security, and enterprise applications, as well as expand into Australia, the Middle East, and Japan.

NxT provides Mindtree with platform-based data and analytics to help it reinvent business processes in areas like worker's safety, asset tracking and equipment maintenance.

For fiscal year 2022 (FY22), the company has identified six growth levers:


•Wallet share expansion


•Industry partnerships and consulting


•Increasing investments in Europe


•Marketing and thought leadership for digital


•Addressing white space opportunities


•Leveraging partnerships with hyperscalers

Last year, the company announced its 4x4x4 strategy, focusing on four main verticals, service lines, and geographies.

“Mindtree sees enormous revenue potential in its cloud business ($1.5 for every $1 spent by clients with hyperscalers) and has assembled a team to capitalize on growth prospects with each hyperscaler,” said Dipesh Mehta, senior research analyst, brokerage, Emkay Global Financial Services Ltd.

“On the back of solid deal wins ($1.4 billion in FY21, up 12.3 percent year over year), a healthy deal pipeline, account mining, and multi-year annuity deals, Mindtree remains optimistic of generating double-digit growth in FY22”, added the senior research analyst.

The company is extending its footprint in Europe, notably in the Nordics, as consumers in the region become more favorable to outsourcing. In the Middle East, it will also extend its banking, financial services, and insurance verticals, as well as its travel and hospitality verticals. Mindtree plans to expand its operations in Japan by leveraging L&T Group's presence, and it is also beefing up its sales force in Australia.

Healthcare is being developed as a separate sector within Mindtree, with an emphasis on digital transformation for providers and medical device manufacturers. From the current quarter, it will report revenue for this vertical as a separate vertical.

Mindtree has established an IT security operations section in Bengaluru to meet the growing need for security and enterprise applications, as well as expanding its SAP ERP implementation capabilities.

“Through IoT capabilities garnered through this acquisition, Mindtree intends to rethink the end-to-end process from operational layer to customer experience layer. While the business will not participate in areas such as device and sensor installation, it sees a potential to grow the Internet of Things beyond manufacturing into logistics, transportation, retail, and healthcare,” said Aniket Pande, head analyst-IT and Telecom, Prabhudas Lilladher.