1. What is the vision for new 3i Infotech and what should your employees at 3i Infotech and other key stakeholders look forward to? And what are the financials we are looking at post this carve out of our business?

3i has been in business for now more than 27 years, post April 1st is a new 3i because we have carved out our product division and that has helped us to be debt free and new 3i which is now predominantly services, is about a new road map for itself. The 3i stands for Innovate, Incubate, and Invent so with this background we thought we should have a vision which would probably set the course for us and that is to be a trusted global one-stop digital transformation partner who delivers business excellence and exceptional outcomes to our customers in this new digital decade. We want to be a billion-dollar organization committed towards our customers people and stakeholders with continuous capabilities to orchestrate incubate innovate and invent digital transformation services harnessing the power of 5g power innovation. I think that's the core if you look at it, we want to leverage this decade which is going to be driven by 5g and potentially post 2025 maybe 6g. So, we want to be a pioneer in this 5g powered innovation that's the key theme for this new 3i and in our statement of intent we have released where we are looking at being a billion-dollar company and to grow organically by 2030 and that's a big challenge we have stated for ourselves and we're rallying the whole organization in this dream of a billion dollar by 2030.

2.The pandemic has brought about a systemic shift in the way of business. The whole explosion of digital has been further accelerated due to the pandemic and this is out there for everyone to see. How has the company adapted itself to deal with this change and what can you're over a thousand clients right worldwide not only India, expect from 3i Infotech? What are some of the most blatant vulnerabilities in the IT ecosystem that you believe the COVID-19 outbreak has now brought in there?

We used to talk about pre-Covid or post-Covid, but we are in a Covid era, we are learning as a human race to coexist with the Covid. So, Covid fundamentally has accelerated the global landscape of business itself. Some key challenges globally which customers are facing, and I want to touch upon how 3i want to probably capitalize on these challenges and see how we could be a differentiator in the marketplace. Second thing if you look at it global economy is not just shrinking because of Covid, there are a lot of other factors which are impacting and influencing it, it accelerated digitization and automation of many jobs and the worry is this could potentially lead to a huge socio-economic issue across the world which I think collectively all of us have a responsibility to manage it where organizations have to really manage between this capitalist deliverables. Since transformation cycles are getting shortened, innovation cycles are getting shortened, and clients are looking for pre-orchestrated pre- configured solutions and services and the new buzzword is anything as a service so anything as a service is going to disrupt the classic managed services business for any IT services company so 3i also is now on a road map to build this business model around anything as a service. The other single biggest opportunity which has emerged in the covid era is emergence of gig economy and a virtual remote workforce in a post covid era is a reality. Now the challenge which comes with that is securing the organization at the edge of the network, it's a clear challenge and it's an opportunity for 3i. Data privacy, data security and end-to-end cyber security is a huge challenge with the explosion of data which is happening today.
On one side we have data explosion there is also explosion of devices which are latching on to the networks so this rapid growth of intelligent devices accessing a network also brings about its own weaknesses at the edge of the network. So global risk and compliance in a borderless world is also a key challenge today especially when we are shifting the global supply chain is getting disrupted in a more polarized world today and all these are also clearly driving changes and 3i wants to leverage some of these opportunities. Say how do I protect my organization's core systems against organized cyber ransom attack spy number one like it's all over the place you see the headlines today how I protect my organization against data privacy and data protection and provide a SASE which is the secure access secure entry to my virtual workforce who are also BYOD bring your own device so how do I protect them, protect myself. Third is how do we ensure our new global third-party partners are compliant against various GRC or EST standards how do I protect my customers interacting with our network at the edge to be secure a lot of b2c companies are going through these issues today, what if somebody's device gets hacked, who's accountable, is the company providing the service or there is a mediation gateway which provides it, so we are into that world where we need to ultimately to protect these devices at the edge. COVID-19 has truly globalized and made it borderless, a totally digital and a virtual world—we are now trying to figure out how to co-exist with this pandemic. So, looking at a CXO's key challenges, the top of the mind would be, how do I protect my organization's core systems against organized or random cyber-attack? The second is how do I protect my organization against data privacy, data protection, and provide SASE (secure access and secure entry) to my virtual workforce. The other issue, new global third- party partners are being onboarded. I do not know how good these partners are, so the need for global risk and compliance or the more modern way to call it, the ESG, the environment, sustainability and governance index has become a kind of a norm today globally. From a 3i perspective, we would like to use these challenges as an opportunity. And can we provide a 3i cloud, which is edge ready, edge computing services, which has got SASE products embedded in it, can we provide cybersecurity or service powered by AI and finally global risk and compliance as a service to our customers.

3.If you have touched on 5g and edge computing whether you’re talking RPI, RPA, AI or ML, Block-chain, Cloud, SASE or some of the technology that are redefining the tech landscape globally and which you mentioned with varying maturity levels across industries and geographies, digital transformation is a reality and enterprises need to leverage it to stay competitive so that’s a reality, what will be 3i-Infotech’s play in this space and what will be the key areas that the company will focus on? 5g already seems to be a clutter area and you have larger players already participating in that fire, but then how do we differentiate?

We have always been known as a BFSI shop, 3i was born out of a bank and have deep domain expertise in BFSI of course in government and retail and bits of healthcare so from an industry perspective I look at this as an industry vertical and also horizontally as 5g power services industry vertical we want to now build a business around telecom media entertainment because we want to work with telcos with telco being a customer that is one strategy where we want to work with them to help them in their SD-WAN services, helping them probably optimize their OSS BSS all the typical engineering optimization from our convergence of network operations and security operations. Second is we also want to work with the telcos to help them differentiate themselves from other industries because they have a huge opportunity to cannibalize other industries that telco could be potentially agnostic to an industry they could offer health care services insurance services you could have because they have a huge enterprise space so we want to work with the telcos to work with their enterprise customers their SMB customers and offer integrated managed services which could be a digital business process services or it could be automated integrated IT support services, It could also be cognitive computing it could be legal risk and management so forth. To expand on that there’s a huge opportunity for blockchain powered content aggregation, content lifecycle management it’s a big opportunity today in media and we want to invest in that in terms of how do we build zero trust systems end-to-end from an overall content lifecycle perspective because this is going to become a very important focus area for the organization horizontally.
And we want to get the cloud edge ready we want to move everything to the edge so we want to invest in cognitive computing services in simple English AIML data sciences data analytics powered services and we want to differentiate away from this normal run-of-the-mill data science analytics I think there’s plenty of stuff but we want toget into really move up the value curve in terms of go beyond predictive prescriptive analytics to more a recommendation or next best action, recommendation engines is what we want to focus on and we want to get cognitive analytics to the edge. We got the cloud moved to a micro data centre which is closer to the edge, so latency is reduced ability to move decision making or decision support to the edge becomes faster. This will also lead to disruption in our own service lines whether it is our traditional IMS business or application we want to disrupt our own businesses so just like automation as a service or no code or it could be digital IMS for micro data centres so I think the whole focus would be how to integrate all these and offer a seamless offering to our customers which are more focused to our customers problem statements their business KPIs and their business outcomes and focused on extremely high on industry orientation. Finally, some of the next generation industries which we also want to invest and focus is of course on green tech and Agri- tech are two important industries where we want to focus and this lends itself for the 5g powered services and we already have some pilots happening across the world we are also investing in centre of innovations to fuel all this to very clearly look at two strategies one is a centre of innovation and a centre of excellence. Centre of innovations is more like an invent and incubate lab where you’re inventing and incubating next generation technologies. We want to work with a lot of start-ups, work with them, make them enterprise grade, give them global access to customers, we might end up buying some of them as well, as we see there’s more mutual value for both of us that’s on the COIs and with the COIs, we want to build around blockchain industrial IoT cognitive computing and edge computing services these are four COIs of building. India is a very big part of the strategy, but we’re also focusing on Malaysia where we want to focus on industrial IoT, Switzerland we want to focus on blockchain and Canada we want to focus on 5G powered services.
So we’re also balancing our geography focus on investments on centre of innovation on where we can get the right talent in a borderless world today and India of course would be the COE where we’ll be able to incubate these COIs make them commercial grade and then probably build scalable set of excellences in India where we’ll be able to generate and multiply the revenues across these lines. That is a space for everybody. So, we want
That is a space for everybody. So, we want to be very clear what space we want to play. We don’t want to go compete on a tier-1 or a multinational company. So, we want to pick up our areas of focus. So that’s why we want to stay focused even in 5g powered services. SASE is going to be a focus area for us in terms of edge security. We already released our product themselves of NURE edge, which is a SASE product built on Oracle frameworks, which is 5g ready. We can deploy today in 4g at any country whereby although we can do that. We want to just pick our battles. We want to focus on GRC global risk and compliance. We also want to focus on cognitive computing where we want to focus on edge analytics. Because we want to play in the area where we could probably contribute to the data life cycle at edge. And even with the telcos, we want to stay focused with MVNOs because globally is a huge market. We can work with a lot of OEMs; we don’t have to work directly with telcos. They need providers like us to work around them because the hardware is getting kind of disrupted, all of them have disruptions happening to them because it’s going to be a serverless world. We have a roadmap for sure. If you look at a strategy, we have a quarter-on-quarter strategy in terms of what we want to kind of focus and then more, but we don’t have the kind of invested multiple stuff. So now if you ask me, what is my focus for the next two quarters, we are focusing on some of the edge cloud that’s launched. And we are now building to the next level on that. So, for example, we already launched our SASE. We want to go into implementation stage. We are working with Oracle to kind of work with all these clouds, build all the kind of transformation methodology. And then we are now maybe in Q4, we’ll start building edge analytics on top of it and pick up one industry. So that’s the kind of a roadmap.

4.New 3i Infotech has shown a lot of interest and focus on the start-up ecosystem, what kind of investment, support and offering can this ecosystem expect from 3i Infotech? What vertical we are currently present in and what is our future strategy in terms of getting into new lines of businesses?

As a new 3i we are reinventing ourselves we want to be frugal and clear about our investment strategies. So, we have a limited budget. We want to work with a lot of venture capitalists and there are already VC firms who have invested in a lot of start-ups. Let’s say we’re working with a VC firm in Switzerland who’s very focused on blockchain so now it fits into our strategy we will work with the VC firm so they are invested in the start-ups we are not going to invest in them, we will provide investments in global access to our customers building practices, building centre of excellences providing enterprise grade infrastructure for these start-ups and maybe individually or collectively we’ll stitch them together and offer services to our customers in the bargain it’s mutual value creation for 3i and for the start-ups of this VC firm. Of course, ultimately, we might decide to pick up stakes if it has created enough value, so these are some of the models we want to experiment. We will build satellite systems, other applications, upstream downstream systems because we have more knowledge about the real industry problem, the customer problem what is the problem we are stopping so that’s a model where we are focusing. One more thing we are also doing is we are building some products we sold off all our products that does not mean that we are not going to develop products so part of the invent strategy we want to invest and build products and we will be investing in building we are building a product in GRC space where we are partnering with companies who have a great idea and we provide the product development capability, so we both work together create a new product and we are joined owners of IP. So, we’re also looking and experimenting this idea of inviting entrepreneurs.
One is 3i was born out of a bank, so we are strong in the BFSI vertical, and we want to kind of strengthen it further. So BFSI will continue to be our main state where we will build on various innovations. We want to invest in new verticals like telecom media and entertainment, especially the 5g services, because we see the telecom industry is becoming the convergence opportunity.
It could be healthcare, insurance, it could be any industry, which the telcos could probably be. In fact, we are building a new telecom media entertainment, vertical, which is super focused on 5g powered services. We want to see how we’ll be able to manage all these devices at the edge using 5g. So, our focus will automatically shift to manufacturing industry because it lends itself to that. And it’s a great opportunity for us to implement some of these edge ready services which we want to offer manufacturing to Agri-Tech and Green-Tech. In Agri-Tech and Green-Tech, we want to focus on emerging manufacturing. Telecom media entertainment will be immediate next focus area.

5.In this remote work setup what are some of the initiatives or measures 3i infotech has taken to drive better productivity and overall well-being of its employee because people do get burnt out because of the stress and this entire work from home remote working is something which is very new to a lot of us so what is 3i doing around it so if you can just throw some lines? In terms of hiring on the senior leadership side and sales side, are we done with that hiring or we still have room for more senior leaders to join-in? And how do we incentivize these people to join 3i and to take what is in for them, what are the ESOPS policies and how do we incentivize them to stick along? How about a developer kind of a person, how difficult it is to hire a technical guy, a supply side? How about the old team, have we lost substantial talent from the earlier team at 3i? How about the transition period?

There are two parts one is people are going to be core to our strategy, right from retraining them, re-skilling them, repurposing them in line with the strategy. That’s what we’re doing across people we are investing, over investing in learning and development of our employees because we firmly believe that the skill change, we want to see how we can reskill our 4500 workforces. The skill mix must change so one of the important areas we are investing even in this pandemic is that how do we constantly help our employees to upskill themselves. We are also helping with the entire culture change program from top down as I’m speaking to you we’ve already done a program for our top 100 leaders in the company and we’re also trying to see how we can cascade it down these are second initiatives the third initiative we are doing the people side is we want to translate the goals which is at my level at an organization level to the last person in the company so we are into an exercise of translating these goals into really smart goals. KPIs and metrics till the last man. People can’t have greys this point of time. It’s so people should know exactly this is, what I’m expecting to deliver. So, we want to build this transparent open culture and remove subjectivity out of it keep it very objective you also want to drive the culture of the how part of it. We need to drive a workforce who’s highly efficient and eliminate the waste, so we are strongly pushing this culture to stop work by nine hours and ten hours in a day to help employees manage a work life balance.
The second is also we are also pushing our employees to say how do you invest your Saturdays maybe it could be fun based learning use it for your own learning, so we are also trying to devise a program and upskill yourself learn something new get certified put up your hand. We brought on board, chief growth officer sax Krishna. So, we have brought a lot of senior leaders from the industry, veterans or joined us, at the leadership level. And now we are strengthening the, the next level, the mid management. So, to your point, in terms of incentivizing them, everybody’s an entrepreneur. So, whether it’s a compensation plan in terms of that fixed or variable, it’s all aligned to a growth. So, it’s a kind of a self-motivating plan. And we also have a good ESOPs policy, and which has been given to everybody. And we’re bound over the common goal, to grow the company and it will be rewarding for everyone.
In IT resources, getting people is the biggest challenge. So, we are not different. So, we are also facing our challenges. So, Priya, our CMO is helping us rebrand ourselves and communicate this new 3i to attract talent. We are integrating that model because there are three tracks which we want to do. Second thing we want to have some targeted hiring, it costs more money but there’s no choice because obviously the ones who are already trained by the tier 1s, is a very clear strategy we are going after. So, we don’t want to waste our time training them, or we wait for the prior ones to train them, and we’ll hire them. We are also very particular about a cultural fit. So, we are very clear because we kind of laid out our new culture of 3i as well. And we are now slowly trying to figure out how we can get employees who are culture fit. It’s okay. We will invest in them.

6.Given our history of problems and everything and given who are our peers and how those peers have changed go on ahead of us. So just wanted to understand what is our right to win? When we go to the clients, what is this proposition we are bringing in, so that clients get existing as well as new, will give us business. How many of our clients are still there? Let’s say 10 years back or five years back. How many of them are still with us? And given the fact that they stuck to us with us for a longer period, is there any scope for further mining those clients do to grow them? What will be our client concentration currently? And what is the kind of repeat business visibility we have on the current revenue side?

From this new 3i perspective, we are hardly six months old, we have no baggage, but we know we inherent the legacy and the good name. So that’s the plus point. What we’re positioning ourselves as is can we be a one-stop shop, innovator, orchestrator. For example, I’ll just expand on the Oracle partnership. Oracle is just not a cloud partnership. It’s a convergence of infrastructure as a service, platform as a service, software as a service.
And ultimately you can offer business processes. So, where we are saying, can we cannibalize our competition by becoming the partner who can optimize, total cost of operations for our customers across various lines of business. So that’s what we want to do. Say for example, now, even in cloud, if I look at it have a CSP who just sells licenses, a cloud service provider, there’s a managed services provider who manages the ongoing operations of cloud. There’s somebody else who does transformation in terms of integrating next generation applications into the cloud. Now, if I look at three, I am saying, I will do all the three for you and give you an optimized cost, over a period. So that’s how we want to position ourselves. We differentiate it is where our incubate strategy comes in where most of our technology, we are building on startups in the sense startups are at early stage. We gain access in terms of trying to provide a central of excellence around them. So, we get access to some of these technologies. We then build our products and services around them, and we go to market. So that’s kind of our secret sauce that I’ll save 20% of the cost for my customer and my margin goes up from 2X.
So, this will be an extremely margin focused for us and deserves the top line, reduces the cost of operations for our customers. The good thing about 3i today. The 3I legacy is there that I don’t have to sell three I brand name in the market. There are still customers or been with us and in our ups and downs. So, the positive is we have a long list of customers. Maybe our revenue share has gone down over a period. Now the opportunity for us is to mine these accounts. So, we have a long list of customers and it’s for us to now go and mine them with these new services, new proposition and we are now kind of not doing that. So that is an opportunity which we have, as Account mining strategy. And in fact, we have our top 25 accounts by which we want to see, can we get these top 25 accounts to be a minimum million-dollar accounts? So that’s one strategy and a top 10 accounts can be a $5 million strategy in the next year. If you look at geography split. Also, we are only strong in US, middle east, India, and Asia. We used to have huge customers in UK, Europe, Africa, Australia, but all that has gone off, now these are opportunities for us to win back as well. We are hoping to launch it on Oracle powered cloud in Europe for GDPR. And we offer digital Knowledge crossing as a service. So, we are now going back to all our old customers and saying, “We’re back with this new product and new services.”
It’s an opportunity, as well as the challenge, because since the product business was sometimes a mainstream in some of these accounts and services was a secondary, or we also have our own independent services customers that are two parts to it. So, to your point, we don’t have huge concentration of revenues within the single line. We want to see if we can add new revenue step and expand the top 25, with the new lines open.
There’s still IMS and AAA, which is our application automation and analytics. So, these are our mainstays. We’re also investing big time into the BPO business because business process services were never a big play for 3i, why we are doing it is because we want to be a differentiator digital business process service. We want to disrupt the classic BPS. So, we are trying to do exactly opposite of normal BPO provider. We want to be digital first cloud first BPS provider. And because this offers a huge top line, and we can disrupt the traditional business models.
So, this will be an extremely margin focused for us and deserves the top line, reduces the cost of operations for our customers. The good thing about 3i today. The 3I legacy is there that I don’t have to sell three I brand name in the market. There are still customers or been with us and in our ups and downs. So, the positive is we have a long list of customers. Maybe our revenue share has gone down over a period. Now the opportunity for us is to mine these accounts. So, we have a long list of customers and it’s for us to now go and mine them with these new services, new proposition and we are now kind of not doing that. So that is an opportunity which we have, as Account mining strategy. And in fact, we have our top 25 accounts by which we want to see, can we get these top 25 accounts to be a minimum million-dollar accounts? So that’s one strategy and a top 10 accounts can be a $5 million strategy in the next year. If you look at geography split. Also, we are only strong in US, middle east, India, and Asia. We used to have huge customers in UK, Europe, Africa, Australia, but all that has gone off, now these are opportunities for us to win back as well. We are hoping to launch it on Oracle powered cloud in Europe for GDPR. And we offer digital Knowledge crossing as a service. So, we are now going back to all our old customers and saying, “We’re back with this new product and new services.”\
It’s an opportunity, as well as the challenge, because since the product business was sometimes a mainstream in some of these accounts and services was a secondary, or we also have our own independent services customers that are two parts to it. So, to your point, we don’t have huge concentration of revenues within the single line. We want to see if we can add new revenue step and expand the top 25, with the new lines open.
There’s still IMS and AAA, which is our application automation and analytics. So, these are our mainstays. We’re also investing big time into the BPO business because business process services were never a big play for 3i, why we are doing it is because we want to be a differentiator digital business process service. We want to disrupt the classic BPS. So, we are trying to do exactly opposite of normal BPO provider. We want to be digital first cloud first BPS provider. And because this offers a huge top line, and we can disrupt the traditional business models.

7.What are your expansion plans and key growth markets in the coming few years? What are 3i Infotech’s India specific expansion plans and how critical is India to the company’s overall growth strategy? You also highlighted some of the market forces and the macroeconomic factors that are going to really revolutionize the IT ecosystem as we know it. But what are some best practices that we as a country might be able to adopt and embrace from our global counterparts abroad?

Where we are now strong is North American market is a strong geography for us and we want to keep investing more in North America, we already have a presence in Canada but we want to expand into Canada as two parts one is Canada is also going to become a near shore delivery hub for USA because now more companies want it near shore, they want to look at offshore only when there’s a true requirement for certain talent. 50% of our revenues come from there so that will continue to be our top geography. The second important geography for us today is the middle-east market that we expand rapidly.India today as a borderless workforce for middle east it’s a huge opportunity this is going to probably drive job opportunities in India because a lot of companies in middle east are just talking about can you move my entire department to India, to save cost so they’re also sensitive saying that okay I want to save the jobs of my employee but by moving to India can I reduce my cost to 50% so all employees or Indians could move to India and still retain the jobs and maybe work at Indian salaries. Second biggest trend in middle-east is also the opportunity for leveraging Eastern Europe from a centre of excellence or a centre of innovation perspective because we have some extremely good product development capabilities especially in the 5g space in terms of Poland and Ukraine we want to leverage these countries to service global markets. UK, Europe, and Africa, we were present, but we lost ground there over a period of years so this is a win-back territory for us to get back and expand our MSAs and in Africa our focus is predominantly into Nigeria, Kenya, and South Africa. India is a big geography for us because it gives us almost 30% of our revenues today and part of the large 10-year plan today we spoke about becoming a billion dollar or 7500Cr organic growth and we want to keep India as a separate business geography.
So we are planning for around 2500 crores in the next nine years from just India alone. If I go to the APAC territory over a period of time 3i lost ground we are now focused immediately in Thailand Malaysia and Singapore, something we’ll be looking at how we can work togethercreate a COI in Malaysia which could be servicing Malaysia to Malaysia business and also it could potentially be a near show for the Asian territory because everything is going to be digital powered be passed right so it becomes language agnostic I can process Vietnamese in Malaysia because my computer vision reads Vietnamese and I don’t need real Vietnamese skill so I just need human beings to do the downstream. I’m just giving an example similarly Malaysia will also fuel the phase two would be we want to work on Japanese. Japan as a geography and Australia as a geography so broadly I think that’s our geography focus so this year if you ask me you want to stay focused on where we are so this is this year is a year of building our foundation, strengthening our foundation so stay focused on North America, Middle east, India, Asian and build the foundation for the balanced territories to win back our customers and prepare for the assault into Japan and Australia is what we’ll focus. Human-humanoid coexistence is the reality we can’t run away from it. As human beings, we have to start learning how to work with this. The positive I see is that big workforce becomes a reality in this country. Some massive workforce we could probably leverage and a huge suburban and rural workforce is something which we could leverage for the digital business process services, this could really offer a huge job opportunity to people in my view. So, this is one very clear opportunity.
The second one I see is the digital IT infrastructure management. And one of the big ideas we are looking at for India is, can we create a cloud for the SME segment? The massive, the small and medium industries, is about 50% of the GDP. If you look at it, can we build a cloud for them? Not just a cloud, but cloud with all platform applications ready to use. The other one, we want to also focus on telecom media and entertainment industry, because the 5g is going to be the backbone of a lot of transformation. And so that’s an opportunity. And data, there’s going to be an explosion of data because it’s already happening. Data is going to be new oil. This is going to be a huge opportunity in the big data analytics. And I spoke about a micro data centre because they are extremely important to get the edge further into Indian intellect.
Edge networks, micro data centres to Indian intellect it’s going to be a game changer. And we want to kind of stay ahead of the curve. In new industries, we want to stay focused on two things in India. One is again, the government’s vision of building a green energy target of almost 450 megawatts by 2030.
We want to see how to be a green tech service provider, so that’s an investment we want for the new industry vertical. And agri-tech because I think these two are going to kind of change the way India is kind of exploring, is the way I look at it.
There’s a lot of good work done on the ease of doing business we need to make it easier, because that’s going to really fuel foreign direct investments into the country and fuel our start-ups. So, we should have more start-ups, more inventors in India. They should not run away to Singapore or another country. That’s a first step because they are going to create jobs and they are going to build a lot of stuff for this country.
As a country, we lack in centres of innovation– because we are not inventing enough, we are more like followers. So fundamentally the biggest challenge in front of us is that we must quickly reskill our workforce. What we we’re finding out is, that we have a lot of average and slightly above average people, we don’t have the real quality of above average people and that’s a huge scramble for the talent. The other challenge I foresee is how do we keep on next generation workforce? Right-skilled and future ready. Indians are high on IQ, but our problem is we are sometimes comfortable and we tend to be generalists. We have to start getting specialists, so that shift has to happen in our minds, in our DNAs.

8.If taken from a two-year, three-year perspective other than giving us a nine-year horizon. What is our next ultimate target for 3i? Where do we see 3i in terms of margin profile, in terms of return ratios? If you can give us an idea that out of this 100cr EBITDA, what can be the repeat business or sustainable EBITDA, which will be there in the coming year? Also, to look at it from a two to three year perspective, BFSI today being a large portion, what could we see the revenue mix meaning two years from now? Would it be 50-20-20.Would it be 50-50 as far as telecom and entertainment media are concerned?

The short-term goal would be to target a 100 crore EBITDA in three years. It's all disruption of top line happening in terms of these type of cannibalization of revenues happening cannibalization of processes happening. It's all focused on bottom line, so the bottom line targets the way we are running in three years, we want to hit a 100 crore EBITDA. So obviously we have services business, and the services business was never a mainstream for 3i in the last decade. So, it was a product company, which also did services.
We're just five, six months old. We need kind of rebuild this foundation, but that's the first part. When I say foundation, the processes, the policies build it for scale, but if I don't build it for scale, we cannot accelerate. So, these are parallel tracks. And as we are kind of aspiring all our strategies, our core focuses on rebuilding a foundation.
One of the biggest changes we are also doing is we are now trying to reward our people for a more long-term contracts in terms of total contract value, which is like, at least each contract has minimum two years of annuity revenue. So, the whole focus is trying to see how we can get more annuity revenue where we have more, forecastable business. At least in three years from now, we want to be in a scenario where 80% of our business is protected always. And even if the cycles are getting less, as at least we should have a minimum two years confirmed contracts, which will ensure us that we are safeguarding our revenues.
The two large verticals are BFSI and government right now. So, it's almost like 45-20 and the rest at 25 we have a long tail across multiple industries. We have in retail, in healthcare, but we're not really expanded there. Broadly between the government and BFSI will be around 65% today. But the shift will happen in the quality of business also. DME will become at least 20% more in this mix. Because Gov-tech, we want to stay focused, globally, every government is spending.
We want to be a force reckoned in the government space and globally also so broadly, it will be around 40, 20, 20, between these three, we have a site DME and government, and the balance 20 could be in next generation emerging tech.

9.What is our go to market strategy? Is it aligned more with respect to verticals? The goals are aligned with respect to geography. Can you talk more about your sales strategy? Which are three or four key verticals where most of the disruption opportunities are available and that a 100cr EBITDA composition, if we want to give us any breakup. What is the broader strategy on that aspect you've planned? Are these 25-30 accounts enough to reach that?

The sales strategy is a geography led strategy. So, we have the growth strategy. The growth is broken down into geographies, and we have India region, which is one geography because India itself is a very large geography. Then we have our primary region, which is, US and middle east. And emerging regions, which has Asia and other territories. So, broken down into three territories, three regions, broad regions within that we have horizontal practices. So, the practices are pulling a box with the regional sales leader. So, practices, we have cloud first as a practice, we have AAA, which is automation, analytics application analytics and automation is another practice. We have digital b-pass and k-pas, which is digital BPS or BPO is another practice. Finally, we have the next gen services, 5g powered services, which is the fourth horizontal, all of them work in a box with a sales leader. Plus, we also have industry a specialization within the practices. So, within cloud first, we have BFSI. So that's the hierarchy we have in terms of the geography, the practice, and within the practice, we have industrial specialization.
We want to kind of change the revenue mix, our GMs are less. So, we need to optimize that. And the entire new growth, we want to focus on the new lines of businesses. So, our main focus would be on 3-4 areas. One is the cloud first vertical because the cloud first vertical is a clear Arrowhead. We are looking at a gross margin of 40 - 50. And even if we disrupt and do that, we will be able to hit easily around 20% EBITDA. So, 25% will come from our cloud first or digital IMS. The cloud first and digital IMS will merge. And other revenues like testing revenues, application, testing, performance, testing, AAA (application analytics and auto) will add on.
So that will, again, lead to another easily, 15%, contribution. Automation, for example, is another huge disruption happening because traditional application development is disrupted. It's all moving towards low-code no- code. So, these will contribute almost 40%, 100Cr easily. The balance 55 break it will come from two parts. We want to offer digital BPS and KPS powered by our cloud. We are launching these lines will give us steady annuity business, because it's all pay as you go model, and one year business contracts and margins are high because it's standardized, there's no customization, it's more or less 90% standardized for a particular industry which we see will also contribute almost like 20% of the balance revenue.

10.A common misconception in the market is that migrating one's existing systems on the cloud requires a complete infrastructural overhaul. How do you respond to that? How do alleviate the minds of clients who perhaps approach you with this exact concern? Help me understand customer sentiment. As you have these cloud conversations, what do you believe customers today care most about? Is it truly digital transformation? Is it Seamless 24x7 operations? Is it cost optimization? And is there an approach for striking the right balance between the three?

This a myth, I've been trying to bust for the last 10 years, when we started selling cloud 10 years ago to where we are today, I think we all come a long way as an industry. There's no question about debating today in 2021 that should I migrate the cloud or not? It is just probably we'll have to figure out, is your cloud infrastructure edge ready? That's the question we need to be asking because we need to be now ready for- can I provide those at the edge of the network? Is my cloud elastic enough, is what we need to ask?
So, in line with this, we are also kind of trying to build our solutions and we want to kind of create a 3i cloud, which is edge ready and the objective of this would be to reduce latency and increase security and scalability at edge. In simple English, latency- all of us are logging into it, we are all on the go. It takes time for your action to go to the cloud and come back, but just imagine we are edge, we have micro data centres where you process very quickly. You don't have to go all the way to the cloud- that's edge ready cloud.
Now, how do we balance all this? Every department is vying for this and especially in this world where every industry is going through stress. All of us are facing revenue cannibalization. So, in this era that classic managed services, IT managed services in my mind already disrupted and customers and clients want very clear outcome-based partnership business models.
So, more and more engagement models are now getting linked to customer's business KPIs, and that's the reality. And for us, if you ask me as a service provider, such as ourselves also we could provide integrated end- to-end service. So that's what the customer wants, they want a one stop shop. So does it have digital, technology, cognitive AI, operations delivery, all put together, I just give you one check- that's it.
I don't have to go to four partners. Next is the 24x7 support. We need to have the uniform platforms, which are standardized; the processes are uniform so that anybody can work seamlessly and support our customers. And all of them must be pre-configured for the industry we are servicing and configured for the customer's KPI because it's extremely important. The third part I feel is going to be a necessity. It will have impacts on jobs. And there's a report which says that we are going to lose almost 3 million jobs in 2022.
We must figure out how to generate new jobs for people. Because humanoids and humans are going to work together and reduce costs for businesses. That's the positive side for businesses. The negative side is that humanoids are going to take away a lot of rule-based jobs.

11.On the government business. If you can give us some colour what sort of opportunity, you're seeing in the government business and how easy of that business? Don't you think the receivables are sluggish because other companies generally try to shy away from this segment?

So, today, the post COVID environment, every company will be just examining this: should I be in the government? All of us have to kind of participate in the government. The only thing is that we must select our battles and select our type of deals we want to do. So, we are very careful in terms of type of contracts we want to participate, and we don't want to get into any deal which is top line focused, we are going to be a very margin focused company. And second thing, if in scenarios like that, we'll go with the consortium and we want to stay focused on our, our capabilities. We want to pick our battles, and this is not just India. We are also starting to work with other governments as well, across the world, even in Asia or Eastern Europe, everywhere across the world, governments are very keen to kind of leverage these technologies. So, we want to stay focused on our capabilities only.
It's a fact. If you look at it from a global trend perspective, post pandemic, most of the industries are almost in ventilator today. Governments are starting to spend. So whether you like it or not, you need to have a government strategy for the next two, three years. But the fact is we have to be very selective about the deals we want. It's very, very important. We want to be very selective and to reduce our risks, we want to play to our strengths and bring in partners co-prime partners where we can be prime, and they could be co-prime. And we see a huge uptake in the cloud business, in governments, across the world. And most of them also want to have edge ready cloud and it fits in well there. For example, video surveillance as a service. So we are now working with some governments. So we want to stay focused on some areas where we will have an advantage where we can advise governments and help them create prototypes and pilots.

12.Any tentative timeline for the listing of the new 3i?

As far as the scheme of reduction is concerned, we have already fixed the record date that 31st of August for determining, the people who will be eligible. The reduction will be happening in the ratio of 1:10. If there are any fractional shares that are generated because of this reduction, fractional shares will be consolidated, and they have been allotted to the trustee. We have hired the external agency. They will sell it in open market and the proceeds will be remitted to the shareholders in proportion to the fractions. But we have made the relisting application, once the application is processed and everything is done, we will get the approval of those stock exchanges. Relisting application at least to be concluded by next week or by the end of next week, then after that the corporate actions will happen and then the relisting happens. So, I honestly cannot give you a timeline because the way stock exchanges work and we are dealing with two stock exchanges, BSE and NSE both for each one has their own way of looking at. We'll try to get it by end of this month. At the most it'll spill over to one or two weeks in October.

13.For organizations of all sizes and all sectors, managing the technology footprint, is a time intensive exercise and it's also a capital-intensive exercise. There's no denying that in many ways it can detract from the day to day functioning of the business. So how do you at 3i Infotech attempt to essentially address that reality?

The disruption cycles are all sharpening. We don't have the runway, which we used to have before. There is a need for service providers like us to be more industry oriented and be oriented towards the customer's business problem. From a 3i perspective, the new vision which we are setting for ourselves is to see how we can address it, is to be a trusted global one-stop digital transformation partner and delivering business excellence with exceptional outcomes to our customers in this new digital decade. Our customers need a one-stop solution, which is aligned to their business outcomes, where we can help them drive business excellence. So that's extremely critical. The second part is, how can we be a value driven organization with our billion-dollar dream which we have, committed towards customer, people and stakeholders with continuous orchestration, incubation, innovation, and invention of digital transformation services harnessing the power of 5g technology.We don't have all the time in the world to kind of figure out the services solution, so I got a cloud it's configured for edge, I've got an AltiRay platform it could be like products like Maggi, Crux, Momenta. You got CLM customer life cycle management analytics, business process service in a box. So as a customer, you don't have to bother, you're only worried about the end outcome. How do I manage my customer experience management? You just give me an Opex and it's all there in a box. I'm a firm believer that whatever we preach, we should first practice, so what we are starting to do, we are experimenting on ourselves as we rebuild as an organization. If we are happy, we will be able to offer this to customers commercially as a decision support, as a service to other CXOs.

14. If we were to speak to a member of your team, very curious to understand how they might describe your management style, your leadership philosophy, or perhaps a mantra that you've lived your life by?

The culture is the core for any organization, because if you don't get a culture right, we will not be able to achieve our goals. So, one of the important things which we are doing as a company is for this new 3i is we are chalking out on new culture. And in fact, we are going through a culture change program itself for this new 3i and the core underlying foundation is entrepreneurship. Can we be entrepreneurs without own corporate life? We are now building the company where every employee is an entrepreneur. So that sets the tone for it. Then, if I expand on some of the values we've put together, one is we want to start with trust and integrity. You want to be a brand which is known for trust and integrity. The second is speed and agility. So, we want to be the fastest and we can provide the fastest differentiators for our customers. And two core pillars I would see is, Customer centricity, customers, and employee centricity, both are very important for us. Finally, we need to be a learning organization. Only a learning organization can adapt to changes quickly. These are the values and cultures we want to live by at new 3i.

15.Since the cross margins are quite low, does this dependent on the nature of business, what we are doing and the nature of business we will be doing in coming period, or utilization is impacting that gross margin?

We want to get a break this into three parts, the run, grow and build. The run is our current business which we have inherited. And that is a gross margin.
And 3i has not grown the last five years from an aggressive top line perspective or a revenue perspective. So now post carve out, it also puts pressure on the current organization, basically because your highly profitable product businesses has gone away. And we have to fix this as we are flying the plane. So one of the immediate stuff is we are strengthening our resource management groups and the current existing businesses to how to drive that efficiency, utilization, and all that standard stuff, which we have been doing in this IT industry for almost two decades and to get the margin in our hands in our current business. That's very important for us. In fact, Harish, the chief performance and compliance officer, he drives business excellence and margin enhancements and also balance with global risk and compliance. So this is a new function we have started to just stay focused on margin enhancement of the current business.
The second one is the growth part of it, which probably 3I lacked all this way. So we are stepping up the very aggressive growth engine in terms of aggressive growth engine where our focus is going to be on high margin business, transformation business led by digital transformation. So we don't want to do any of our classic businesses however tempting it might be. We are taking an informed call on it. So any new business we want to add, we'll bring into the new revenue mix. So over a period of time, maybe this year we'll have the order book now, but I'm for sure the next year when we start realizing these revenues, the revenue mix is the margin mix will change dramatically.
Second one is to focus on aggressive growth but very selective in terms of type of business we want to bring into the company. So that's margin driven rather than top-line driven.
And the third thing is of course the build part of it, we are investing in it very quickly so that it also brings us differentiator. It also slowly starts building out valuation for us because these are critical IP, which we want to build and is also monetizing for us.

16.Can you figure out how much is the utilization right now and how much you can take it from the current level. And the second question was the order book, what was it six months ago and how it has improved now, so you can think of for growing in the coming period?

The sales engine was dormant per se. We were not really accelerating at the level we wanted to. And if I look at it from a pure investment extraction, in terms of our SGNA, it was the extraction. In fact, that is one of the important focuses. How do we get our SGNA investments to sweat and build order book.
Definitely we are running with a target to exit this year. We are running with at least a target of 100Cr order book. So that next year we have at least realization of that revenue. Our gates are higher and we want at this target a minimum gate of around 25% margins in this order book.
We also kind of renewed some of our existing contracts with additional revenue. FT business is different from transaction-based pricing business, so definitely the transaction based pricing, whether it's per ticket or change request.
We want to look at a minimum, an offset of at least around 15%; 10-15% clear-cut eliminate of waste and increase our utilization. Also, from an end to end process perspective, from order to cash even for entire DSO cycle. These are very important projects to reduce the unbuilt because unbuilt is a bane of any it industry today and also to kind of reduce unbuilt and also to get faster revenue recognition and also bring down the PSOs in terms of cash and bank as well. In fact, we brought it down from already from 108 to almost 95 DSO and it keeps improving faster. So working cut cycles are coming down soon. So that's where we are fundamentally.