11. ICICI ONESOURCE: Epitome of Inorganic Growth

FACT FILE CEO Ananda Mukerji POSITIONING Primarily an inbound voice service provider STARTED IN Dec-01 OWNERSHIP ICICI Bank, ICICI Venture Capital, Westbridge Capital Partners TOTAL FUNDING $50 mn REVENUE (2002—03) $17.4 mn (estimated) NO OF PEOPLE 3870 (as on 31 Oct 2003) CORPORATE ADDRESS 6th Floor, Peninsular Chamber, G Kadam Marg, Lower Parel, Mumbai—400013 WEBSITE www.icicionesource.com NO OF CLIENTS 21 (including 14 large ones)

COPC 2000 for both voice and back office. The first company in the world to get COPC certification for back office. BS 7799 British security certification Six Sigma initiative

LOCATION

FACILITIES: 4 (Bangalore–3, Mumbai–1) SALES & MARKETING: New York, US and London, UK

ICICI Onesource is truly the odd man in the Top 10 club of bpOrbit. The
company that was started by acquiring another company is not just the only BPO
company to try out a combination of organic and inorganic growth, but also is
the only company in this elite group that is owned by a non-IT corporate. ICICI
Bank holds 27.5 percent in the company while ICICI Venture Capital owns 64
percent of the equity. About 8.5 percent is owned by Westbridge Capital
Partners.

This gives the company a unique advantage–that of acting like an
independent VC funded company to decide its own focus as far as verticals and
processes are concerned (the company’s top vertical is retail, not financial
services, as the ICICI name tends to suggest) and yet not worrying too much
about access to capital, as with other VC-funded companies. This, coupled with
the fact that its top client contributes just about 20 percent–the figure is
half of the corresponding figure for many others in this list–of its revenue
also means the company is not too dependent on any one client. Looking at
fundamentals, the company is well-positioned.

However, it is a predominantly voice company. Though inbound voice–its
forte–will grow for some time, the margins are expected to get increasingly
squeezed. That is a cause for worry. Also, the acquisition of FirstRing gave it
a foothold in the telemarketing, a service whose future is being questioned in
the post Do-Not-Call scenario. Thankfully, telemarketing is less than 10 percent
of its operations.

Keeping in line with its inorganic growth strategy, ICICI Onesource has been
looking around for acquisitions continuously. It is believed that the
acquisition(s) would be used for increasing the company’s exposure to
financial services and setting up centers in alternate locations outside India.
The company is seriously looking at the Philippines and Mauritius for locating a
facility, either through acquisition or by building up on its own. These will be
in addition to the three facilities that it has in Bangalore, one in Mumbai. The
company is opening up another facility in Mumbai next year and is also looking
at a third location within India.

Apart from Marks & Spencer, its other large customers include Providian
and Amex (that it got through FirstRing acquisition), a Fortune 50 telecom
company, and an FTSE 100 media company.

Apart from expansion, ICICI Onesource is expected to diversify the nature of
its processes in the next year.