The JV aims to create a next-generation digital and IT services company in Saudi Arabia to provide technology services for the rapid digitisation of the Saudi market and build a local talent pool over a period of time.
LTIMindtree president and executive board member Sudhir Chaturvedi told PTI that the company’s collaboration with Aramco Digital will establish a next-generation digital and IT services company in Saudi Arabia.
“We are going to make sure that like we do in India, wherein we hire both experienced professionals as well as freshers from universities and then train them into the process. Essentially, we will replicate that model there, obviously with nuances, which are specific to the Saudi market. As part of the focus, this aims to enhance women’s employment in the Saudi market,” Chaturvedi said.
LTIMindtree will hold a 51% stake in the company while Global Digital, a completely owned subsidiary of Aramco, will hold the rest of the stake.
The JV was announced on March 6 and will become operational from July 1.
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Chaturvedi said the JV was formed after a competitive process, in which more than 20 companies across the world participated, and LTIMindtree emerged as a successful partner after about two years long process. He said that Saudi Arabia is the biggest driver of this growth in terms of tech spending, as there is massive tech spending happening in the giga projects like NEOM, Red Sea Global etc, in Saudi Arabia.
“There are around 12 giga projects going on in the Kingdom right now, and all of the infrastructure is essentially cloud-based. What we’ve seen in India as part of Digital India, some of the modernisation that we’ve seen in the ministries is what we’re going to start in the Saudi market as well as the other markets in the MENA region,” Chaturvedi said.
Talking about the impact of the JV amid global macro-economic concerns, Chaturvedi said that while there is a cautionary environment across the globe where clients are very focused on cost, the Saudi market is not price sensitive but rather it is sensitive to execution capabilities and the quality of technology that is offered.
He, however, said that the contribution of margins from JV will be a small part initially, but it has huge potential in the long run.
“The KSA and MENA region together is a large market and will continue to grow even more with the potential and the tech spending that we see in that market. We want to make sure that we capture a large share of that market. We are going to make significant investments over the years,” Chaturvedi said.
LTIMindtree has posted about 17% increase in consolidated net profit to Rs 1,169.3 crore and about 5% growth in revenue from operations on a year-on-year basis in the December 2023 quarter.
