IT mid-caps turn to M&As to race past their bigger rivals

The change in strategy comes as AI and weak demand reshape India’s IT services industry

- Jas Bardia

India’s mid-sized information technology (IT) services firms, earning $1-2 billion in revenue, are cumulatively expected to turn in more new business than their larger peers this fiscal, for the first time ever.

The growth hack is simple: acquisitions.

Their acquisitions are only seen expanding from the current aggressive pace. IT mid-caps are expected to acquire more companies than their larger peers to scale quicker, as the rise of automation raises concerns about their relevance and threatens to eat into their revenue, at least three experts said.

Three of the country’s six mid-sized IT services companies—Coforge Ltd, Mphasis Ltd and Hexaware Technologies Ltd—closed three acquisitions in the April-June 2026 period and are expected to add $647 million in new business through buyouts in FY27. This is almost three-fifths of the $1.16 billion in incremental revenue they earned over the last fiscal year. The other firms in the $1-2 billion revenue space are Persistent Systems Ltd, Sonata Software Ltd and Firstsource Solutions Ltd.

In comparison, the acquisition volumes and the revenues the buyouts are set to fetch for five—Tata Consultancy Services Ltd, Infosys Ltd, HCL Technologies Ltd, Wipro Ltd, and Tech Mahindra Ltd—of the six largest firms seem muted so far.