Captive buyouts: Are IT cos scaling up or skilling up?

Indian IT companies are increasingly acquiring client technology units and specialised businesses to anchor much larger, long-term partnerships, in what amounts to a captive centre redux, according to Shilpa Phadnis’ report by Times of India (TOI). The playbook, as TOI put it, is simple: buy the captive, win the bigger deal.

The trend has revived an old debate on whether these deals are about acquiring capabilities or simply adding to capacity, TOI reported. The strategy is being driven partly by the need to grow contract values as organic revenue growth slows for Indian IT firms and artificial intelligence reshapes traditional technology spending.