'EG - biz FirstsourceFirstsource lowers revenue guidance for FY'22; Mexico delivery centre to get live in March

RP Sanjiv Goenka group owned business process management services company, Firstsource Solutions Ltd, lowered the revenue guidance for the current fiscal to 14-14.5 per cent down by 100 basis points over earlier projections owing to headwinds in some of the sales segments, company sources said on Sunday.

The first delivery centre in Mexico, targeted at US clients, is expected to go live in March, they said.

The company has completed two acquisitions, American Recovery Services Inc (ARSI) and StoneHill, during the third quarter and is excepting bottoming out by Q4 ending March '22.

"We have brought the full year guidance down to 14-14.5 per cent. Taking the full quarter impact of the acquisitions, collection is starting to turn around. We're starting to see green shoots of a higher volume. ''Obviously, they won't show up in the revenue for Q4. But I'm cautiously optimistic that it will start to climb up through Q1 and kind of continue to climb through Q2 of FY'23," an official told PTI.

In another development, Firstsource was actively evaluating nearshore locations for the US and the UK markets to address the structural demand-supply challenges in the onshore markets.

"We opened our first delivery centre in Mexico, creating a nearshore option for our US clients and we will go live with a large health plan next month," an official said.

The company, which has a huge dependency on developed overseas markets like the US and the UK, faces headwinds in mortgages and provider business segments, the company said. In the Q3 FY '22 revenue came in at Rs 1,463 crore or USD 195.4 million in dollar terms, which is year-on-year 7.2 per cent in Rupee term.

The operating margin or EBIT is Rs 176 crore or 12 per cent of the revenue for the quarter.

The new acquisitions will add to about four per cent while 10 per cent growth will come from organic growth in the total 14-14.5 revenue growth target for the current fiscal.

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