Reporter's Diary

MUMBAI, INDIA: It is all gloom, but definitely not doom. Business will continue to be done, and companies will, albeit not very aggressively, continue to scout for companies, who can help them maximizing their investments in long run.

So who will be the lucky ones, who can attract money and buyers even in these uncertain times?

Sanjeev Aggrawal, managing director, Helion Partners, today said at the NILF here that four sectors are perched high atop the acquisition and investment agenda for companies and venture capitalists for 2009.

“The conditions are difficult, but not too bad to stop interested parties to look for new companies. The key is companies who have great technology, strong focus and have full team in place will find strong traction among interested parties,” says Sanjeev.

He adds that companies operating in four verticals in current times look very attractive to potential buyers and venture capitalists.

Outsourcing Sector

Sanjeev feels that due to recession, the outsourcing sector will be very attractive to potential buyers and investors, provided they have a strategic focus, strong domain expertise and ability to scale as well as complete leadership team.

“Most of the times, outsourcing service providers have leadership team that is India heavy, and not many people from the US. This makes it an unattractive option. Companies should look building dual gravity teams, which mean leaders at the helm, who have knowledge of both continents,” he adds.

Consumer Internet

In Sanjay’s opinion, Internet companies on their own don’t make a good buy, but when married to other processes it can be an attractive option.

For example, Makemytrip is not only an Internet company. You can interact with the company at various levels  – be it through mobile, through its retail centre and also through its call centre.

He adds that most of the times Internet companies don’t have a complete team. “Either the technology team is too strong, which overcompensates for marketing and leadership. The basic thing is all the elements need be brought together.

Because Internet is not ubiquitous, the sector will attract niche buyers for the time being.

Mobile VAS

According to Sanjay, with telecom operators faced with lower Average Revenue per User (APRUs), Mobile Vale Added Service providers are a good bet for potential buys.

However, he adds the current lopsided revenue sharing agreement between telecom operators ad service providers means MVAS players have to churn out more volumes to show profits.

Product Companies

The Helion Partners MD says the product companies that have a great technology will always remain great buy with potential investor. However, he added that technology companies don’t have great leaders who know how to carry the technology to next level.

“They need to hire CEOs who can help them to reach the next frontier,” adds Sanjay.