HCLTech forms Neo.AI unit to target mid-market clients, challenging firms like Coforge. Unit aims to deliver 60% of work via AI agents. 90 accounts already transferred.
HCL Technologies Ltd is the first Indian IT services firm to create a dedicated business unit for smaller companies, two people with knowledge of the matter said. The new unit, called Neo.AI, will manage software development, maintenance and data analytics for mid-market clients through the company's AI platform and IT offerings.
The move marks a shift for the country's third-largest IT services company, which has long drawn most of its revenue from Fortune 500 clients. Indian IT's big five–Tata Consultancy Services Ltd, Infosys Ltd, HCLTech, Wipro Ltd and Tech Mahindra Ltd–each get at least a fifth of their revenue from their 10 largest accounts.
HCLTech ended last fiscal year with $14.66 billion in revenue and is expected to grow 1-4% in constant currency terms this year. The new unit is expected to bolster that growth, the people said.
Neo.AI will also challenge mid-sized IT services companies including Coforge Ltd, Persistent Systems Ltd and Mphasis Ltd, one of the people said.
“The broad intent is to target small companies with small pockets of spending and to deliver shared services using the AI Force platform,” the first person said on condition of anonymity. That would target the base of mid-tier IT services firms that rely on smaller companies for much of their business.
HCLTech is targeting about three-fifths of the IT work through internally developed AI agents while the rest will be managed by humans, the second person said.
“The goal is to get as many clients as possible to use HCLTech’s software and AI platforms for much of their business needs. The company is looking to onboard multiple clients on one software platform which would then be modified based on their needs,” the first person added.
Company veteran Ashish Kumar Gupta was named head of the unit earlier this fiscal, though HCLTech has not yet made a formal announcement. The company's FY26 annual report lists him as global head of a New Business Incubation Group. Gupta has been with the company for more than two decades and previously headed its Europe, West Asia and Africa business, which accounts for more than a fourth of revenue. The unit also hired Aditya Chawla as an area sales director last month.
About 90 accounts have been transferred to Neo.AI, and the company plans to target at least 500 more small accounts, the second person said. The unit has at least 300 executives, and the sales rollout is “more-or-less complete,” the person said.
“Currently, sales executives want to protect the existing book of business from getting eroded due to AI. With this new unit, there will be a new sales approach where they start with smaller AI deals and then scale the same accounts once return on investment is visible,” said Amit Chandra, vice-president at HDFC Securities.
An email sent to HCLTech on Saturday seeking comment was not answered.
Last month, Accenture Plc said it would form a small business group to tap smaller firms. “We are also expanding our total addressable market by going after a new, exciting customer segment: the mid-market,” Julie Sweet, Accenture's chief executive officer, said on June 18. Accenture launched Accenture Edge to get more business from mid-sized firms and will offer Microsoft Corp.'s software to mid-sized clients in areas including cloud, AI and cybersecurity. Sweet estimated the mid-market – companies with between $300 million and $3 billion of revenue – as a $240 billion addressable market for Accenture, growing in high single digits.
Data protection will be a key challenge for HCLTech's new unit, Chandra of HDFC Securities said. "The biggest challenge that these companies will face is to ensure the data of each client sits separately and is protected, especially because they are using the same platform."
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