• Merger and valuation: ITC Infotech is acquiring a 22% stake in Happiest Minds for ₹1,329 crore ahead of a full merger, with Happiest Minds valued at 15.1x EBITDA versus ITC Infotech's 13.6x to reflect an AI premium.
• Combined entity scale: Management plans to integrate within 15 months to establish a combined entity of approximately 19,000 employees across 30 countries and 800 clients, pairing traditional CIO services with digital and AI engineering capabilities.
• Revenue growth target: The merged company targets $1 billion (₹9,500 crore to ₹10,000 crore) in revenue by FY28 based on combined historical annual growth rates of 15% to 16%+, with currency exchange rate fluctuation cited as the primary risk.
• Operating margin projections: Combined operating margins are projected to hold at roughly 18% based on the standalone performance of both businesses, without factoring in any assumptions for post-merger cost cuts.
• Promoter exit terms: Founder Ashok Soota will divest an initial 22% stake across two tranches to fund Happiest Health, and his remaining 7.5% to 8% holding will reclassify him as a public shareholder with no selling restrictions after 1.5 years.