ExlService and Genpact, two of the fastest growing offshore BPS pure plays released their Q1 results yesterday, but there are signs the bigger of the two Genpact is now starting to flex its muscle with headline growth of 15.7% vs. EXL’s 11%.
Genpact’s headline revenue reached $503.8m, actually 
marginally down quarter on quarter (qoq) (see Genpact sets the BPS pace) meanwhile the net income margin grew 0.4 bps to 9.3%, although down from 10.5% in Q4.
Genpact’s top line looks impressive, but there is some inorganic growth in here from February’s acquisition of JAWOOD (see Genpact acquires US healthcare payer business), which apparently would have knocked growth down to 14%. However there will also have been revenue from last March's acquisition of Netherlands-based Accounting Plaza (see here). Genpact didn’t disclose organic growth, but we suspect it was still in double digits.
EXL’s headline revenue reached $116m in Q1, meanwhile the net income margin was more or less flat at 8.4%, and down 2 points from Q4. Unlike Genpact, the top line would have been largely organic, so both players are probably tracking similar growth rates organically. EXL is much smaller however, so the slower growth is a more significant indicator that Genpact is stretching its lead.
Both companies are pushing ahead with investments in business process analytics, an area we see having significant growth potential over the next few years (see Predictions 2013: Business Process Services). EXL for instance, recruited c160 people from major Indian universities, bringing its total headcount in analytics to over 1,000. CE Rohit Kapoor however sees analytics talent being in short supply globally. This will no doubt will restrict growth. Suppliers will therefore need to do all they can to attract the best people, so competition looks set to get even fiercer.