EXCLUSIVE | 'AI is a massive tailwind, not deflationary': Coforge CEO Sudhir Singh on why business-led AI solutions are driving growth | VIDEO INTERVIEW

ET Now Exclusive: Coforge MD & CEO Sudhir Singh explains why AI is not deflationary but a powerful growth tailwind for solution-driven IT firms. He outlines how AI fluency, large deal momentum, sector-specific solutions, and new performance metrics like revenue per employee and deal velocity will define winners in 2026.

In an exclusive interview with Sajeet Manghat on ET Now's show Deep Dive, the discussion covers the sector outlook, AI monetisation, margin dynamics, and what investors should track next as India’s IT industry navigates the AI transition.

On AI moves and how Coforge is managing the entire expectation, he said, "We've focused on creating AI fluency across our customer base and internally, believing AI is a significant tailwind for the industry. We're driving business-led AI solutions, making tech budgets elastic. We've maintained AI is a business imperative, not just a tech one, and are seeing growth through this approach."

On genAI going to impact the productivity of existing order books and bring in better opportunities, he said that we're seeing AI drive productivity and new opportunities. With AI fluency, we're structuring end-to-end solutions addressing client business issues, making budgets more elastic. We're focused on business-led AI, not just tech-led, which is driving growth.

He further said that we are seeing significant AI disruption in sub-segments including:

He said that the metrics have shifted. Revenue is important, but leading metrics like large deal velocity, EBIT, and revenue per employee will be key to assessing AI-driven growth and value addition.

He said, "The metrics have moved away from just assessing business teams, business leaders, and sales leaders on just revenue and EBITDA, which were the metrics earlier. Instead of revenue alone, we increasingly look at the velocity and the median size of large deals that are being signed. Our belief is that large deals and order books are not a lagging metric like revenue is, but they're a predictor of what the future on the growth front is going to be."

"So, increasingly on the revenue side, you might find that analysts and firms internally like us are looking not just at revenue, which is a lagging metric, but also looking at the velocity of large deals getting signed and the median size of the large deals getting signed," he added.

The second thing that I suspect will slowly start inching in is that we've all within this industry largely looked at EBITDA as the principal margin metric. You might find with acquisitions and mergers becoming more common, EBIT is a metric that does factor in amortisation and depreciation that comes as a consequence of those M&As becoming more important. So, that's going to be the second metric that we see.

He further said, "I guess EBIT will become as important as EBITDA, even internally for firms like us, and third, of course, revenue per employee will continue to be a big metric to figure out what is the true value addition being offered by teams and to what extent it is being recognised and paid for by the end recipient, which is clients."