Finally I am Biting the bullet and Buying ITbees, Here’s the Thesis:
1. The world is moving from Software to Hardware, think SaaS/product to Chips/Energy/Power. India is behind, and the government push and private sector risk capital is the only way forward for growth.
2. While Indian IT services are shrinking, GCCs are booming, I believe they are a bigger threat to these services companies than AI is.
3. Expecting them to build large-scale AI models or infrastructure using their capital is just wishful thinking. Their culture, business model, and people are not made to take moonshots or risk shareholders’ capital.
4. But what they do is still very important and provides value to the world at large. No Bank or Retailer or even a Government, large or small, would ever be confident to build, implement, and maintain their tech fully in-house.
5. IT services will eventually catch up as they are very good at implementing tech at a cheaper rate, think Y2K, cloud, and any other tech transformation in the past.
6. They might have a different billing strategy, but they will still be here even 20 years from now and will keep hiring cheap labour to implement the latest AI agent for the Fortune 500 clients.
7. Some things never change, they just have a bigger cycle time, and this cycle shall also pass.
It can still go low from here as can be seen in the chart, So starting with 2% position, will add on dips
Valuation are good, Dividend yield is juicy
Lets see how it pans out from here
Disclaimer: I am not Sebi RIA, this post is only for educational purpose.
