HCLTech’s Neo.AI Unit Chases the Business Its Mid-Tier Rivals Built

HCLTech has built a stand-alone unit, Neo.AI, to chase companies worth $1 billion to $5 billion in revenue, its first dedicated mid-market push. It is the first such unit built by one of India’s top IT services firms, according to Mint, which cited two people with knowledge of the matter. The country’s third-largest IT services company is going after business its smaller rivals already own.

HCLTech wants AI agents, not people, to handle three-fifths of that work. The accounts it is chasing built Coforge, Persistent Systems and Mphasis into the fastest-growing names in Indian information technology (IT) this year.

Neo.AI’s $1 Billion Floor

Neo.AI will manage software development, maintenance and data analytics for mid-sized clients, delivered through HCLTech’s AI Force platform and its existing IT offerings. The work breaks into three broad buckets, according to Mint’s reporting:

• Software development for mid-sized clients’ internal systems
• Ongoing maintenance of existing IT infrastructure
• Data analytics delivered through HCLTech’s AI Force platform

Earlier this fiscal year, HCLTech named company veteran Ashish Kumar Gupta to head the unit, though a formal announcement has not followed. HCLTech’s FY26 annual report lists him as global head of a New Business Incubation Group. Gupta spent two decades at HCLTech and previously ran its Europe, West Asia and Africa business, which the company says now accounts for more than a quarter of total revenue. Under his watch, that region’s business grew from $110 million to $3.5 billion between 2005 and 2024, according to his official HCLTech biography. The unit also hired Aditya Chawla as an area sales director.

The numbers behind Neo.AI are already substantial. About 90 accounts have been transferred into the unit, and HCLTech is targeting at least 500 more small clients, according to one of the two people. The unit has at least 300 executives, and its sales rollout is, in that person’s words, more or less complete.

Why HCLTech Needs a Second Engine

India’s IT giants built their businesses on the Fortune 500. Tata Consultancy Services, Infosys, HCLTech, Wipro and Tech Mahindra, the country’s big five, each draw at least a fifth of revenue from their ten largest accounts.

That concentration carries a cost. HCLTech ended its last fiscal year with $14.66 billion in revenue and is guiding to just 1 to 4% growth in constant currency this year, a term that strips out currency swings. Its most recent quarter showed the strain: revenue rose 13.9% in rupee terms but only 2.6% in constant currency, to 34,579 crore rupees (about $3.65 billion). Net profit climbed 20%, and the company is putting 3,500 crore rupees into a new AI data centre while holding its full-year guidance steady.

That exposure already cost HCLTech work this year. The company lost the Xerox contract that shifted to the Philippines, a reminder that a single large client walking away can dent a quarter almost overnight. A mid-market book built from hundreds of smaller accounts spreads that risk differently, even if none of those accounts individually moves the needle the way a Fortune 500 client can.

Why Are Mid-Tier Rivals Growing So Much Faster?

Coforge, Persistent Systems and Mphasis do not chase the Fortune 500 the way HCLTech does, and it shows in their growth rates. All three posted double-digit revenue gains over the past year while TCS and Wipro, the two largest firms most dependent on giant enterprise contracts, both shrank in constant currency terms.

Persistent Systems, for instance, said its fiscal second-quarter revenue reached $406.2 million, up 17.6% year on year. Mphasis posted a record book-to-bill ratio even as its bigger rivals struggled to keep deal pipelines full. That same split showed up in Wipro’s own numbers, where quarterly profit barely moved from a year earlier, underlining how flat the large-cap end of the industry has become. Neo.AI is built to plant HCLTech directly inside the segment fueling that gap. Mint’s sources said the new unit will directly challenge Coforge, Persistent Systems and Mphasis by going after the smaller clients those firms depend on for much of their business.

Borrowing Accenture’s Playbook, Then Changing It

HCLTech is not first to spot the opportunity. Accenture, the world’s largest IT services company, made its own ambitions official when it formally launched its mid-market unit, named Accenture Edge, on 23 June. Days earlier, at an investor event on 18 June, chief executive Julie Sweet had previewed the move, saying Accenture was expanding its addressable market by going after “a new, exciting customer segment: the mid-market.” Sweet put a number on the opportunity: a $240 billion market growing at a high single-digit pace, made up of companies with $300 million to $3 billion in revenue.

Accenture Edge covers core system modernization, AI adoption, cybersecurity and operations, and it leans on Avanade, Accenture’s joint venture with Microsoft, to deliver Microsoft’s cloud and security tools to smaller clients. Sweet has framed the pitch around speed rather than scale, saying mid-sized companies “face many of the same technology, data, AI, cybersecurity and productivity challenges as large enterprises, but they need solutions that are faster to deploy, more repeatable and right-sized for their scale.”

HCLTech’s band sits higher, at $1 billion to $5 billion in revenue rather than Accenture’s $300 million to $3 billion, and its pitch leans harder on automation than on partner integrations. Where Accenture Edge bundles in Microsoft’s software stack, Neo.AI is built to push clients onto HCLTech’s own AI platform and keep them there.

Machines Do Three-Fifths of the Job

HCLTech is aiming to deliver about 60% of Neo.AI’s client work through its own AI agents, with the remaining 40% handled by people, according to one of the two people familiar with the plan. The goal, that person said, is to get as many clients as possible onto one shared software platform, then adjust it client by client rather than build bespoke systems for each account.

That ambition lines up with what is already happening across the rest of HCLTech’s business.

• 60% of Neo.AI’s client work is meant to run through HCLTech’s own AI agents, with people handling the rest
• 223,889 employees remained on HCLTech’s books at the end of Q1 FY27, a net drop of 3,292 from the prior quarter
• $171 million in Advanced AI revenue landed in that same quarter, up 62% from a year earlier in constant currency
• 500 more small accounts is the near-term target, on top of the 90 already moved into the new unit

HCLTech’s management has said the headcount decline reflects demand-based hiring alongside growing use of automation in service delivery, even as the company still added over a thousand entry-level hires during the quarter. Running hundreds of unrelated clients through one shared platform raises a separate problem, according to Amit Chandra, vice president at HDFC Securities, a Mumbai-based brokerage. “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,” Chandra said.

HCLTech’s Own Sales Force Has Reservations

The bigger friction may be internal. HCLTech’s enterprise sales teams built careers protecting large accounts, and AI-heavy delivery threatens the size of the deals they are used to closing.

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.

Chandra said that shift explains why Neo.AI exists as a separate unit rather than an add-on to HCLTech’s existing sales motion. Starting small, proving the AI-driven model works, then expanding within the same account is a different sales cycle than pitching a Fortune 500 chief information officer on a multi-year enterprise contract.

HCLTech has not confirmed any of this publicly. An email seeking comment on the new business unit went unanswered Saturday. The sales rollout chasing those 500 accounts, according to the people familiar with the plan, is already more or less done.