Two US-listed Indian outsourcing firms -- Cognizant Technology and EXLService -- have made it to a list of the world's 100 "hot growth" companies with significant growth potential.
The two Indian firms are among 10 software and services firms that have appeared in the list of companies from around the world.
Cognizant, which is headquartered in the US and having most of its operations and 75 per cent of workforce in India, has been ranked at 15th position, while EXLService is at 57th rank.
The annual list, published in the latest issue of BusinessWeek hitting the news stands today, is led by Heelys Inc, a maker of wheeled sneakers used by kids for skating.
The magazine used Standard and Poor's database of 10,000 public companies with revenues of 50 million dollars to 1.5 billion dollars a year and the rankings are based on three year sales and earnings growth as well as return on capital.
Only those companies with a market cap of 25 million dollars or more and a stock price of at least five dollars were considered, the magazine said, adding that "profit or stock price shortfalls, or news that put prospects in doubt, may knock a company off the list."
According to the US-based magazine, Cognizant that is the fifth-largest Indian infotech outsourcing firm has consistently racked up better growth rates than its larger rivals with more than 43,000 employees.
In the first quarter this year, the company's turnover rose by 61 per cent to 460 million dollars.
"It has outperformed its peers because it has deftly targeted a handful of industry segments where demand for offshore outsourcing is strongest, including financial services, health care, and pharmaceuticals," the magazine said.
Amid concerns over wage inflation and rupee appreciation, which are making Indian labour more expensive, Cognizant is trying to modestly restrain its hiring activities, BusinessWeek noted.
The company's newly promoted CEO Francisco D'Souza had planned hiring more than 17,000 people this year but reduced that number by 1,000, it said.
Another Indian entity in the list, EXLService, which listed in the US last year, has a total headcount of close to 8,200 employees and reported 85 per cent jump in its first quarter revenue to close to 40 million dollars.
The company was founded in 1999 and is already providing a vast range of business process outsourcing solutions like transaction-processing services and Internet and voice-based customer care services to Global 1000 companies in banking, financial services and insurance segment.
EXLService has a market cap of close to 540 million dollars, while that of Cognizant currently stands at about 11 billion dollars.
BusinessWeek noted that Cognizant has been on the list for six years running and seven times since the list was launched in 1985.
The IT services firm faces stiff competition from bigger competitors like Wipro and Infosys, but it continues to offer "better, faster, cheaper" services than other IT outfits, it said. "And being better and faster than the next guy is what Hot Growth is all about."