Answer:
The acquisitions would help the company.
We already know that the customers are mainly in the US, in the middle east
and in the Europe, with a single majority or a large chink of them located in US.
It is also given that India single handedly contributes for about 73% of
resources, with this in mind and also noting down that 60% of the contractors
are also in India, it is now important to note as to where the margin of profit is
high. We find that the margin is really high in the US and comparatively less in
India.
One major thing we got to notice is the population in India, it is simple
understanding that companies in India are more likely to have a large customer
database, even though the companies are quite small, we can notice that the
companies would have a bigger database owing to its high population and high
population density when compared to the companies in the US.
Acquisition of companies in India would give the company a much higher
advantage this way as the employee contracts as well as the resources are
again available in India.
With the employees and the resources available in India, if smaller companies
that provide niche technologies with a comparatively bigger database are
acquired, it would directly mean the optimal usage of resources and efficient
work by employees, with regional data available. It is a win-win as the
companies provide technologies and this could well be used in different
countries as well.
Therefore, if the company is looking forward to invest in acquisition, it could be
in India and it would definitely help in the improvement of margins and would
certainly allow the company to give a stiff competition to other comparable IT
companies as well