Employees at an IT firm in Bangalore
Employees at an IT firm in Bangalore [Representation Image]Reuters

Domestic IT services firm Mphasis will move 2,000 employees to Karvy Data Management Services Ltd (KDMSL) as part of a deal signed to partially sell its domestic outsourcing business to Karvy.

Reacting to the news, the share price of Mphasis touch an intra-day high of Rs 415.55 on Friday on the Bombay Stock Exchange (BSE), before paring some gains to close at Rs 404.00, up 2.15% from the previous day's close.

"KDMSL is optimistic about the overall business growth in India and hence better business volumes. Our pedigree and footprint in the country would enhance and integrate service offerings to clientele in addition to the existing voluminous transaction processing capabilities," V Mahesh, Managing Director, Karvy Data, told The Economic Times

The move to transfer a portion of its outsourcing work is Mphasis's second such agreement as it tries to reduce its exposure to domestic business process outsourcing sector.

"Specialization and consistent strategy execution holds the key to success. This definitive agreement offers tangible proof of our commitment to execute our strategic road map," said Ganesh Ayyar, CEO of Mphasis, said in a statement.

Earlier, Bengaluru-based Mphasis had sold a significant part of its outsourcing business to Hinduja Global Solutions (HGS), which saw transfer of more than 7,000 employees to HGS.

The deal was valued at Rs 17 crore and resulted in two-thirds of Mphasis' employees in domestic voice business moving to HGS.

"A dedicated unit has been set up to ensure smooth transfer for all employees. There would be no loss of jobs or headcount reduction," Elango R, chief human resources officer and head of emerging geographies business unit of Mphasis had said on 1 July.