IT-BPM growth moderates, quality over speed
From AB Capital's The Opening Bell: Three Moves
Event
IBPAP reported 2025 IT-BPM export revenues grew 5% to over US$40bn, while headcount rose 4% to 1.9mn. Growth met roadmap baselines but slowed versus high-single-digit expansion pre-2023, reflecting a larger base and lingering global macro and geopolitical uncertainty.
View
We think 2025 growth is weaker than prior years, but healthier in composition. Expansion is increasingly driven by global capability centers and higher value services rather than volume growth. This supports margin stability and resilience, though limits near term GDP upside.
Catalyst
Key catalysts include new GCC announcements and 2026 roadmap guidance. Upside surprise comes from faster GCC inflows, especially in BFSI and healthcare. Downside risks are talent constraints and incentive slippage.
Action
We prefer office-heavy REITs and developers with GCC exposure, notably AREIT, RCR, and ALI. Valuation support comes from stable occupancy and rental reversions.
Disclaimer: The information, analyses, and views contained herein is based on sources which we, AB Capital Securities, believe are reliable, but is not guaranteed by us and is not to be considered all inclusive. It is not to be construed as an offer or solicitation of an offer to sell or buy the securities herein mentioned. AB Capital Securities and its Directors and Officers and/or members of their families may have a position in the securities herein mentioned and may make purchases and/or sales of the securities from time to time in the open-market and otherwise.
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