Firstsource, Sagility poised to benefit as AI reshapes global BPM market: PL Capital

Firstsource Solutions Ltd: The company has rolled out its UnBPO framework alongside proprietary suites like relAI and its Kairos operating system, designed specifically for regulated operational environments.The global business process management industry is undergoing a structural reset, pivoting away from low-cost headcount delivery toward artificial intelligence-orchestrated intelligent operations.According to institutional brokerage PL Capital, this technological migration is set to expand the sector’s total addressable market rather than compress it, positioning domain-focused Indian providers such as Firstsource Solutions and Sagility to capture durable, multi-year operating expansion.Market enters AI-led growth phaseThe brokerage highlighted that the global business process services market is projected to accelerate to a compound annual growth rate of 4 per cent between calendar years 2024 and 2029, reaching $268 billion, up from 3 per cent in preceding years.The Indian business process management space has outpaced the global curve, clocking a 9.3 per cent compound annual growth rate between fiscal 2022 and 2026 to reach $63 billion, accounting for 20 per cent of total Indian IT expenditure.Commercial engagements are shifting fundamentally, with PL Capital noting that outcome-based models will climb from 10 to 15 per cent of the Indian market in fiscal 2024 to between 30 and 35 per cent by fiscal 2027, while platform-led services are slated to rise to between 25 and 40 per cent.Agentic AI opens $100-400 bn opportunityPL Capital observed that moving into adjacent agentic AI workflows offers an incremental spend opportunity of $100 billion to $400 billion industry-wide by the end of the decade.While 67 per cent of enterprise buyers expect service providers to take the lead in enterprise AI deployment, only 21 per cent have the internal talent to manage and govern AI-led operations, it said.Within this landscape, PL Capital pointed to Firstsource Solutions and Sagility as a prime example of successful business re-engineering.“We believe Firstsource Solutions (FSOL) and SAGILITY, with their strong domain positioning and exposure to complex and highly outsourced processes, are well placed to capture the next leg of growth as the industry transitions from people-led operations toward AIenabled intelligent operations,” PL Capital said.Firstsource shifts towards higher-value workflowsFirstsource has systematically reduced its dependence on the rate-sensitive US mortgage refinancing segment, lowering its overall banking and financial services exposure from 51.9 per cent of revenue in fiscal 2021 to 32.4 per cent in fiscal 2026.In contrast, higher-margin healthcare workflows now represent 33.4 per cent, media and technology stands at 21.3 per cent, and its diverse industries segment has expanded from 0.1 per cent in fiscal 2018 to 13 per cent in fiscal 2026, powered by targeted additions such as Ascensos and Pastdue Credit, it said.The company has rolled out its UnBPO framework alongside proprietary suites like relAI and its Kairos operating system, designed specifically for regulated operational environments.From a financial perspective, PL Capital estimates that Firstsource will deliver a compound annual revenue growth rate of 10.4 per cent between fiscal 2026 and fiscal 2029.Sagility bets on healthcare cost pressuresTurning to Sagility, PL Capital identified the pure-play US healthcare specialist as a direct beneficiary of mounting financial strain across the American medical ecosystem.

The median Medical Loss Ratio across Sagility’s six largest health insurer clients surged 620 basis points from 83.9 per cent in 2018 to 90.1 per cent in calendar 2025.The company has strengthened its operations through strategic acquisitions, embedding payment integrity through Devlin Consulting, generative AI through Birch Technologies, mid-market health plan relationships through BroadPath, and quality analytics through CareSeed.Consequently, PL Capital projects Sagility’s revenue to expand at a 12.5 per cent compound annual rate in dollar terms between fiscal 2026 and fiscal 2029.