Over the last one year, the third-party BPO outfit acquired two relatively small BPOs -- Customer Asset for $18 million and First Ring in a part-cash part-share swap deal.

Outsourcing and India: Complete Coverage

Ananda Mukerji, managing director and CEO of ICICI oneSource, said the plan is to transform ICICI oneSource into an end-to-end service provider.

It plans to get into new areas like research and analysis, collections and loan processing. So far, the focus has been on call centres, customer service and customer acquisition through tele marketing, and transactions and processing.

"We will look for an IPO at an appropriate time," the CEO said. Market sources pointed out that ICICI oneSource could go for an IPO next year after gaining in size through acquisitions and by adding new businesses.

At present, ICICI oneSource employs 4,000 employees and has 14 large and six small customers across the US and UK. Mukerji refused to name the customers but said they are in financial services, telecom and retail sector. He also said that the outfit has made profit in its second year of operation.

Meanwhile, Temasek Holding, a Singapore investment company with assets over $59 billion, may pick up a stake in ICICI oneSource. India is one of the target markets for Temasek which now holds 8.6 per cent in ICICI Bank, 7.73 per cent in Matrix Lab and 5.4 per cent in Aurobindo Pharma -- two pharmaceutical companies.

An industry analyst said the Indian BPO sector has hit an inflection point. Scalability is perceived as the single biggest survival tactic for any BPO company.

With the volume of work and customer expectations constantly on the rise, companies are expected to come equipped with the ability to ramp up infrastructure and manpower at short notices.

So most BPO companies are ready for a fresh round of fund infusion but unfortunately for them this is also the time when most venture capitalists are looking to cash out.

This state of affairs leaves small scale BPOs (capacity of less than 2000 seats), entrepreneur-driven third parties and other independent BPOs looking to scale-up vulnerable to takeovers.

Industry watchers predict rapid consolidation at the top and an equally fast growth at the bottom in the mid-term. The consolidation phase has already started with IBM buying out Daksh and Citicorp planning to convert e-serve into its wholly owned subsidiary.