How a midcap IT firm rewired itself for AI — and the lessons therein

On a Friday afternoon in March 2026, at Happiest Minds Technologies’ delivery floor, an engineer pulled up a screen to show his manager something unusual. He wasn’t writing code. Instead, he was watching — supervising, really — ten digital workers he had set in motion, each one handling a piece of a chatbot being built in real time. The engineer was the lead. The agents were doing the work.”He has ten digital workers creating a chatbot,” said Preeti Menon, Chief Operating Officer for the PDES Business Unit at the ₹5700-crore software firm, who witnessed the demo. For her, it wasn’t just a proof of concept. It was a glimpse of where the entire software engineering model at the Bengaluru-based company is heading, and what 18 months of quietly, methodically rebuilding the way a mid-cap IT firm operates looks like when it finally starts to show.In March 2026, the Bengaluru-basedcompany revised its FY27 revenue growth guidance upward to 12.5% from an earlier 10% target, with AI-led services, including data engineering, expected to contribute approximately 25% of revenue. According to CEO Joseph Anantharaju, the company’s dedicated generative AI unit, Generative AI Business Services (GBS), contributed $2.63 million in the December quarter alone, against a full-year FY26 target of $5 million. He expects the figure to hit $12 million in FY27.The stock market noticed. Shares rose over 30% following the company’s guidance update, before paring some of those gains. Whether the re-rating reflects genuine execution or is running ahead of it is a question analysts are still working through.What is verifiable is the deal flow. During the December quarter, the company closed a $3 million AI-led engagement with a management institute in Southeast Asia and a three-year, $12 million contract using AI to transform customer support. 32 generative and agentic AI use cases have moved beyond the prototype stage, with many scaling into full projects.Sushovon Nayak, IT Research Analyst at Anand Rathi Institutional Equities, notes that Happiest Minds’ GBS unit has grown faster than many of its larger peers. However, his optimism is hedged.”The ones that have been successfully deploying where they’re able to generate commercial revenue out of it — those are the ones that matter,” he said, placing the bar squarely on sustained commercial scale rather than pipeline announcements.Where it all beganThe first dedicated Data and AI Centre of Excellence (CoE), working on classical machine learning problems such as demand forecasting, marketing analytics, and anomaly detection, was set up in 2013, long before generative AI became part of dinner-table conversations.Then, in late 2022, OpenAI’s large language models changed the equation. For Ritesh Gupta, the company’s CTO, who has been with Happiest Minds since inception, the moment was unambiguous. It was “a rush,” he said of the eighteen months that followed. Large languagemodels (LLMs)had done what classical AI never could — solved natural language processing at scale, and the company had to decide fast how to respond.The answer was structural. Rather than fold generative AI into the existing CoE, Happiest Minds created GBS, a standalone business unit. “Right off the bat, we allocated 100 people and put in solid senior leadership for the generative AI business unit,” CEO Joseph Anantharaju said. Eighteen months later, the GBS unit, combined with the AI CoE, counted 650-700 people at the end of December 2025 and is expected to reach 1,000 by the end of FY27.