SoftBank Expands AI-Focused Investments in India's BPO Sector

After backing a series of Indian start-ups, SoftBank is now looking to deepen its presence in India by scouting buyout opportunities, specifically targeting the AI-led IT and BPO operations. This marks a significant shift in the company’s role – from being a traditional growth and late-stage tech investor to becoming a direct buyer of companies.

According to a report by The Economic Times, the Masayoshi Son-led Japanese investment company had entered discussions to acquire BPO firm AGS Health in a deal estimated at $1 billion. However, the talks fell through, with global investment giant Blackstone eventually emerging as the frontrunner.

SoftBank also held talks with other outsourcing players like WNS Global as it explores ways to integrate artificial intelligence with large-scale service delivery – either through acquisitions or strategic alliances.

It is pertinent to note that SoftBank is eager to accelerate AI adoption in India’s outsourcing industry as the country currently lacks homegrown foundational AI models like OpenAI or Anthropic.

SoftBank's Financial Performance

SoftBank Group reported a net profit of ¥517 billion (approximately $3.5 billion) in the fiscal Q4 (January–March 2025). This marked a significant increase from the ¥231 billion profit recorded in the same quarter the previous year. The result defied expectations, as Reuters reported five analyst estimates compiled by LSEG had forecast a ¥26.9 billion net loss.

The profits were driven by robust performance in SoftBank’s telecommunications holdings, particularly T-Mobile US, and a ¥940 billion ($6.1 billion) gain at Vision Fund 1.

Vision Fund 2's Challenges

On the other hand, Vision Fund 2 recorded a ¥526 billion loss for FY25. The SoftBank Vision Fund, founded in 2017, is a venture-capital fund managed by SoftBank Investment Advisers, a subsidiary of SoftBank Group. With over $100 billion in capital, it is the world’s largest technology-focused investment fund.

The fund targets high-growth tech companies in sectors such as AI, consumer internet, fintech, robotics, and communications infrastructure, with notable investments in Uber, ByteDance, and Coupang.

SoftBank's Investments in India

Vision Fund 2 backs around nine Indian start-ups, including Swiggy, Ola Electric, Oyo, Paytm, Meesho, Delhivery, Lenskart, Unacademy, and Udaan. The ¥526 billion loss in Vision Fund 2 was primarily driven by significant markdowns in the public-market holdings of Indian start-ups such as Swiggy and Ola Electric, whose share prices fell nearly 40%, resulting in a 21.7% quarter-on-quarter markdown of those assets.

Overall, Vision Fund 2’s fair value dropped 2.7% during Q4, reflecting challenges in both public and private markets. The loss in VF2 offset roughly half of what could have been a profit exceeding ¥1 trillion, highlighting the significant impact of early-stage markdowns on SoftBank Group’s bottom line.

SoftBank's strategy to integrate AI into BPO operations in India signals a broader trend of leveraging advanced technology to enhance service delivery and operational efficiency. As the company continues to explore acquisition opportunities, it aims to position itself as a leader in the AI-driven transformation of the outsourcing industry.