Somewhat true but not necessarily. I've worked for
SEO companies that really don't do much in terms of optimising their own sites, but they certainly could rank if they wanted to.
You have to remember that different things work for different people and niches. Ironically for a lot of
SEO companies having a sales team, networking in the local community, paid advertising, having a proactive email marketing strategy, etc, is more effective and profitable than ranking for certain search queries. I know it sounds counter-intuitive but it's true.
I've had this argument with people before who've turned around and said "Well I've just Google'd X and I don't see your company website there" as if they've rumbled the company in question as unable to do their job, but if we're not ranking for X it's because it's a waste of our time.
Also I think
SEO taken by itself is oldhat. A lot of reputable
SEO companies have abandoned the term and are all now "digital marketing" companies, with much more of a focus on engaging content, social channels, on-page optimisation, branding, etc. On-page optimisation and links are still very important but I'd run the other way if a company came to me talking only about those things.
But yeah, generally stay away from Indian companies because their methods are outdated by in large and will upset Google if anything.