TCS, Satyam, Wipro betting big on Indian services market

IT companyWith the Indian economy growing at a healthy rate and change in rupee-dollar equation, domestic IT behemoths like TCS, Infosys, Wipro and Satyam who till recently favored the greenback market are now looking at opportunities in their own backyard.

The Indian vendors are now eyeing the opportunities in the Indian services market as they intend to garner a larger share of the market which is dominated by the global players like IBM and HP.

Analysts feels that with the slowdown in Western markets, the dollar’s weakness against the rupee and the uncertainties arising from the slowdown of the US economy, the Indian IT vendors are re-thinking their strategy and exploring the non-US markets including India.

However, TCS, Satyam and Wipro feels that it’s not the slowdown but the increased spending on IT by the government and the corporates is fuelling the growth of this sector and attracting the IT vendors to explore the market.

“The rapid economic growth and the growing stature of Indian corporates, who are adopting IT on a much wider scale, now presents a huge opportunity for IT services companies,” Wipro Infotech Chief Executive Anand Sankaran said.

Moreover, the size of the IT deals in the country is also increasing, which is making this sector attractive and profitable at the same time.

Earlier, the average size of deals in India were 2-3 million dollars and now multi-year deals worth 100 million dollars is not unheard in the domestic market,” TCS Vice President Head (India) S Venkatramani told PTI.

“The average size of deals are now 25-30 million dollars,” he added.

TCS which earns 10 per cent of their global revenues from the domestic market has a team of 7,000-9,000 members focused on the Indian market.

TCS has already restructured its India team and has created different verticals such as retail, utilities, telecom which would focus on the respective sectors.

Satyam Computers which is working on various e-governance projects is also planning to increase and strengthen its India team, Satyam India Head Ranjan Tayal said.

Currently, they have less than 100 employees focusing on the Indian market and earns 3-4 per cent of their revenues from the market.

Wipro is also focusing on emerging vertical specific opportunities in Retail, Infrastructure, Defense, Financial Services and Telecom.

“Wipro Infotech will continue to launch new services in India and is focusing on emerging technologies such as Service Oriented Architecture, advanced technologies like Unified Communication, Virtualization and others in the Indian market,” Sankaran said.

Wipro Infotech, accounted for 19 per cent of the Wipro’s revenue in 2007-08.

It grew at a staggering 51 per cent last year with revenues of Rs 3,746 crore of which around 90 per cent is from the domestic market and the balance from ME and APAC.

According to the latest Forrester report data, the Indian IT Market is expected to grow by 18 per cent in the year 2008 to reach 38 billion dollars, clocking second highest growth rate after China (20 per cent growth; to touch $ 138 billion in size).

However, not only the Indian IT firms but also the overseas listed BPOs like EXL and Cognizant are now looking at tapping the domestic market.

EXL is already on a lookout to acquire small and mid-sized BPOs focusing on the domestic sector while Cognizant is targeting existing global clients and large global MNCs who are setting up captives in India.

Courtesy :- Economic Times

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