Tata Consultancy Services (BOM:532540)

QUOTE AND NEWS
The Economic Times  May 25  Comment 
Through this partnership, Nexperia aims to enhance TCS' digital core through its end-to-end enterprise application stack hosted on the TCS Cloud.
The Economic Times  May 25  Comment 
Buy Tata Consultancy Services Ltd. at a price target of Rs 2645.0 and a stop loss at Rs 2507.0 from entry point
Clusterstock  May 24  Comment 
The Container Store Group's stock surged 37% to $5.67 a share after the company reported fourth-quarter results that beat analysts' expectations and announced a restructuring plan. Net sales for the period were $221 million, exceeding consensus...
The Hindu Business Line  May 24  Comment 
In an effort to offer technologies in IoT, mobility and Artificial Intelligence (AI), Panasonic India has announced their first India Innovation Centre in collaboration with TCS. The CoE intends t...
The Hindu Business Line  May 22  Comment 
In an effort to offer technologies in Internet of Things, mobility and Artificial Intelligence, Panasonic India has announced its first India Innovation Centre, in collaboration with TCS. The centre ...
The Hindu Business Line  May 22  Comment 
TCS on Monday said it has created a solution that will cut payback on expensive LED lights by half. The software cuts energy consumption using self-learning algorithms and will reduce the typical ...
The Hindu Business Line  May 21  Comment 
The combined market valuation of six of the top-10 most-valued firms surged Rs 61,386.30 crore last week, with TCS being the top gainer. While TCS, HDFC Bank, ITC, SBI, HUL and IOC witnessed a rise...
The Hindu Business Line  May 18  Comment 
Tata Consultancy Services’ buyback offer at ₹2,850 a share got tepid response on Day 1. The company saw demand for only 23,702 shares on the BSE out of 5.6 crore equity shares offered to be bought ...
The Economic Times  May 18  Comment 
The facility will focus on open innovation in the consumer electronic space and leverage the technology already available with Panasonic India.




 

Tata Consultancy Service (BOM:TCS) is an Indian software services and consulting company. It is one of India's oldest and largest providers of information technology and business process outsourcing services. As of 2007, it is Asia's largest information technology firm. TCS, a part of the Tata group, provides information technology and management consultation services to organizations in more than 53 countries. The company offers e-business, application development and maintenance, architecture and technology consulting, engineering, security, infrastructure development and management and quality consulting services.

In addition, TCS offers software packages for electronic banking, insurance billing, customer relationship management, and hospital management. It caters to finance and banking, insurance, telecommunication, transportation, retail, manufacturing, pharmaceutical, energy and utility industries. The company generates around 19% of its revenues from the manufacturing industry, and 6% of its revenues from its engineering and industrial services (EIS) business.

The company was founded in the year 1968 and is based in Mumbai. It has over 89,000 trained IT consultants in 47 countries.

Company Overview

History

Tata Consultancy Services was established in the year 1968. It began as the "Tata Computer Centre", a division of the Tata Group, whose main business was to provide computer services to other group companies. However, the potential of computerization and computer services was realized early on, and an electrical engineer from the Tata Electric Companies, Fakir Chand Kohli, was brought in as the first General Manager. Soon after, the company was named Tata Consultancy Services.

TCS's first software export project was undertaken in 1974 when it converted the Hospital Information System from Burroughs Medium Systems COBOL to Burroughs Small Systems COBOL. This project was carried out entirely in TCS Mumbai on the ICL 1903 Computer. In 1980, TCS and a sister Tata firm accounted for 63% of the Indian software industry exports, $4 million shared by 21 firms. In 1984, TCS set up an office in the Santacruz Electronics Export Processing Zone (SEEPZ) – Mumbai.

The early 1990s saw a tremendous surge in TCS's business, which also resulted in a massive recruitment drive by the company. In early and mid-1990s, TCS re-invented itself to become a software products company. In the late 1990s, to accelerate its revenue growth, TCS decided to employ a three-pronged strategy – developing new products with high revenue earning potential, tapping domestic and other fast growing markets and focusing on inorganic growth through mergers & acquisitions. In late 1998, the company decided to concentrate on new revenue opportunities including Y2K and Euro conversion. E-business was a major area of focus in the late 1990s.

In 1999, TCS started an annual IT Quiz called TCS IT WIZ in India. It has been a great success and a matter of craze among young students inclined towards IT.[1]

In 2004, TCS became a publicly listed company.

In 2008 Tata Consultancy Services was involved in a variety of industries. Some of these included telecom, government, insurance, manufacturing, high tech, and banking and financial services. They offer product life cycle management and systems integration to their customers.

Services

Tata Consultancy Services offers the following services to its customers:

  • IT Solutions and Services (74.9% of net sales): This segment develops IT products for and offers IT services to customers. Some of these IT products include software applications and systems for performance management, customer relationship management and supply chain management. Some of the company's IT services include software application management, system integration, data mining and data quality management.
  • Business Process Outsourcing (11.3% of net sales): This segment helps customers automate and complete specific non-core business tasks. Some of these non-core business tasks include payroll, finance and accounting, and human resources.
  • Engineering and Industrial Services (5.4% of net sales): This segment helps customers engineer and manage products, design and automate plants, and source for and manufacture components.
  • IT Infrastructure Services (6.5% of net sales): This segment builds and maintains IT infrastructure for customers.
  • Asset Based Offerings (3.6% of net sales): This segment develops IT products for and offers IT services to customers that operate specifically in the banking, financial services and insurance industries.
  • Global Consulting (3.4% of net sales): This segment advises customers on management and IT issues.

Industries

Tata Consultancy Services sells to companies in the following industries:

  • Banking, Financial Services and Insurance (Rs. 10,091 crore or 44.1% of net sales)
  • Retail and Distribution (Rs. 1,476 crore or 6.5% of net sales)
  • Others (Rs. 5,360 crore or 23.4% of net sales): Industries that fall under this category include Transportation, Life Sciences and Health Care, Energy and Utilities, Media and Entertainment, Travel and Hospitality, Government etc.

Trends and Forces

Tata Consultancy Reaps The Benefits From Outsourcing

For most US companies, the most expensive part of running a business is employing people. These companies have to deal with workers unions, minimum salary laws, overtime, etc, all of which increase costs and decrease profits. That is why when companies have the opportunity to hire cheaper labor, they pounce on the opportunity. When US companies go to India to look for cheap labor, Tata Consultancy benefits as it helps provide the solutions that companies are looking for. Additionally, because Tata is primarily an IT service provider, the company can reach out to companies in almost every industry. The more companies that look to outsource their labor, the more business Tata is getting, which helps the company's bottom line.

Tata Is Susceptible To Global Economic Conditions

Because Tata is an IT service provider, the company relies on the growth and expansion of other businesses for revenue. During tough economic times, businesses consolidate and thus the demand for Tata's services declines, hurting the company's bottom line.

Competition

Domestic competitors include:

Overseas Competitors:

References

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