Tata Consultancy Services (BOM:532540)

QUOTE AND NEWS
The Economic Times  Sep 21  Comment 
Within TCS, a major chunk, over 40 % of its women employees are either new recruits or at junior levels, while about 11% are in the senior management.
The Economic Times  Sep 20  Comment 
"We have a great opportunity, we have a great position and we should be able to leverage that and in fact lead in this whole digital revolution."
The Economic Times  Sep 19  Comment 
Among blue-chips, TCS's stock gained 2.71 per cent to Rs 2,708.05, while Tata Steel rose by 0.72 per cent to Rs 510.40.
The Economic Times  Sep 19  Comment 
"TCS is a 'BUY' call with a target of Rs 2750 and a stop loss of Rs 2675."
Reuters  Sep 19  Comment 
The Nifty rose for a third consecutive session on Friday, hitting its highest in about 1-1/2 weeks, as cash-rich exporters such as Tata Consultancy Services surged on hopes of being better placed to weather any Fed-related volatility.
The Economic Times  Sep 19  Comment 
TCS was trading 2.6 per cent higher at Rs 2711. It hit a low of Rs 2642 and a 52-week high of Rs 2713 in trade today on the NSE.
The Economic Times  Sep 19  Comment 
Nifty index also started on a strong note and was trading above its crucial psychological level of 8100, supported by gains in pharma, power, realty, capital goods and IT stocks.
The Hindu Business Line  Sep 18  Comment 
Moody’s has upgraded the ratings for many Tata Group companies including Tata Motors, Tata Steels and TCS reflecting systemic and financial support from group holding company Tata Sons and close a...
The Economic Times  Sep 18  Comment 
'We believe that some of the frontline companies will continue to provide you good opportunity, be it TCS, Infosys, HCL Tech or even in the midcap space.'
The Economic Times  Sep 18  Comment 
'Our digital business is definitely growing faster than the rest of the company. It will generate at least $5 billion revenues in 4-5 years.'




 

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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