• TCS is an IT services, consulting and business solutions provider that has been partnering with the world’s largest businesses in their transformation journeys for the last fifty years. TCS offers a consulting led, cognitive powered, integrated portfolio of business, technology and engineering services and solutions. This is delivered through its unique, Location Independent Agile delivery model, a benchmark of excellence in software development.
  • For a business that has navigated technology change over the last five decades, the ups and downs of short term economic cycles become insignificant blips in the broader sweep of history. Your Company has shown itself to be immensely entrepreneurial, agile, adaptive and innovative over the years, and these attributes will continue to serve it well in the years ahead.
  • Your Company crossed two important milestones in FY 2019. Its annual revenue crossed the $20 billion figure, a 20-fold increase over the last 16 years. It also became the first Indian company to achieve a market capitalization of $100 billion in the last decade, and join the list of the Top 100 most valuable companies in the world.
  • We continued to see strong revenue growth in our Energy and Utilities vertical which grew 19.9%, and our Life Sciences and Healthcare vertical which grew 15.3%. Our remaining three verticals — Communications and Media, Manufacturing, and Technology and Services – grew 9.6%, 7.5%, and 6.1% respectively.
  • Adoption of digital technologies such as cloud, mobile, IoT, analytics, machine learning, AI and automation has reached the inflexion point and is triggering large re-architecture programs. It is safe to say that this technology stack is now mainstream – and in fact, the default stack for all new investments today, obviating the need to specify that it is digital.
  • Second, enterprises are reimagining multiple aspects of their business model, investing in technology-led product or service innovation, customer analytics and insights, and core transformation programs. These are large, multi-year engagements, large in scale and scope, and we are winning such deals by leveraging our thought leadership, our contextual knowledge, intellectual property and our ability to stitch together different capabilities from across TCS.
  • Better revenue growth, higher quality of new revenues, and greater scale in digital are our biggest margin levers. Our innovation and transformational work is a higher value business, with better realizations that translate into price stability and margin resilience. Second, we have been investing heavily in organic talent development, localization, IP development and workplace transformation over the last several years. That is already baked into our margins. We are now reaping the benefits of those investments. It is not as if we have to start investing in these things today.
  • In FY 2019, the global market for software and services is estimated to have grown to $1.4 trillion. IT Services is estimated to have grown by 3.2% YoY, driven by strong growth in digital engagements, particularly cloud adoption. Business Process Management grew by 4.5% over the prior year, on account of greater focus on automation, while packaged software grew 7.4% YoY, driven by rapid adoption of SaaS, and security and privacy solutions.
  • TCS has historically grown much faster than the market. In the latest five-year period, while the market for IT-BPM services expanded by a CAGR of 2% (IT Services CAGR: 1.5%), TCS had a CAGR of 9.2% in USD terms. One reason for the outperformance is market share gains on account of superior capabilities, and higher customer satisfaction. The second reason has been greater participation in our customers’ growth and transformation initiatives, which represent the expanding part of their technology spending.
  • On a reported basis, TCS’ revenue grew 19% in FY 2019, compared to 4.4% in the prior year. This was largely an outcome of greater demand for our services and solutions during the year, driven by expanding participation in our customers’ growth and transformation initiatives. In addition, there was some benefit from the movement in currency exchange rates. FY 2019 saw volatility in USD-INR, ranging from Rs. 64.90 and Rs. 74.10, and averaging at Rs. 70.07. There was also significant volatility in exchange rates of emerging markets’ currencies.
  • TCS has successfully navigated through multiple technology cycles over the last five decades, pivoting and adapting each time to build relevant new capabilities through organic talent development and helping our clients realize the benefits of emerging technologies. Our responsiveness, agility and adaptability to change have been core to our longevity.
  • In FY 2019, in addition to supporting ongoing investments, TCS launched several new digital solutions targeting industry-specific use cases, made two targeted acquisitions – of W12 Studios and BridgePoint, and set up the inaugural TCS Pace Port™ in Tokyo to serve as an innovation hub which customers can readily leverage to operationalize all four phases of their innovation journeys viz. discovery, definition, refinement, and delivery.

 

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