Tata Consultancy Services Limited - Revenue Analysis & Operating Metrics 2007-2011

TCS Financial Performance – 2007-2011

Financial Performance:

• TCS saw strong revenue growth in FY 2011 (29% YoY) compared to FY 2010 (5.4% YoY) and FY 2009 (6.8% YoY). 
• Revenue growth in FY 2010 and 2009 affected by the global financial crisis and TCS through its strategy of improving efficiency and constant cost base kept up the profitability and delivered good results. 
• Due to the volatile economic environment that originated from the 2008 Global financial crisis TCS was forced to control its expenses by reducing costs on travel, communications, rationalizing infrastructure and optimizing resources which was evident in constant operating expenses for FY 2008, 2009 and 2010. 

TCS Geography Mix 2007-2011

Geography Analysis:

• North America continues to be the major market as American companies are the forefront in Outsourcing to India. US has always been the primary market with significant dependence. 
• Europe including Continental Europe is the second largest market but facing problems due to European sovereign debt crisis. UK has seen fall in contribution since 2009 due to weakness in the Telecom sector. 
• TCS is very active in Indian Market. TCS has many Government of India and other projects in India. 
• Latin America is another focus area for the company but the contribution fell in 2011. 
• APAC is also seeing good growth particularly in 2011. Middle East Africa constant contribution. 

TCS Vertical Revenue Mix 2007-2011

Vertical Analysis:

• BFSI is the dominant vertical and TCS strengthened its position in this vertical. 
• Telecom is the second vertical where TCS is very active and this vertical revenues has fallen down since 2009 as there is weakness in the Telecom sector. 
• Retail & Distribution is the third largest vertical and it has gained significantly since 2009. Hi-tech vertical revenue contribution also started in 2009. 
• Life Sciences is one vertical where TCS is constantly improving and since 2009 started to wil significant deals in Media and Entertainment vertical. 
• All the industry verticals are seeing good growth in 2011. 

TCS Services Revenue Mix 2007-2011

Services Segment Analysis:

• Application Development and Maintenance is the dominant service offering. 
• BPO services have started picking up since FY 2008-2009 with Citi Bank Captive acquisition. 
• Infrastructure services category saw slight growth and constant Engineering and Industrial services revenues. 
• Falling revenues in Enterprise Solutions. Assurance Services seeing some growth. 
• Global Consulting revenues are not seeing growth along with Asset leverage solutions. 

TCS Contract Type 2007-2011

Time & Material contracts are the most preferred. But the Fixed price contracts are also seeing growth since 2010.

TCS Onsite/Offshore Mix 2007-2011

Initially it was Onsite but due to recession and Financial crisis, Offshore was preferred by clients since 2009. TCS also serves clients through its Global Development center .

Source: Company Investors Site             Website: www.tcs.com/investors