India’s leading software services exporter Tata Consultancy Services announced a $2.2 billion (Rs 11,000 crore) order on Wednesday, its second-largest ever, and said its overall business pipeline continues to be positive despite a tough economic environment.
The order from UK-based pension provider Friends Life, a unit of insurer Resolution, comes as TCS defends its position at the head of India’s $76 billion flagship IT industry from stiff competition and a gloomy economic outlook.
“We are interested in taking the platform to other markets,” said TCS chief executive officer NChandrasekaran, referring to expanding the pension and insurance administration model to geographical markets outside of Europe.
“We are in preliminary discussions with a few other clients.”
News of the 15-year order, second only to TCS’ $2.5 billion agreement with Citigroup, sent the firm’s shares up as much as 3.5%.
TCS and local rivals Infosys and Wipro provide a host of IT services to Fortune 500 firms, but face stiff competition from global players, including IBM and Accenture, for large outsourcing deals.
“Our overall pipeline continues to be good,” said Chandrasekaran, adding that demand from financial services clients was healthy. “But the macroeconomic conditions are tough, the nervousness is still there.”
Revenue from the order will start to appear on the company’s books within the current quarter to end-December, Chandrasekaran said.
TCS, a unit of the salt-to-steel Tata Group conglomerate, boasts of major clients, including General Electric, British Airways and Sony.
The company said last month it does not expect to increase its prices in the near term due to global economic uncertainty, as it reported net profit for the quarter to end-September that slightly lagged estimates.
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