Tata unit eyes huge growth in mainland
Tata Consultancy Services (TCS), India's biggest information-technology outsourcing company, aims to expand its network of 'global delivery centres' on the mainland to meet growing domestic and international demand.
'We're looking to add one or two more [global delivery centres] in the next few years,' TCS chief executive and managing director Natarajan Chandrasekaran said.
Chandrasekaran pioneered the creation of TCS' global network delivery system, with multiple centres and round-the-clock operation, across five continents.
The model allows large corporate customers to choose a software outsourcing strategy that best suits their needs and business location. TCS says this set-up guarantees delivery of custom, quality software faster and in compliance with regulatory requirements and cultural preferences.
'In mainland China, we're present in five different locations with reasonable scale,' Chandrasekaran said. 'We have centres in Hangzhou, Beijing, Shanghai, Tianjin and Shenzhen.'
Potential locations for the global delivery centres included Chengdu, Dalian and Chongqing.
Chandrasekaran said TCS, a unit of Indian conglomerate Tata Group, was 'growing nicely [on the mainland], but we need to move faster'. He declined to provide a breakdown of TCS' annual revenues on the mainland, where the software-outsourcing firm has been operating for 10 years.
Mumbai-based TCS reported in January a net profit of 28.87 billion rupees, (HK$4.26 billion) up 23 per cent from a year ago, in its third quarter to December. It had 226,751 employees worldwide at the end of December.
Chandrasekaran said growth had been broad-based for TCS, with the company's business in the Asia-Pacific region rising 15.7 per cent from the previous quarter.
TCS last month marked 25 years of operations in Hong Kong.
'Mainland China has the potential to be our fastest-growing market in the region, but we need to have more scale and build relationships with customers. It takes time,' Chandrasekaran said. 'We're investing to build our presence and capability.'
The TCS chief executive said 'a meaningful presence' on the vast market would entail having at least 10,000 staff. The firm has less than 2,500 employees at present, but plans to grow to 5,000 by 2014.
The Ministry of Industry and Information Technology (MIIT) in February announced that total revenue of the mainland's software and information-technology outsourcing industry reached 383.5 billion yuan last year, a 39.5 per cent increase from 2010, due to greater domestic and international demand.
MIIT data also showed that there were 7,080 companies in the industry, with about 990,000 employees.
Chandrasekaran said TCS was open to making acquisitions to help expand its business, but there was no plan to pursue that option on the mainland. He said he expected TCS to continue building its domestic operations by signing up large mainland and international clients in the financial services, manufacturing and retail sectors.
In one of its most high-profile mainland deals, in 2007 TCS won a US$100 million contract to revamp the core IT system of the Bank of China. It is the country's oldest bank and second-largest lender.
TCS is one of 10 Tata-affiliated companies with operations on the mainland.
