Group Intro: The Combined

Indias diversity manifests itself in strange ways. It is not just in
ethnicity, religion, and languages. It is not just in the contrasts of having
one of the highest percentage of people who are below the poverty line and one
of the highest number of billionaires.

Even in this small group of groups, the diversity and contrasts are evident.
While you have large manufacturing and engineering companies whose IT businesses
have become significant, you also see first generation companies. And forget
not, there is the worlds largest IT company itself. Even within it, you have
HCL which has taken one extreme approach of actually growing two large
companiesboth Top 20 companiesto tap the India and overseas markets. There is
Wipro, which does not only combine geographies and types of IT offerings, it
even clubs consumer care and lighting business as part of the same corporate
entity. We do not include those revenues in any of our rankings, however.

Many have asked us in the past why we do such an exercise. And, increasingly
over the years, answers are becoming clearer and clearer. While two of the
groupsWipro and HPare still not groups in the traditional sense of the word,
the rest three are finally leveraging their strengths as groups. For HCL,
probably, it is easier to do. But, Tata and Mahindra are increasingly aligning
not just their IT businesses, but their traditional businesses with IT as well.
On the other hand, HCL is promoting its brand as a combined HCL brand.

The Groups and Performance

This year, we decided to include Mahindra Groupthe second diversified
groupin our list. While the revenue at just about a billion USD is far less
than the #4, HP, the addition of Mahindra Satyams revenue could take up the
revenues significantly. Other than Mahindra, there is no change in the list.

The combined revenue of the five groups reached $21.5 bn, up by 5% from last
years combined revenue of $20.5 bn. The growth in rupee terms looks a little
better at 8%. Tata Group still accounts for a major part of the total group
revenue.

Interestingly, many other family-owned groups with traditional businesses are
increasingly focusing on this space. While many of them have already debuted on
the telecom front, in IT too, there are a few that are worth watching. Aditya
Birla is one such group. It has consolidated its technology business under the
Aditya Birla Minacs brand by merging PSI Data Systems into it and rebranding it
as Aditya Birla Minacs IT Services. Both are profiled in our second issue.
Hinduja is already an established player in BPO with its Hinduja Global
Solutions and is now seriously getting into the engineering services space
through its Defiance Technologies (earlier Ashley Design). Mahindra Group itself
may do some sort of restructuring once the Satyam integration is over.
Bristlecone, which is a major player in the supply chain solutions, has already
been integrated with Tech Mahindra.

Hopefully, we will have far more interesting things to write in the coming
years as far as groups are concerned.

Team DQ

maildqindia@cybermedia.co.in