Overview : Growth Interrupted



There were three major headlines in 2007-08. The continuing shadow-boxing
between the Congress and the Left (to be nuclear or not to be), the IPL-ICL
fracas, and the fluctuating dollar-rupee relationship and its impact on
export-oriented businesses, particularly the IT exporters.

The Indian IT services vendors, people who actually defined the offshore
exports paradigm, seemed to be the worse affected; the dollar depreciation and
ironically its subsequent appreciation (in cases where many hedged aggressively)
affected most of them including the Big Five.

Some statistics in the DQTop200 illustrate their predicament. With half of
the Top 20 constituted by export-oriented companies, the growth rate of this
exclusive club came down to 24% in FY 08 (from 41% in 07). The fortunes of the
Top 20 exporters in DQ 200 make the picture more precise. While these companies
had grown by 45% in 07, the corresponding growth figure dwindled down to only
29% in 08.With ninety-five of the DQ 200 being services companies (most of them
involved in exports), the impact of the dollar-rupee fluctuation has been the
over-riding theme in the DQ Top 20 this year. Interestingly, what this also did
was ensure that most of these companies had to seriously foray into the domestic
Indian marketit was no more a question of adding one more geography, but more
of business laissez-faire. Many associated the relatively insipid year for even
a giant like Infosys to their failure to start domestic ventures.


The Top 20 Club 2007-08
RANK
06-07
RANK
07-08
COMPANY CEO/COUNTRY HEAD Revenue (Rs crore) Growth (%)
06-07 07-08 06-07 07-08
1 1 TCS S Ramadorai 17,560 21,465 34 22
2 2 Wipro Suresh Vaswani/Girish Paranjpe 13,252 16,884 41 27
3 3 Infosys Technologies S Gopalakrishnan 13,240 15,758 45 19
4 4 Hewlett-Packard India Neelam Dhawan 11,917 15,454 37 30
5 5 IBM India Shanker Annaswamy 8,245 10,179 52 23
6 6 Ingram Micro K Jaishankar 6,896 8,620 25 25
7 7 Satyam Computer Services Ramalinga Raju
6,111
7,889 34 29
11 8 Cognizant Technology Solutions Francisco D Souza 4,584 6,310 83 38
8 9 Redington India PS Neogi/EH Kasturi Rangan 5,023 6,280 23 25
9 10 HCL Technologies Vineet Nayar 4,930 6,200 39 26
12 11 Cisco Systems Naresh Wadhwa 4,424 5,837 30 32
10 12 Oracle India Krishan Dhawan 4,753 5,808 52 22
15 13 HCL Infosystems Ajai Chowdhry 3,522 5,058 32 44
14 14 Intel Praveen Vishaknantaiah 3,760 4,310 14 15
NEW 15 Accenture Harsh Mangalik NEW 3,800 NEW NEW
16 16 Tech Mahindra Vineet Nayar 2,900 3,636 133 25
18 17 Microsoft India Ravi Venkatesan 2,580 3,263 26 26
24 18 SAP India Ranjan Das 1,774 3,260 33 84
21 19 Dell India Sameer Garde 2,000 3,200 66 60
19 20 Lenovo India Amar Babu 2,562 3,014 35 18
Two IT services companies Teledata, which had
moved up several ranks in the 2006-07 after its acquisition of eSys, and
Patni Computer are no more among Indias Top 20 IT companies. Also, Moser
Baer, the global media giant, is not among the largest 20 IT companies
anymore. These displaced companies have been replaced by Accenture, an IT
services player, and SAP which is into package software, and PC biggie Dell.

Moser Baer, last
years #20 clocked Rs 2,074 crore in revenue, while this years #20 Lenovo,
reached the Rs 3,014 crore mark

The hit taken by exports vendors have been somewhat offset by the performance
of the vendors primarily operating in the domestic market. This trend has been
increasingly visible for the last few years, and this year it somewhat acted as
a balm for the DQ 200. Unfortunately, here too, the growth has not been secular
at all. That explains why despite companies like SAP and Acer registering triple
digit growths, the Top 20 domestic players grew by only 27% (down from 31% in
07).

Ibrahim Ahmad & Team DQ
maildqindia@cybermedia.co.in

See Ranking List



Interestingly, three Indian companies make
place for three MNCs in this years Top 20 club. Another case of
globalization
A look at the Top 200 Indian
IT companies reveals that 95 of them are IT services companies and 20 offer
packaged software. Both together add up to 57.5%, up from the 53% last year.
There were 26 companies in the distribution business, and 45 were into
hardware and networking products. The interesting thing is that out of the
Top 200 of India, only 5 companies including Wipro, HP, IBM, and Sun, had
positioned themselves as players which dealt in multiple activities
including hardware, software and services
Fourteen companies registered triple digit
growth, five of them growing more than 200%. This growth was secular too as
it spread across types of companiesfinancial services, entertainment and
hardware.
In the DQ Next30,
the last company Rolta clocked Rs 954 crore where as FY 07 #50 clocked Rs
700 crore



Though the domestic story was better than
the exports, it wasnt much to write home about. Compared to a 31% growth in
FY 07, last fiscal saw it come down to 27%
In the DQ 200 we
had 10 foreign CEOs, and only 2 women. While globalization is on, gender
equality still looks like a mirage
Oil companies were not the only ones to be
impacted by the dollar depreciation. Compared to the 45% growth in FY 07,
the top exporters in the DQ 200 could garner only 30% growth last fiscal.
The credit for that goes largely to Financial Technologies which grew a
stupendous 673%
Financial
Technologies recorded the maximum growth of 673%; with its revenue jumping
to Rs 1,253 crore from Rs 162 crore. Bartronics recorded the second highest
growth (321%) in DQ 200; its revenue touched Rs 270 crore from Rs 64 crore




The principles we have followed
n All
the company revenues are from April 2007 to March 2008. Though different
companies have different financial years, we have taken April-March revenue
for each company.

n
 All revenues of services companies do
not include their BPO revenues. BPO companiesboth pure-play as well as the
BPO operations of multi-services firmsare covered separately in DQ Top 20
Vol III

n
 However, we have included BPO
manpower in total number of employees
n For
companies headquartered in India, we have take the entire IT revenue; for
companies that do business in India, we have taken the entire India IT
revenue; for non-Indian companies who export out of India, we have taken
only the revenue generated by the Indian legal entity. That holds true for
captive units as well.

n
 In case of companies, who have not
provided us with revenues, we have done our own estimates. For domestic
business, we have used sources like distributors, channel partners, SIs,
customers and competitors to get unit shipments and average selling value to
estimate the revenue. For export services, we have based it on average
headcount and average salary, taking into accounts factors such as the type
of work and type of services to calculate total revenue.

n
 In case of non-Indian companies that
have their development/delivery centers, we have added their India sales
revenue to the export revenue and present the total figure.
Disclaimer:
While we have taken utmost care to stick to these
principles, there may be instances, especially with very small companies,
where we may not have succeeded in following these principlessay being able
to deduct BPO revenuecompletely.



NEW FACES

Suresh Vaswani,
joint CEO, Wipro
Girish Paranjpe,
joint CEO, Wipro
Neelam Dhawan, MD, HP India Vineet Nayar, CEO, HCL Tech Harsh Manglik, chairman & MD,
Accenture
Ranjan Das president & CEO
SAP India

 

Praveen Vishakantaiah,
president, Intel India
Sameer Garde, country GM,Dell India Amar Babu, MD, Lenovo India Jeya Kumar, CEO
MphasiS
Ratul Puri, CEO, Moser Baer Pramod Bhasin, president & CEO,
Genpact

 

Jignesh Shah,
MD, Financial Technologies India
Akash Deep Sharma, head of
Operations/COO,
eSys Information Technologies
Anurag Jain, regional managing
director, Perot Systems
Sanjay Dhawan, President, Aricent Hitesh Lokhandawala, CEO, Nortel
Networks India
Sanjeev Sinha, MD, Siemens
Information Systems

 

PR Chandr-ashekhar, VP & CEO,
Hexaware Technologies
George Van Der Merwe, COO, SES
Technologies
Jangoo Dalal, Managing Director &
CEO, D-Link India
L Madhu, APSIS technologies, CEO

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