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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