Results for Quarter IV FY 2005-06 - Tata Consultancy Services

© Tata Consultancy Services Ltd. May 2006 1

0.69 0.881.04

1.56

2.24

2.97

FY 01 FY 02 FY 03 FY 04 FY 05 FY 06

Revenue US $ Billion

Results for Quarter IV FY 2005-06

2

Disclaimer

Certain statements in this release concerning our future growth prospects are forward- looking statements, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, intense competition in IT services including those factors which may affect our cost advantage, wage increases, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed- price, fixed-time frame contracts, client concentration, restrictions on immigration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which TCS has made strategic investments, withdrawal of governmental fiscal incentives, political instability, legal restrictions on raising capital or acquiring companies outside India, and unauthorized use of our intellectual property and general economic conditions affecting our industry. TCS may, from time to time, make additional written and oral forward looking statements, including our reports to shareholders. The Company does not undertake to update any forward-looking statement that may be made from time to time by or on behalf of the company.

3

HighlightsStrong growth in revenues from our international customers and strategic deals has helped us to post a volume-led growth during Q4.

Integrated full services business model achieving success in expanding our share with our customers. 89 of our top 100 customers leveraged one or more services from our growth engines generating over 300+m dollars during FY06.

Integration of Tata Infotech, Comicrom and FNS completed – We have set the stage for achieving accelerated growth through synergies. For example, already a notable BPO win for Comicrom and three major core banking wins for FNS during Q4.

While North America continues to show spirited growth, Europe is clearly emerging as a major growth engine. Latin America and Middle East are vibrant with very strong pipeline.

Global Network Delivery Model initiated in 2002 has gained scale and maturity. Today, we have 3056 (1867 IT Services and 1189 BPO) associates working out of our centresin Latin America, Eastern Europe and China. More than 15 of TCS large customers are leveraging these centres for their regional operations. An additional 10+ customers are doing pilot engagements.

We added a total of 27,377 (net: 21,140) associates during the year.


Financial Performance

5

Indian GAAP Growth Summary – Annual

Consolidated Indian GAAP (Rs. Crores) FY 2006 FY 2005

Income from IT & Consultancy Services 12,397 9,095% Growth Y-o-Y 36.31%

Total Income 13,252 9,748% Growth Y-o-Y 35.94%

PBIDT 3,664 2,814% Growth Y-o-Y 30.22%

Profit After Tax 2,967 1,977% Growth Y-o-Y 50.07%

6

Consolidated Indian GAAP

FY 2006 FY 2005 FY 2006 FY 2005 FY 2006 FY 2005 FY 2006 FY 2005

INCOMEa) IT & Consultancy Services 10,673.22 7,794.41 12,396.84 9,094.64 95.17 97.10 93.55 93.29 b) Manufacturing, Sale of equipment and licences 541.64 233.18 855.31 653.83 4.83 2.90 6.45 6.71 Total Income 11,214.86 8,027.59 13,252.15 9,748.47 100.00 100.00 100.00 100.00

EXPENDITURE a ) Salaries & Wages 4,000.60 1,763.83 4,720.24 2,282.83 35.67 21.97 35.62 23.42 b ) Overseas business expenditure 1,516.19 2,327.59 1,623.90 2,425.56 13.52 28.99 12.25 24.88 c ) Other operating expenses 2,429.80 1,477.12 3,243.89 2,226.25 21.67 18.40 24.48 22.84 Total Expenditure 7,946.59 5,568.54 9,588.03 6,934.64 70.86 69.37 72.35 71.14

Profit Before Interest, Depreciation, Taxes & Other Income 3,268.27 2,459.05 3,664.12 2,813.83 29.14 30.63 27.65 28.86 Provision for additional EVA payout - 102.00 - 102.00 - 1.27 - 1.05 Interest 4.49 10.40 9.14 15.45 0.04 0.13 0.07 0.16 Depreciation 257.38 133.22 282.43 158.82 2.29 1.66 2.13 1.63 PROFIT BEFORE TAXES & OTHER INCOME 3,006.40 2,213.43 3,372.55 2,537.56 26.81 27.57 25.45 26.03

Other Income 67.95 95.22 134.08 96.13 0.61 1.19 1.01 0.99 PROFIT BEFORE TAXES 3,074.35 2,308.65 3,506.63 2,633.69 27.41 28.76 26.46 27.02 PROVISION FOR TAXES

a) Current tax expense 342.66 241.00 502.31 358.57 3.06 3.00 3.79 3.68 b) Deferred tax expense 14.82 39.76 7.26 38.42 0.13 0.50 0.05 0.39

PROFIT AFTER TAXES FROM OPERATIONS 2,716.87 2,027.89 2,997.06 2,236.70 24.23 25.26 22.62 22.94 Minority Interest (29.84) (9.12) - - (0.23) (0.09) Share of profit in respect of investments in Associates (0.47) 0.99 - - (0.00) 0.01 PROFIT BEFORE ONE-OFF ITEMS 2,716.87 2,027.89 2,966.75 2,228.57 24.23 25.26 22.39 22.86 One-off items 196.47 - 251.67 - 2.45 - 2.58

NET PROFIT 2,716.87 1,831.42 2,966.75 1,976.90 24.23 22.81 22.39 20.28

ConsolidatedRs. Crores

TCS Limited Consolidated TCS Limited% of Revenue

Indian GAAP Income Statement - Annual

7

Indian GAAP Growth Summary – QuarterlyQ3 FY06 Q4 FY05

Incl TIL Excl TIL

Income from IT & Consultancy Services 3,472 3,309 2,316

% Growth Q-o-Q 4.93%% Growth Y-o-Y 49.95%

Total Income 3,709 3,486 2,578


PBIDT (before Other Income) 992 966 694


Profit After Tax 832 770 472


Q4 FY06 Consolidated Indian GAAP (Rs. Crores)

8

Indian GAAP Income Statement – Consolidated – Q4 06Consolidated Indian GAAP

Incl TIL Excl TIL Excl TIL Incl TIL Excl TIL Excl TIL

INCOMEa) IT & Consultancy Services 3,472.21 3,309.20 3,147.04 2,315.53 93.61 94.92 95.72 89.80 b) Manufacturing, Sale of equipment and Licences 237.00 177.19 140.81 262.92 6.39 5.08 4.28 10.20 Total Income 3,709.21 3,486.39 3,287.85 2,578.45 100.00 100.00 100.00 100.00

EXPENDITURE a ) Salaries & Wages 1,429.54 1,351.36 1,293.54 643.82 38.54 38.76 39.34 24.97 b ) Overseas business expenditure 310.84 318.32 259.87 633.97 8.38 9.13 7.90 24.59 c) Other operating expenses 976.75 850.97 791.79 606.73 26.33 24.41 24.08 23.53 Total Expenditure 2,717.13 2,520.65 2,345.20 1,884.52 73.25 72.30 71.33 73.09

Profit Before Interest, Depreciation, Addional incentives, Taxes & Other Income 992.08 965.74 942.65 693.93 26.75 27.70 28.67 26.91 Provision for additional EVA payout - - - 102.00 3.96 Interest 2.76 2.32 2.30 2.99 0.07 0.07 0.07 0.12 Depreciation 83.86 74.73 71.15 48.79 2.26 2.14 2.16 1.89 Profit Before Taxes & Other Income 905.46 888.69 869.20 540.15 24.41 25.49 26.44 20.95

Other Income 28.89 19.73 14.69 1.98 0.78 0.57 0.45 0.08 Profit Before Taxes 934.35 908.42 883.89 542.13 25.19 26.06 26.88 21.03 PROVISION FOR TAXES


Profit After Taxes From Operations 841.85 775.41 758.22 460.71 22.70 22.24 23.06 17.87 Minority Interest (9.80) (5.50) (5.51) 11.01 (0.26) (0.16) (0.17) 0.43 Share of profit in respect of investments in Associates 0.07 0.37 0.37 0.07 0.00 0.01 0.01 0.00

Net Profit As Reported 832.12 770.28 753.08 471.79 22.43 22.09 22.90 18.30 Adjustments for EVA - - - (74.98) - - - (2.91) Proforma Adjusted Net Profit 832.12 770.28 753.08 546.77 22.43 22.09 22.90 21.21

Q3 FY 2006 Q4 FY 2005 Q4 FY 2006 Q4 FY 2005% of RevenueQ3 FY 2006

Rs. Crores

Q4 FY 2006

9

Indian GAAP Income Statement – Unconsolidated – Q4 FY06Unconsolidated Indian GAAP


INCOMEa) IT & Consultancy Services 2,926.02 2,828.33 2,645.62 2,046.53 95.36 96.24 97.26 96.44 b) Manufacturing, Sale of equipment and licences 142.37 110.56 74.57 75.59 4.64 3.76 2.74 3.56 Total Income 3,068.39 2,938.89 2,720.19 2,122.12 100.00 100.00 100.00 100.00

EXPENDITURE a ) Salaries & Wages 1,233.21 1,154.95 1,086.86 485.65 40.19 39.30 39.96 22.89 b ) Overseas business expenditure 285.08 289.76 231.46 605.00 9.29 9.86 8.51 28.51 c) Other operating expenses 682.15 630.57 577.13 405.79 22.23 21.46 21.22 19.12

Total Expenditure 2,200.44 2,075.28 1,895.45 1,496.44 71.71 70.61 69.68 70.52 Profit Before Interest, Depreciation, Taxes & Other Income 867.95 863.61 824.74 625.68 28.29 29.39 30.32 29.48 Provision for additional EVA payout - - - 102.00 - - - 4.81 Interest 1.22 1.27 1.24 1.59 0.04 0.04 0.05 0.07 Depreciation 75.41 68.33 63.25 42.64 2.46 2.33 2.33 2.01 Profit Before Taxes & Other Income 791.32 794.01 760.25 479.45 25.79 27.02 27.95 22.59

Other Income 8.79 14.27 7.74 1.16 0.29 0.49 0.28 0.05 Profit Before Taxes 800.11 808.28 767.99 480.61 26.08 27.50 28.23 22.65 PROVISION FOR TAXES


Net Profit As Reported 750.06 709.46 679.65 426.70 24.44 24.14 24.99 20.11 Less Adjustments for EVA (74.98) - - - (3.53) Proforma Adjusted Net Profit 750.06 709.46 679.65 501.68 24.44 24.14 24.99 23.64

Rs. Crores % of RevenueQ3 FY 2006 Q4 FY 2005Q4 FY 2006 Q4 FY 2006 Q3 FY 2006 Q4 FY 2005

10

Indian GAAP Balance Sheet - ConsolidatedConsolidated Indian GAAP

31-Mar-06 31-Mar-05 31-Mar-06 31-Mar-05Source of FundsShareholders' Funds 6,250.95 3,477.54 95.21 90.65 Minority Interest 164.72 89.74 2.51 2.34 Loan Funds 116.69 203.01 1.78 5.29 Deferred Tax Liability 33.07 66.00 0.50 1.72 Total Liabilities 6,565.43 3,836.29 100.00 100.00 Application of FundsFixed Assets (net) 1,998.09 1,138.77 30.43 29.68 Goodwill 733.90 478.89 11.18 12.48 Investments 704.62 422.07 10.73 11.00

Cash and Bank Balance 432.38 274.69 6.59 7.16 Current Assets, Loans and Advances 4,742.43 2,975.41 72.23 77.56 Current Liabilities and Provisions (2,045.99) (1,453.54) (31.16) (37.89)

Net Current Assets 3,128.82 1,796.56 47.66 46.83 Total Assets 6,565.43 3,836.29 100.00 100.00

%Rs Crores

11

US GAAP Growth Summary – Annual

Revenue 132,454 97,272% Growth Y-o-Y 36.17%

Gross Margin 60,839 45,989% Growth Y-o-Y 32.29%

Operating Income 34,137 26,928% Growth Y-o-Y 26.77%

Net Income (before one-off Items) 29,074 22,539% Growth Y-o-Y 28.99%

Net Income 28,831 20,521% Growth Y-o-Y 40.49%

Consolidated US GAAP (Rs Million) FY 2006 FY 2005

US GAAP financial details are based on Audited US GAAP financial statements for FY2005-06

12

Consolidated US GAAP USD MillionFY2006 FY2005 FY2006 FY2005

Revenue 2,968.33 132,454.44 97,272.37 100.00 100.00 Cost of revenue 1,604.92 71,615.56 51,283.24 54.07 52.72

Gross margin 1,363.41 60,838.88 45,989.13 45.93 47.28 SG & A expenses 598.41 26,702.33 19,060.91 20.16 19.60

Operating income 765.01 34,136.55 26,928.21 25.77 27.68 Other income (expense), net 4.26 190.26 756.96 0.14 0.78

Income before income taxes 769.27 34,326.81 27,685.17 25.92 28.46 Income taxes 111.81 4,989.10 4,064.81 3.77 4.18 Equity in net earnings of affiliates 0.35 15.70 18.06 0.01 0.02 Income after income taxes 657.82 29,353.40 23,638.42 22.16 24.30 Minority Interest 6.26 279.41 79.05 0.21 0.08 Net Income after minority interest 651.55 29,074.00 23,559.38 21.95 24.22 Provision for additional EVA payout 1,020.00 - 1.05 Net Income before One-off items 651.55 29,074.00 22,539.38 21.95 23.17 Less: One-off Items 5.45 243.01 2,018.03 0.18 2.07 Net Income after One-off items as reported 646.11 28,830.99 20,521.34 21.77 21.10

USD Rupees RupeesEarnings Per Share 1.32 58.92 43.62

Rs Million % of RevenueUS GAAP Income Statement - Annual

INR numbers of FY2006 are converted to USD on convenience translation basis @ Rupees 44.6225 per USD


13

COR – SG&A Details - AnnualCost of Revenue FY 2006 FY 2005 FY 2006 FY 2005

Employee Cost 55,975.18 40,341.54 42.26 41.47 Equipment & Software 7,389.02 5,591.70 5.58 5.75 Depreciation 1,931.22 1,107.23 1.46 1.14 Travel 2,354.20 1,518.75 1.78 1.56 Communication 1,184.52 808.32 0.89 0.83 Other Costs 2,781.42 1,915.69 2.10 1.97

Cost of Revenue 71,615.56 51,283.24 54.07 52.72

S G & A FY 2006 FY 2005 FY 2006 FY 2005

Employee Cost 13,011.95 9,242.58 9.82 9.50 Bad Debts & Provisions for Doubtful Debts 405.23 414.90 0.31 0.43 Depreciation 878.64 447.89 0.66 0.46 Rent 2,062.72 1,306.41 1.56 1.34 Travel 1,797.90 1,320.75 1.36 1.36 Communication 876.81 635.55 0.66 0.65 Recruitment & Training 793.03 412.01 0.60 0.42 Professional Fees 1,163.66 1,283.10 0.88 1.32 Other Costs 5,299.20 3,672.85 4.00 3.78 Research and development 413.20 324.86 0.31 0.33

S G & A expenses 26,702.33 19,060.91 20.16 19.60

Rs. Millions % of Revenue



14

US GAAP Revenue Growth – QuarterlyQ3 FY06 Q4 FY05

Incl TIL Excl TIL

Revenue from International Business 32,960 30,433 22,454


Revenue from Indian Business 4,273 4,093 3,392


Total Revenue 37,234 34,526 25,846


Consolidated US GAAP (Rs Million) Q4 FY06


15

US GAAP Growth Summary – QuarterlyQ3 FY06 Q4 FY05

Incl TIL Excl TIL

Gross Margin 16,855 15,960 12,163


Operating Income 9,197 9,035 6,809


Net Income 7,958 7,502 4,698


Consolidated US GAAP (Rs Million) Q4 FY06


16

Consolidated US GAAP USD Million


Revenue 834.42 37,233.69 34,525.57 32,644.53 25,845.55 100.00 100.00 100.00 100.00 Cost of revenue 456.70 20,379.07 18,565.56 17,307.50 13,682.40 54.73 53.77 53.02 52.94

Gross margin 377.72 16,854.62 15,960.01 15,337.03 12,163.15 45.27 46.23 46.98 47.06 SG & A expenses 171.61 7,657.56 6,925.11 6,516.29 5,353.88 20.57 20.06 19.96 20.71

Operating income 206.11 9,197.06 9,034.89 8,820.74 6,809.28 24.70 26.17 27.02 26.35 Other income (expense), net (0.89) (39.92) (158.63) (201.56) (413.63) (0.11) (0.46) (0.62) (1.60)

Income before income taxes 205.21 9,157.14 8,876.26 8,619.18 6,395.65 24.59 25.71 26.40 24.75 Income taxes 20.12 897.62 1,320.44 1,255.73 834.43 2.41 3.82 3.85 3.23 Equity in net earnings of affiliates 0.74 33.00 (2.54) 3.71 0.65 0.09 (0.01) 0.01 0.00 Income after income taxes 185.84 8,292.53 7,553.28 7,367.15 5,561.87 22.27 21.88 22.57 21.52 Minority Interest 2.30 102.61 48.26 48.26 (115.33) 0.28 0.14 0.15 (0.45) Net Income after minority interest 183.54 8,189.92 7,505.03 7,318.90 5,677.19 22.00 21.74 22.42 21.97 Provision for additional EVA payout - - - - 1,020.00 - - - 3.95 Net Income before One-off items 183.54 8,189.92 7,505.03 7,318.90 4,657.19 22.00 21.74 22.42 18.02 Less: One-off Items 5.20 232.12 3.05 - (40.53) 0.62 0.01 - (0.16) Net Income after One-off items as reported 178.34 7,957.80 7,501.98 7,318.90 4,697.72 21.37 21.73 22.42 18.18 Less :- Adjustments for EVA - - - - (749.84) - - - (2.90) Proforma adjusted Net Income 178.34 7,957.80 7,501.98 7,318.90 5,447.57 21.37 21.73 22.42 21.08

USD Rupees Rupees Rupees RupeesEarnings Per Share 0.36 16.26 15.33 15.24 9.78

Rs MillionQ3 FY06 Q4 FY05Q4 FY06 Q4 FY06 Q4 FY06 Q3 FY06 Q4 FY05

% of Revenue

US GAAP Income Statement - Quarterly

INR numbers of Q4 FY06 are converted to USD on convenience translation basis @ Rupees 44.6225 per USD


17

COR Incl TIL Excl TIL Excl TIL Incl TIL Excl TIL Excl TIL

Employee Cost 16,356.02 14,884.72 14,119.45 10,621.53 43.93 43.11 43.25 41.10 Equipment & Software 1,866.21 1,487.68 1,243.17 1,588.54 5.01 4.31 3.81 6.15 Depreciation 579.71 506.34 490.28 358.44 1.56 1.47 1.50 1.39 Travel 496.42 648.46 565.48 481.57 1.33 1.88 1.73 1.86 Communication 344.75 306.83 297.56 276.26 0.93 0.89 0.91 1.07 Other Costs 735.95 731.53 591.55 356.06 1.98 2.12 1.81 1.38

Cost of Revenue 20,379.07 18,565.56 17,307.50 13,682.40 54.73 53.77 53.02 52.94

S G & A Incl TIL Excl TIL Excl TIL Incl TIL Excl TIL Excl TIL

Employee Cost 3,484.20 3,310.90 3,143.37 2,343.95 9.36 9.59 9.63 9.07 Bad Debts & Provisions for Doubtful Debts 113.53 97.11 97.53 212.49 0.30 0.28 0.30 0.82 Depreciation 285.05 231.44 210.88 150.71 0.77 0.67 0.65 0.58 Rent 669.11 520.74 507.28 370.34 1.80 1.51 1.55 1.43 Travel 557.73 407.51 342.79 284.13 1.50 1.18 1.05 1.10 Communication 221.53 227.36 213.92 142.90 0.59 0.66 0.66 0.55 Recruitment & Training 232.90 261.13 261.19 119.09 0.63 0.76 0.80 0.46 Professional Fees 389.77 317.79 304.04 526.49 1.05 0.92 0.93 2.04 Other Costs 1,595.68 1,441.27 1,350.42 1,130.90 4.29 4.17 4.14 4.38 Research and development 108.05 109.88 84.87 72.89 0.29 0.32 0.26 0.28

S G & A expenses 7,657.56 6,925.11 6,516.29 5,353.88 20.57 20.06 19.96 20.71

Rs. Millions


Q4 FY06 Q3 FY06 Q4 FY05 Q4 FY06

% of Revenue

Q3 FY06 Q4 FY05 Q4 FY06 Q3 FY06 Q4 FY05 Q4 FY06

Q3 FY06 Q4 FY05

COR – SG&A Details - Quarterly


18

Consolidated US GAAPRs Million % Rs Million %

Source of FundsShareholders Funds 58,407.83 68.21 31,977.31 65.38 Short term borrowings 979.35 1.14 1,927.80 3.94 Current liabilities 22,726.38 26.54 13,196.49 26.98 Minority Interest 1,563.68 1.83 1,322.92 2.70 Other non-current liabilities 1,948.79 2.28 483.51 0.99 Total Liabilities 85,626.04 100.00 48,908.03 100.00 Application of FundsProperty & Equipment 15,071.53 17.60 10,869.54 22.22 Intangible assets and Goodwill 8,692.06 10.15 530.21 1.08 Investments 7,274.09 8.50 4,191.62 8.57 Cash and Cash equivalents 3,965.01 4.63 2,625.89 5.37 Current assets 45,635.23 53.30 27,748.18 56.74 Other Non Current assets 4,988.12 5.83 2,942.59 6.02 Total assets 85,626.04 100.00 48,908.03 100.00

31-March-200531-March-2006

US GAAP Balance Sheet


19

US GAAP ConsolidatedTCS TIL Merged TCS TIL Merged TCS TIL Merged

Revenue 27,094.31 2,104.68 29,128.71 29,513.49 2,204.16 31,566.47 32,644.53 2,157.90 34,525.57

Operating Income 7,423.43 269.84 7,736.04 8,003.83 263.23 8,168.55 8,820.74 293.76 9,034.89 % of Revenue 27.40 12.82 26.56 27.12 11.94 25.88 27.02 13.61 26.17

Income before taxes 7,518.36 311.74 7,872.87 8,091.58 427.47 8,420.54 8,619.18 336.68 8,876.26 % of Revenue 27.75 14.81 27.03 27.42 19.39 26.68 26.40 15.60 25.71

Net Income (before one-off items) 6,186.70 246.15 6,475.63 6,733.73 268.19 6,903.42 7,318.90 265.73 7,505.03 % of Revenue 22.83 11.70 22.23 22.82 12.17 21.87 22.42 12.31 21.74

Net Income 6,186.70 242.23 6,471.71 6,733.73 264.27 6,899.50 7,318.90 262.68 7,501.98 % of Revenue 22.83 11.51 22.22 22.82 11.99 21.86 22.42 12.17 21.73

EPS 12.89 13.23 14.03 14.10 15.24 15.33

Q1 FY2006 Q2 FY2006 Q3 FY2006

Effect of Merger with TIL in Q1, Q2, Q3 FY06

Results of consolidation with Tata Infotech Limited (TIL), post elimination of inter company transactions, have been given in the columns “Merged”



Operational Performance

Regional Delivery Centers• Medium Scale• Serves local customers• Select capabilities• Addresses Language and

Cultural challenges


Cultural challenges

Near-Shore Delivery Centers• Small Scale• Customer Geography &

Time Zone• Builds Customer comfort`



Global Delivery Centers• Very High Scale• Serves large customers• High Depth & Breadth of skills• Matured Processes


NearshoreDelivery Centers

Regional DeliveryCenters

Global Delivery Centers

Scale

Cus

tom

er P

roxi

mity

Breadth of Skills

Custom

er Coverage

High

LowLow

High

High

High

Low

Low

India (matured)China (emerging)

HungaryBrazilUruguay

PhoenixNew JerseyGuildfordPeterborough. . .

Glo

bal S

olut

ion

Labs

Global Solution Labs


Cultural challenges


Cultural challenges







NearshoreDelivery Centers

Regional DeliveryCenters

Global Delivery Centers

Scale

Cus

tom

er P

roxi

mity

Breadth of Skills

Custom

er Coverage

High

LowLow

High

High

High

Low

Low

India (matured)China (emerging)

HungaryBrazilUruguay

PhoenixNew JerseyGuildfordPeterborough. . .

Glo

bal S

olut

ion

Labs

Global Solution Labs

21

Growth by Market

Incl TIL Excl TIL

Americas 58.00 59.80 59.55 59.02 59.50 Europe 24.30 22.20 23.16 22.42 23.20 India 11.50 11.90 11.22 12.52 11.70 Others 6.20 6.10 6.06 6.05 5.60

Total 100.00 100.00 100.00 100.00 100.00

Geography % Q4 FY 2006 Q3 FY 2006 FY 2006 FY 2005

11.5%6.2%

24.3% 58.0%

AmericasEurope

IndiaOthers

• Expansion of services with our blue-chip client-base in North America has enabled our growth in North America. We have several new account wins that will fuel this growth for the future.

• Increased IT spending towards global sourcing by customers and our ability to win a number of SI engagements in the earlier quarters have helped our growth in Europe. The ABN-AMRO and Pearl deals have enhanced our visibility. We see Europe as a major growth area.

• ABN AMRO and integrated IT+BPO offering along with Comicrom are pushing our growth in Iberoamerica.

• In the Indian market, a number of wins that we have achieved in the core banking space and large SI projects will drive our growth for the next fiscal.

22

16.4%

14.3%

4.5%

6.4%

3.7%3.0%

9.9%

41.8%

BFSI Manufacturing Telecom Life Sciences & Healthcare Retail & Distribution Transportation Energy & Utilities Others

Growth by Domain

Incl TIL Excl TIL

BFSI 41.80 41.80 42.30 41.20 38.40 Manufacturing 16.40 17.70 18.10 17.20 19.30 Telecom 14.30 15.40 14.90 15.10 16.40 Life Sciences & Healthcare 4.50 4.30 3.90 4.60 4.00 Retail & Distribution 6.40 6.20 6.30 6.60 6.80 Transportation 3.70 3.10 3.10 3.60 4.20 Energy & Utilities 3.00 2.30 2.40 2.50 3.00 Others 9.90 9.20 9.00 9.20 7.90

Total 100.00 100.00 100.00 100.00 100.00

Q4 FY 2006 Q3 FY 2006 FY 2006 FY 2005IP Revenue (%)

• Expansion of services to existing clients and multiple large deal wins are continuing our growth in the BFSI segment.

• Ramp-up in accounts won in the previous quarters and new client wins across Food and Groceries, Consumer Products and Drug Retailers – all are accelerating our growth in the Retail segment.

• We are seeing continued opportunities to grow our revenues in Telecom, Utilities and Life Sciences.

• TCS’ Engineering and Industrial Services offerings are helping us to expand our portfolio of services into Manufacturing and Utility companies.

23

69.3%

24.5%

2.6%3.7%

Application Development & Maint.Enterprise Solutions Asset Leveraged Solutions Others

Growth by Service Line

SP Revenue % Q4 FY 2006 FY 2006 FY 2005Incl TIL Excl TIL

Application Development & Maint. 69.30 72.40 71.20 71.50 72.90 Enterprise Solutions 24.50 22.40 23.60 22.50 21.82 Asset Leveraged Solutions 2.60 2.40 2.50 2.60 2.64 Others 3.60 2.80 2.70 3.40 2.64

Total 100.00 100.00 100.00 100.00 100.00

Q3 FY 2006

• TCS’ new growth areas BPO, Infrastructure Services, Consulting Assurance Services, Engineering & Industrial Solutions – have all scaled up and are experiencing significantly higher growth rates

• TCS continues to win a number of end-to-end enterprise solution implementation opportunities in the areas of ERP, Supply Chain and CRM – these wins have been a growth driver this year and a momentum has been created for SI projects in the international market for TCS.

• Large, long-term ADM contracts remain a key focus area of growth and these accounts have been growing due to significant cross-sell opportunities.

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Operational Parameters

Incl TIL Excl TIL

Onsite 59.03 58.26 61.40 62.52 61.30 GDC 3.72 3.12 Offshore 37.25 38.62 38.60 37.48 38.70

Time & Material 51.70 49.40 48.40 50.20 48.00Fixed Price & Time 48.30 50.60 51.60 49.80 52.00

* Excluding Domestic Clients

Contract Type

FY 2006 FY 2005Revenue %

Delivery Location*

Q4 FY 2006 Q3 FY 2006

• TCS’ Global Network Delivery Model has gained scale and maturity.

• We have over 40 of our large customers use our GDCs in Latin America, Hungary and China. We have a total of 3056 associates in these locations

• We are significantly increasing the offshore component in our existing relationships.

• We see further opportunities for offshore leverage with our new customers (gained through large deals as well as through acquisition) in the coming quarters.

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Q4 FY 2006Incl TIL Excl TIL

Clients Contribution *Revenue %Top 1 # 3.70 3.67 3.97 3.70 5.10Top 5 17.00 17.02 17.50 17.00 19.20Top 10 27.50 27.61 27.70 27.50 30.50

US$ 1 mln Clients 256 243 229 256 214US$ 5 mln Clients 96 87 87 96 76US$ 10 mln Clients 54 55 53 54 42US$ 20 mln Clients 31 29 28 31 25US$ 50 mln Clients 9 6 6 9 5

* Last Twelve Months # GE Group companies reclassified

Q3 FY 2006 FY 2006 FY 2005

Client Parameters

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Client Acquisition and Expansion

Particulars Q4 FY 2006 FY 2006 FY 2005Incl TIL Excl TIL

Active Clients 748 766 677 929 621

New Clients 89 88 83 330 246

Revenue % from Repeat Business 91.9 94.9 94.8 95.2 95.1

Revenue % from New Business 8.1 5.1 5.2 4.8 4.9

Q3 FY 2006

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Client and Delivery HighlightsTCS successfully implemented common loan origination & servicing of credit card application for a major financial services company in US

TCS implemented E-Signature for one of the largest life insurance companies in theU.S. resulting in Improved cycle time, Remote Access for authorized users, Process & Cost Efficiency, Reduced Paper, Data Storage and improved Ease of Doing Business.

TCS has set-up a global operations center for a large retailer to remote manage their distributed operations and assist them in capacity planning and remote deployment of software.

For a fortune 500 company in China, TCS successfully implemented an integrated ERP solution to automate and digitize manufacturing process which resulted into higher productivity and ROI.

TCS developed a faster, simpler quotation system for a leading financial services group in South Africa which has been launched to its intermediaries resulting in increased efficiency and flexibility.

TCS delivered a Service Oriented Architecture (SOA) solution to a global investment banking firm for performing bond calculations. This is a first of its kind application resulting in full empowerment of field force through real-time connectivity. This scalable solution has transformed the business model achieving significant reduction in total cost of ownership.

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Representative Wins A major telecom service provider in Europe selects TCS for an end-to-end development and deployment of a strategic OSS platform. The deal is worth over $35m.

A leading European consumer products company has selected TCS for providing an end-to-end application outsourcing in a long-term contract.

A leading financial services group in South Africa has engaged TCS to define their enterprise architecture and develop an integrated CRM application.

A leading European Bank and a large bank in India – both have chosen TCS for implementing a Business Intelligence solution to achieve Basel II compliance

TCS has been selected by the one of the largest mobile phone manufacturers in Latin America to implement its global marketing platform. The TCS consulting team has developed a Customer Data Integration (CDI) solution that enables real-time analytics and deeper customer insights. In another significant engagement, a global investment bank has engaged TCS consulting team to develop a Customer Data Integration solution for their single customer identification initiative.

TCS’ Enterprise solution practice has won a number of engagements including a Siebel-based customer analytics solution for a global consumer products company and a customer support solution for a large financial services group in South Africa.


Profiles of ‘Select’ Growth Engines

Engineering &Engineering &Industrial ServicesIndustrial Services

EngineeringEngineeringEmbedded S/WEmbedded S/WR&D ServicesR&D Services

Business Process Business Process OutsourcingOutsourcing

Transaction ProcessingTransaction ProcessingBack Office SupportBack Office SupportInbound Call CentersInbound Call CentersEngineering ServicesEngineering ServicesDatabase ServicesDatabase Services

Global ConsultingGlobal ConsultingBusiness & Process Business & Process

Consulting Consulting IT Strategy ConsultingIT Strategy Consulting

IT Operations ConsultingIT Operations ConsultingSecurity ConsultingSecurity Consulting

Asset Based Asset Based OfferingsOfferingsProductsProducts

Product Based Product Based ServicesServices

IT Infrastructure ServicesIT Infrastructure ServicesIT Infrastructure Outsourcing IT Infrastructure Outsourcing

Facilities ManagementFacilities ManagementDatacenter ManagementDatacenter Management

Network ServicesNetwork ServicesDesktop, Helpdesk Desktop, Helpdesk

Server and Storage ServicesServer and Storage Services

IT Solutions & ServicesIT Solutions & ServicesApplications Development, Applications Development,

Maintenance, Migration, Maintenance, Migration, Reengineering & TestingReengineering & Testing

Packaged Software Packaged Software ImplementationImplementation

Systems IntegrationSystems IntegrationSystems OutsourcingSystems Outsourcing

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Our current associate strength in BPO operations is 4700 at the end of FY06

Key Engagements

For a leading US retail store chain, TCS successfully transitioned operations to offshore in the areas of F&A, Merchandizing, Customer Care and Services. We have now ramped this to 250+ FTEs

A telecom provider in the USA has engaged with TCS for its integrated backend telecom operations covering order entry, order provisioning and billing processes.

A leading bank based in Spain selected TCS for providing transaction based BPO services in a large, long-term contract. TCS will leverage its BPO unit Comicrom in Chile to deliver the services to the bank.

BPO

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EIS practice added 19 new overseas customers to TCS' customer base in Q4, and 92 overall during FY 06

The practice grew from 2442 associates in FY05 to 4054 today added 1612 in FY06

Key Engagements

A UK based utilities company selected TCS to provide control systems integration services across its operations, in a 4 year multi-million pound engagement under its new asset management program

TCS helped a South Africa based global chemicals and fuels major architect an enterprise-wide manufacturing execution systems (MES) solution to integrate its shop floor and enterprise systems. The solution is being rolled out across its global operations

An American EPC company has chosen TCS for consultancy and implementation services for its plant design engineering

Engineering & Industrial Services

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ITIS Practice continues to grow adding 16 new clients and 420 employees in Q4. TCS now has 121 active clients and 2795 employees in ITIS.

Key Engagements

TCS’ Global Infrastructure Command Center has been well received by the market

Set-up a global operations center for a leading US retailer, to remote manage their distributed operations, remote deployment of software, capacity planning and provisioning.

TCS is setting up a global operations center for a large consumer electronics manufacturing company to provide support to their North American data center remotely. The client expects to replicate this model across all their data centers globally

One of the largest peripherals manufacturers in North America has awarded TCS a multi year, multi million dollar E2E managed services contract. TCS will leverage its Network Delivery model to support their globalinfrastructure.

IT Infrastructure Services

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TCS won 24 new clients for assurance services in FY06, including 7 of the Fortune 500.

Services like Enterprise Test Strategy Consulting is gaining traction among our customers. Today Assurance Services provides test strategy consulting to 5 of the Global 500 companies.

Key Engagements

For a major Health Care Service Provider in USA, TCS is setting up a Testing Center of Excellence to increase the operational efficiency by 25% through automation and resource optimization

For a Payment Processor in Canada, TCS reevaluated their TestingStrategy and provided a strategy to automate 60% of the test bedthereby reduce 30% of the testing effort

For a Professional Services Conglomerate in USA, TCS has been asked to independently validate a Home Equity Loan Processing System across different States

Assurance Services

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GCP front-ended and added 12 new customers in Q4 and 49 for FY06. GCP services 126 active customers today.

GCP won 77 new engagements in Q4.

Discrete consulting solutions in Architecture, Process Transformation, Information Security, Strategy and Governance have reached critical mass.

Key Engagements -

For a large South African Insurer, TCS is building its policy administration platform, by adopting a Service oriented architecture and an industry standard reference business processframework

For a large computer peripherals manufacturer, TCS won a consulting deal to deliver an integrated IT strategy, service management and infrastructure services along with business application consolidation to SAP

Global Consulting Practice


Human Resources

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3,4553,736

62,832

59,216

53,042

48,583

3,6883,648

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Q1-06 Q2-06 Q3-06 Q4-06

Associates in TCS Ltd Associates in Indian Subsidiaries

Total Employees 66,480No. of TCS Employees : 62,832

No. of Employees with Indian subsidiaries (CMC and WTI): 3,648.

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27,377

14,176

21,140

10,871

0

5,000

10,000

15,000

20,000

25,000

30,000

FY 05 FY 06

Gross Additions Net Additions

FY06 Additions - Gross 27,377 & Net 21,140 Employees

The net additions through recruitment is 14,758 and net additions through M&A is 6,382 (TIL, ASDC, AFS, BTS, FNS, Comicrom)In Q4-06 we recruited a net of 3,571 employees

Utilisation Rate in Q4-06 was 78.95% (excluding trainees), 75.80%

(including trainees)Our attrition rate for the Last Twelve Months (LTM) was 9.9%.

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No of Employees in GDCs

1,8671,676

1,3701,332

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

Q1-06 Q2-06 Q3-06 Q4-06

Global and Diverse WorkforceNo. of Employees in Global Delivery Centers increased to 1,867 from 1,223

Non-Indian nationals was 6.5% from 52 nationalities

24% of our workforce comprises women

51% of our employees have more than 3 years of work experience

We have 2591 MBAs , 108 PHDs and 363 Chartered Accountants.

911 of our associates are PMI certified and 31 are Prince 2 Certified.

Uruguayian11%

Chinese10%

Chilean34%

Brazilian20%

Hungarian6%

British2%

Japanese1%

Mexican1%

Australian6%

Romanian1%

Others (41 Nationalities)

8%

39

Thank You!

Results for Quarter IV FY 2005-06 - Tata Consultancy Services

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Transcript of Results for Quarter IV FY 2005-06 - Tata Consultancy Services