Hindustan Times (Jalandhar)

TCS wins $690-mn IT out­sourc­ing con­tract

- Varun Sood feed­back@livemint.com

THE LAT­EST DEAL BRINGS $69 MIL­LION IN NEW BUSI­NESS, OR 37 BA­SIS POINTS IN­CRE­MEN­TAL GROWTH, FOR TCS

BEN­GALURU: At Tata Con­sul­tancy Ser­vices Ltd (TCS), it is rain­ing deals. In­dia’s largest in­for­ma­tion tech­nol­ogy out­sourc­ing com­pany said on Tues­day that it had won a $690-mil­lion, 10-year con­tract from a unit of Bri­tish in­surer Pru­den­tial.

The lat­est or­der is the third large out­sourc­ing con­tract won by TCS in less than a month. It won two over $2 bil­lion, mul­ti­year out­sourc­ing con­tracts from tele­vi­sion rat­ings mea­sure­ment firm Nielsen and Transamer­ica Life In­surance Co., a unit of Dutch in­surer Ae­gon NV, in De­cem­ber and ear­lier this month.

TCS will use its in­surance plat­form, BaNCS and Dili­genta, the UK-based sub­sidiary of the com­pany, to largely do away with hu­man in­ter­ven­tions in com­plet­ing many of the back-end claims pro­cesses of M&G Pru­den­tial, the Euro­pean sav­ings and in­vest­ments busi­ness of Pru­den­tial.

TCS won the out­sourc­ing con­tract from Pru­den­tial over Bri­tish IT out­sourc­ing firm, Capita Plc, which was ear­lier hired by the Bri­tish in­surance gi­ant.

TCS does not out­line any quar­terly or yearly growth out­look but 1% se­quen­tial growth in the March quar­ter will help it end the cur­rent year with $18.95 bil­lion in rev­enue, a 7.8% dol­lar rev­enue in­crease in 2017-18. This means TCS will need to im­prove on its cur­rent year’s growth by 220 ba­sis points to achieve at least 10% dol­lar rev­enue growth in 2018-19.

One ba­sis point is one-hun­dredth of a per­cent­age point.

The lat­est deal brings $69 mil­lion in new busi­ness or 37 ba­sis points in­cre­men­tal growth for TCS.

TCS stands to make over $200 mil­lion in new busi­ness or more than 110 ba­sis points in in­cre­men­tal growth from the con­tract with Transamer­ica. Ad­di­tional deal wins from a unit of Lloyds Bank­ing Group, Rolls Royce Group, and Marks and Spencer is ex­pected to bring more than $100 mil­lion in new busi­ness or over 60 ba­sis points in­cre­men­tal growth in the next fis­cal, ac­cord­ing to Mint’s cal­cu­la­tions, to­gether bring­ing over 200 ba­sis points in in­cre­men­tal growth.

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