TCS gains after Diageo deal

TCS rose 0.45% to Rs 2208.40 at 11:12 IST on BSE after the company said that Diageo, the world's leading premium drinks business, has selected TCS as its new global IT provider.

The company made the announcement during trading hours today, 20 February 2014.

Meanwhile, the BSE Sensex was down 91.07 points, or 0.44%, to 20,631.90.

On BSE, so far 31,000 shares were traded in the counter, compared with an average volume of 99,133 shares in the past one quarter.

The stock hit a high of Rs 2,221.50 and a low of Rs 2,202 so far during the day. The stock hit a record high of Rs 2,384.20 on 14 January 2014. The stock hit a 52-week low of Rs 1,364 on 30 April 2013.

The stock had outperformed the market over the past one month till 19 February 2014, falling 0.78% compared with the Sensex's 1.62% fall. The scrip had also outperformed the market in past one quarter, rising 8.28% as against Sensex's 0.80% decline.

The large-cap company has an equity capital of Rs 195.87 crore. Face value per share is Re 1.

Diageo, the world's leading premium drinks business, has selected Tata Consultancy Services (TCS), the leading IT services, consulting and business solutions organisation, as its new global IT provider. The decision by Diageo to partner with TCS is the latest milestone in a programme to transform the way it provides IS services to around 36,000 employees, operating in 180 countries around the world, TCS said in a statement.

In the future, TCS will manage Diageo's global IT infrastructure, data centres and servers, in addition to providing service desk support to employees. This solution will provide a greater level of flexibility and differentiation of services to meet market needs, allow for swift adoption of future technology trends, and an enhanced current self-serve capability to deliver an improved end user experience, the company said.

Ivan Menezes, Chief Executive Officer, Diageo plc, commented; "Our partnership with Tata Consultancy Services is the latest milestone in our strategy to create a world-class IT service to support Diageo's global strategy and deliver efficient growth. Working together, I believe that we can make a significant step change in the way that IS supports our 36,000 employees around the world, giving them the freedom and agility to drive growth for Diageo in each of our markets."

Natarajan Chandrasekaran, Chief Executive Officer and Managing Director of Tata Consultancy Services, commented: "Globally businesses are embracing technology to enhance customer experience, drive innovation and propel their growth. Smarter IT - from the data centre to the end user's experience - is critical in this context and we are delighted to work with Diageo to help enable this transformation using our strong industry expertise and technology capabilities."

Mette Ahorlu, Research Director, European Services, IDC said, "TCS has invested strongly in infrastructure management over the past few years and has created a value proposition that appeals to many European organisations. Its industrialised service delivery combined with a flexible approach to clients matches client needs well as this deal shows."

On a consolidated basis, TCS reported 15.1% rise in net profit to Rs 5333 crore on 1.5% increase in revenue to Rs 21294 crore in Q3 December 2013 over Q2 September 2013.

TCS is an IT services, consulting and business solutions organization. TCS offers a consulting-led, integrated portfolio of IT, BPS, infrastructure, engineering and assurance services.

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