TCS eyes $5 billion from digital vertical

The company hired over 1,500 this fiscal

Targeting a revenue of up to $5 billion from the digital vertical in the next few years, India’s largest software exporter Tata Consultancy Services (TCS) on Wednesday said it had hired 1,500 experienced hands in the segment so far this financial year.

“During the first three quarters of 2014-15 alone, TCS has made a lateral hiring of over 1,500 experienced professionals with core digital skills,” a spokesperson said.

The hiring includes data scientists and professionals in domains like design visualisation, user experience and the ‘Internet of Things’.

The company, which employs over 3,00,000 people, is facing flak on social media for laying off around 1,000 professionals in the country for non-performance and had vociferously defended its actions.

So far this financial year, TCS had a gross employee addition of 16,561, taking the total headcount to 3,18,000, the employee utilisation was 86.7 per cent excluding trainees.

The company's attrition stood at 13.4 percent and TCS said it would like to keep it at 12-12.5 percent range and that the increase is not due to any layoffs being carried out, as being speculated on social media.

About the sacking of the 1,000-odd for non-delivery, managing director and chief executive N Chandrasekaran on the Q3 earnings day had said the "involuntary attrition", where an employee goes out without tendering her resignation, is a normal process which the company carries out each year.

He had said that only 1,000 jobs have been lost in the country as part of the exercise, while 1,574 have also been asked to leave the company from outside the country.

The Tata-group company today said it is targeting clocking USD 3-5 billion in revenues from the digital opportunity "over the next few years".

TCS had last October said it might not be able to achieve the USD 5-billion mark in the original target of 3-4 years.

Chandrasekaran, who has so far declined to give revenue from the segment in post-results interactions, today said customers are ramping up in the digital space and the deal sizes are increasing.

"We are seeing adoption of digital by every company, across every industry, in every market. The size of deals is increasing from a few hundred thousand dollars to about a million dollars," he said.

The TCS spokesperson said digital is the "default" for businesses across the globe and companies from all sectors are investing in it.

"The company plans to invest more in automation technology to drive more efficiencies across businesses," the spokesperson said.

Earlier this month, TCS had reported a marginal dip in the December quarter net profit at Rs 5,328 crore due to lower margins under the IGAAP system of accounting, while its profit in the preceding September quarter stood at Rs 5,244 crore.

TCS' operating margin dipped by 2.88 per cent as compared to the same period last year, to 26.9 per cent, but was up 0.21 per cent over the preceding September quarter.