TCS pips Infosys to bag MP government contract

Rs 150-crore solution to help state to monitor financial transactions in real time

Tata Consultancy Services (TCS), the country’s largest information technology (IT) services company, has bagged a Rs 150-crore e-governance contract from the Madhya Pradesh (MP) government.

Other than TCS, Infosys Technologies, which has set up a business unit for such contracts in India, was also in the fray.

Though Infosys emerged as the lowest bidder (L1), the company lost out to TCS on operational grounds, as the MP government found the operational expenses quoted by Infosys to be higher than TCS’s, industry sources familiar with the tender process said. “While the price quoted by Infosys was lower, the capex to opex ratio was very high, which was one of the criteria for selection,” the sources said.

A spokesperson at TCS said, “We don’t comment on individual deals.” Infosys could not be reached for comments.

The Madhya Pradesh government is introducing an ‘Integrated Financial Management Information System’ to monitor the state’s financial transactions on a real time basis. The software platform to be implemented by TCS will help the state revenue department develop an integrated solution to automate Public Provident Fund management, human resources and payroll management, and pension management.

TCS is one of the few Indian companies which have a significant presence in the domestic market, whether in the government or corporate space. The company, which derives about 8 per cent of its global revenues from India, have customers like the NSE, National Securities Depository (NSDL) and Clearing Corporation of India (CCIL).

“The IT expenses in the Indian market have been on the increase in the last few years. However, most of the revenue in the Indian market comes from new systems’ development which limits the scope of annuity-based revenue and leads to unpredictability. With our domestic business becoming larger, with increasing number of clients, the volatility in the Indian market is slowly coming down,” N Chandrasekaran, CEO and MD, TCS, had said earlier.