The Hindu Business Line : TCS to grow at industry plus rates, says Ramadorai

He further says that the large deals that TCS has signed will be a sustained revenue stream. Mr Ramadorai expects TCS to continue to grow at industry plus growth rates.

Excerpts from CNBC-TV18's exclusive interview with Mr Ramadorai:

Tell us a little bit about how you are feeling going into FY07?

2006 has been a defining moment for TCS. We have been very strategic about organic performance as well as through our mergers and acquisitions. The large deals, which we have signed, are going to be a sustained revenue stream.

The expansion of services to the large accounts is also going to givephenomenal opportunities to us.

Without giving the guidance, I can say that we are on a great wicket and we believe that the future will be very good for the industry as well as for TCS. We will definitely grow at industry plus rates; there is no question about it.

Was bonus any kind of signal to the investors?

We want to take care of our investors. We believe that they have been supporting us extensively. We ought to give them returns, Rs 13.50 the total dividend for the year and 1:1 bonus.

The pricing at which new deals are coming, analysts seem to believe that may be there could be little compromise on pricing.

Any large deal is a multi-year deal. Any large deals for the kind of work, which they are going to be, outsourcing will have certain elements included as part of the overall package.

However, that does not stop a company from entering into new opportunities and newer areas through expansion of services. For the specified large deals, which spans multi-years there will be a cost element that is associated with it.

Bringing about the operational efficiencies and offshore leverage is completely left to people like us. That is what TCS is good at, operational excellence and execution to retain margins and to bring in the kind of project management, program management capabilities that we have built over the years.

But the new services we offer are at a premium price irrespective of whether it is an existing client, large client or a new client. So we need to position ourselves, on the value we offer to the client and we are absolutely clear. Being the leader, we have no question about under estimating and that is what the management team is good at.

Could you give us some sense of what you have been able to do with Tata Infotech, Comicrom, CMC etc?

I think the integration of these companies, whether it is CMC, Tata Infotech, FNS, Comicrom or Diligenta has been fully complete and they will see the synergistic values in the long run. The best of these companies, the best management talent and a market strategy that is integrated with TCS is the direction we take. When we talk about expansion of services, what these companies bring and with TCS' help and integrated offering, is where we are going to see a lot of benefits. These structured deals or these acquisitions were done with a purpose and we measure them internally on the basis of whether we did the right thing or not.

Are you in talks with any other potential acquisition candidates?

We may not be in any talks but the scanning continues all the time.

Integration expansion with a global work force and if you look at Comicrom or Diligenta, almost 2,200 people came through this and integrating that is a major HR challenge.

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