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TCS’ deal with the Ministry of External Affairs represents its continued penetration into the domestic e-governance spends. This helps expand its Indian footprint, which contributes 8.7 per cent of its revenues.

The deal size is around Rs 1,000 crore, spread over six years. But domestic deal sizes are typically smaller than those in the US and Europe, and the margins even smaller if it is Government clientele in India. This deal follows an earlier deal TCS had won with the Department of Company Affairs in 2006, which was worth around Rs 345 crore.

The present deal would entail TCS digitising and enabling online filing of applications for passports. The time for issuing a new passport is set to be just three days post police verification of address of an applicant. The Union Budget has indicated that there would be enhanced spending on e-governance. Government spending in this area has just started to pick up.

For TCS, this demonstration of its execution capabilities would make it well placed to tap further into Government clientele.

Such deals would also reduce dependence on the US and Europe and the troubled banking, financial services and insurance segment for TCS. The stock ended 10.3 per cent higher on Monday.

More Stories on : Stocks | E-Governance | Tata Consultancy Services Ltd | Software

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