TCS sees strong tech growth in India, Brazil and other key markets

Business Standard

24-04-2025

Some short-term headwinds notwithstanding, there is a sense of optimism in India, Brazil and other 'growth markets' around tech adoption and transformation opportunities, a senior executive of Tata Consultancy Services (TCS) said on Thursday.
The company continues to be upbeat about potential of the domestic market itself and is doubling down on its focus on India, where a combination of favourable factors including economic growth, innovation drive, favourable demography are all coming together at this points of time, Girish Ramachandran, TCS' President - Growth Markets, told PTI.
"...there has been a sense of optimism around all the markets that I go to. Yes, there will be headwinds in the short term but overall if you look at most markets, whether it is Brazil, whether Saudi Arabia, whether it is India, whether it is Asia Pacific, there is a sense of optimism and most markets tend to do well in terms of the GDP growth, so overall I do think that from 'growth market' point of view, we should do well in the coming year," Ramachandran said.
India accounts for 6-8 per cent of the company's overall revenue, which pegs it in the ballpark of a substantial USD 2 billion chunk given TCS' FY25 revenue of over USD 30 billion.
"So it's a fairly large piece of the business for TCS and almost all sectors are doing well, especially the financial services sector that we have a very strong foothold in, and we continue to ensure that we double down on that as well," he said.
TCS' FY25 net profit rose 4.2 per cent to Rs 48,553 crore on the back of a 6 per cent growth in revenue to Rs 2.55 lakh crore or over USD 30 billion.
The country's largest IT services firm had reported a 1.7 per cent decline in the March quarter net profit to Rs 12,224 crore, driven largely by a margin contraction.
During the earnings briefing on April 10, TCS' Managing Director and Chief Executive K Krithivasan had said the firm expects FY26 to be better than FY25 on the revenue front, although he did acknowledge the ongoing challenges, in terms of delays in decision-making on discretionary spending.
Ramachandran said TCS' growth markets - Asia Pacific (APAC), Middle East and Africa (MEA), Latin America (LATAM) - are seeing rising adoption of technology, backed by a growing realisation that tech can drive better services for citizens and business.
"If you look at most markets, there is a sense that technology will change livelihoods of people and citizens at large...most of these markets are going to jump one technology wave and with new technology emerging in these markets, there is a sense of optimism that technology can actually provide better services to the citizens and to business, at large," he said.
On whether growth runway presented by these markets can, to an extent, blunt the impact of macro-uncertainties in larger global markets that have trade and tariff overhangs, Ramachandran said depending on the requirements, cost optimisation or transformation deals could play out, and added that TCS is well positioned with its offerings in both the situations.
"If you look globally, we are still 2.7 per cent of the market share globally. So there is still a lot of opportunity that TCS can play, whether it is a major market or growth market. There could be a shift in the opportunities. For example, if the markets go down we would go and position our cost optimisation play. That is a significant opportunity for large IT companies like ourselves. And in the growth markets where there is a lot of optimism, or not so much pessimism, there is sense that transformation could be a large opportunity for these markets. So, overall, I do think that we can play across multiple segments and there is an opportunity for TCS to be in all these spaces," according to Ramachandran.
On some international agencies lowering India's growth projections to 6.2-6.7 per cent for FY26, and whether he anticipates an impact on domestic tech spends as a result, Ramachandran said while it is too early to draw conclusions, most customers continue to invest.
"As of now, we go to most of our customers, they continue to invest in the market. At 25 basis points, there is not so much to call for in terms of growth (impact). If we go to any large country and say that we are only going to degrow by 25 basis points, any country will take it. In that way, I do think there is a sense of optimism across these markets, and the public sector spend in India will also continue to grow," he said.
The IT services behemoth on Thursday announced India-focused offerings including an indigenous and secure cloud for government and public sector enterprises, aimed at strengthening the country's data sovereignty and accelerating AI capabilities.
TCS SovereignSecure Cloud is engineered to keep sensitive data within India's borders, leveraging the company's data centres in availability zones of Mumbai and Hyderabad.
The Tata Group company also introduced TCS DigiBOLT, an AI-enabled low-code platform, and its globally-recognised Cyber Defense Suite in India, that the company said would empower enterprises to fast-track their digital innovation and cyber resilience.
The line-up of offerings include SovereignSecure Cloud - a first-of-its-kind, indigenous and secure cloud for government and public sector enterprises, that strengthens India's data sovereignty and accelerates its AI capabilities. This cloud comes with integrated AI capabilities to support government institutions, public sector enterprises, and regulated industries.
"I think it's an opportunity for India to really accelerate. And that is why we are also doubling down on what we can do in the country," Ramachandran said.