Mumbai: Although analysts are predicting consolidation among technology firms globally, Tata Consultancy Services Ltd (TCS) has enough momentum to grow and is not looking to “buy growth”, its top executive said.
Room to grow: TCS chief executive N. Chandrasekaran. Abhijit Bhatlekar / Mint
“We are not looking to acquire for size,” said N. Chandrasekaran, who on Tuesday took over as chief executive of TCS, India’s largest software services firm. “We are not looking to buy growth.”
He said TCS’ revenue of around $6 billion (Rs28,320 crore) in 2008-09 represented only 1% market share internationally and that there was sufficient room for TCS to grow on its own without making acquisitions.
Besides focusing on developed markets where information technology (IT) spending is higher, he said that TCS was “investing and building organic growth in emerging markets”.
The firm has set up two teams at its centre in the US to gain traction in government and healthcare businesses. Indian IT services firms have been traditionally weak in both these areas.
Analysts have been predicting more consolidation in the wake of the $3.9 billion acquisition of Perot Systems Corp. by Dell Inc. and the $6.4 billion purchase of Affiliated Computer Services Inc. by Xerox Corp., both in September, and the $13.9 billion takeover of Electronic Data Systems Ltd by Hewlett-Packard Co. in May 2008.
Chandrasekaran said that TCS may look at strategic purchases to add niche capabilities to its existing portfolio.