“In these kind of deals, it is likely to have more in sourcing at first. As we build scale and capability in the geography the need to insource from deal could become less over a period of time,” said K Krithivasan , President of the Banking and Financial Services Business Unit at TCS. “Early deals may have insourcing but successive deals may not.”
TCS deals of $2-billion-plus deal —its largest ever — with Transamerica, marked the Indian outsourcing leader’s entry into the highly specialised US third-party insurance administration business.
“In general, the BFSI segment is slowing down investments in traditional outsourcing work, but increasing aggressively in emerging areas such as automation and digital. Hence this is more an indication that TCS is currently winning the larger piece of the emerging tech areas and Infosys is playing catch-up,” said Phil Fersht, CEO at HfS Research.
“As an organisation we are broadening our revenue base across multiple industry verticals. We don’t have a target. We want to grow BFSI and every other segment,” Krithivasan said. “Even if you have broad-based revenue coming in you are likely to have more revenue coming in from BFSI than any other industry.”
TCS’ overall revenue is weighed heavily towards large banks in the US. Percentage growth from regional banks is high but in absolute terms the value coming from large banks is more. Geographically, Europe is contributing more to growth than the US.
“European banks are continuing their growth. Europe has been a growth driver for us. We find demand is coming from multiple streams – many traditional large banks in Europe which have not outsourced in the past, they are trying to do their first generation or maturing outsourcing journey. There is a market share and new work is coming in,” said Krithivasan.