Battle for renewal of contracts is back; Indian IT companies eye deals over $100 billion

The billion dollar contracts are becoming rare and it is a tough fight. Indian IT companies such as TCS, Infosys, etc are back in the renewal of contracts battle and are eying deals worth $100 billion.

The renewal contracts for 2016-17 will pour in from Deutsche Bank, UBS, Mitsubishi and Vodafone.

The research and outsourcing advisory firm ISG stated the renewals are of prime importance for Indian IT companies because big customers like AstraZeneca, Lowe's and JPMorgan Chase are going for insource software projects, making big billion contracts rare.

As per ISG, large technology customers such as British utilities firm National Grid, Deutsche Bank, UK's Network Rail and Japan's Mitsubishi currently have billion-dollar engagements with clients such as IBM, CSC, Hitachi and Carillion, all of which will come up for renewal.

"The competitive intensity is going up in the industry and hence the pressure on pricing levels will continue. The scope and construct of the deals are also changing with infrastructure delivery models becoming hybrid (mix of cloud and on premise) quite frequently," said Dinesh Goel, partner and India head at ISG.

It is noteworthy that Infosys is on a momentum as it reported three consecutive quarters of outperformance.

"Our deal wins have improved dramatically and we are approaching $800-900 million a quarter in large deals. That's more than double of what we used to do," Infosys’ Vishal Sikka had stated recently.

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