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TCS, Infosys, L&T triplets tank on US troubles — wiping $10 billion off tech wealth

<ul><li>Rising crude oil and gas prices during the last few quarters because of supply side constraints led by the Russia Ukraine crisis has benefited the oil producer to mint more money.</li><li><keyword id="6354737" type="General" weightage="20" keywordseo="ongc" source="Orion">ONGC</keyword> enters the elite club of top most profitable companies in India as it makes a profit of ₹40,305 crore in FY22.</li><li>The oil producer has surpassed Tata Steel, TCS and HDFC Bank to reach the second position wherein Reliance Industries holds top position.</li></ul>State-owned oil explorer ONGC beat two Tata group firms - TCS and Tata Steel to become India’s second most profitable company, after Reliance Industries, in FY22. Its record profits came in spite of decline in production for the last 11-18 quarters, aging fields, and lack of new discoveries. However, crude oil prices soared to almost $140 a barrel - making even its low output very valuable. ONGC contributes to 70% of India’s total oil and gas production. “A rally in global crude oil and natural gas prices is a key driving factor behind ONGC’s profitability,” said a report by YES Securities. It added that any moderation in crude prices will affect its cash flows as its capex requirement is very high to maintain production in its aging fields. ONGC reported a net profit of ₹40,305 crore for FY22 surpassing Tata Steel, by a decent margin. It also beat one of India’s most valuable companies - TCS in terms of profits - after crude oil prices soared. <div type="image" title="top 5 companies col (1)" height="900" width="1200" msid="91890739" hostid="261"></div>Taxes, sanctions and more to affect ONGC profitability As expected, this rise in profitability might be unsustainable, especially since analysts believe that Russia-Ukraine tensions could settle down, cooling off the soaring crude. “ONGC’s performance depends on how long geopolitical tensions persist as its profits are directly connected to crude oil prices,” Sanjiv Bhasin, executive vice president, markets &amp; corporate affairs at India Infoline, told Business Insider India. Bhasin believes that these tensions will ease by mid-July. As soon as crude prices come down, so will ONGC’s place in the list of most profitable companies. “Brent will not sustain the $110 kind of level. One or two years down the line, Brent will cool down. The two year future market also shows prices cooling off about $80-$90 per barrel range so that will definitely impact the margins for ONGC,” Anshuman Khanna, the founding director of Valpro, told Business Insider India. While the advantages of the war might go away soon, its effects - like sanctions on Russia - could remain and can affect ONGC’s fortunes negatively. <div type="image" title="ongc (1)" height="900" width="1200" msid="91890758" hostid="261"></div>The Russian connection ONGC’s international arm, ONGC Videsh owns stakes in multiple energy assets in Russia. One of the country’s gas producing assets Sakhalin-I has already shown signs of trouble as US major Exxon said that it would exit the block. ONGC has a 20% stake in it, along with interests in Sakhalin II, and Vankor fields in Siberia. “Russian assets are facing two issues -- one is the fact that Russian crude is trading at a discount about $10-$20 to Brent and second issue is repatriation of Russian dividend from these assets because of sanctions. It’s a real risk, which could jeopardize their entire Russian investment,” Anshuman Khanna, the founding directors of Valpro, told Business Insider. The Indian government too isn’t allowing the state-owned oil explorer to enjoy its profits either. It is believed to collect some of it in the form of a <a href="http://theres-a-strong-case-to-levy-windfall-taxes-11653810086031.html">windfall tax on oil producing companies.</a> Analysts at Citi call this tax threat an overhang. There is speculation that the government might impose a 25% tax on profits of oil and gas producing companies as crude prices have surged over 50% in 2022. The stock has gained over the last one year, but does not reflect the positive impact of crude oil on its profits. The sanction risk and taxes are making its short-lived story of profitability even less enticing to investors. <div type="image" title="ONGC profit" height="900" width="1200" msid="91890803" hostid="261"></div> SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="http://www.businessinsider.in/business/corporates/news/nykaa-to-face-competitive-heat-but-its-omni-channel-experience-maybe-the-game-changer/articleshow/91883946.cms">Nykaa to face competitive heat but its omni-channel experience maybe the game changer</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="http://www.businessinsider.in/finance/banks/news/citi-kotak-icici-and-other-investment-banks-earned-2600-crore-through-ipos-last-year/articleshow/91887303.cms">Indian companies raised $14 billion via IPOs and their i-bankers made $300 million in fees</a>

ONGC beats Tata Steel, TCS to become India’s 2nd most profitable company - but Russian links may spoil the party

<ul><li>Valuable Indian information technology stocks have tumbled heavily in the last one month, falling up to 18%.</li><li>While spending on digital transformation will continue from large enterprises, the overall growth rate in tech spending could decelerate as companies feel the pressure of inflation on their toplines.</li><li>The Nifty IT index has fallen two times more than the benchmark index Sensex and Nifty 50 in the last one month.</li></ul>Indian information technology stars’ dream run in the post-pandemic era could be slowing down, with the Nifty IT index falling twice as much as the benchmark Sensex and Nifty 50 in the last one month. Nifty IT index slipped over 13% while the benchmark indices have fallen over 6% during the one month period. One of the reasons for the sharp fall is because of the massive selloff in the US markets, which is where most of our tech majors’ revenues come from. Currently, the <keyword id="46964" type="General" weightage="20" keywordseo="it-sector" source="Orion">IT sector</keyword> is facing a challenging macro environment including <a href="https://www.businessinsider.in/finance/news/indias-central-bank-confirms-another-rate-hike-is-coming-in-june/articleshow/91739640.cms">rising borrowing costs</a>, making it difficult for companies to spend more on digital transformation. Digital transformation spendings could see a slowdown The biggest driver behind IT companies’ record growth in the post-pandemic era has been enterprises enrolling in digital transformation programmes, revamping their IT infrastructure and adopting new technologies. Those days of record growth could be behind us, suggest analysts. “We think enterprises’ willingness to spend on digital transformation will continue, but growth rates on spends are likely to decelerate constrained by revenue and earnings volatility,” said analysts at Nomura. Recently, top US retailers Walmart and Target <a href="https://www.businessinsider.in/retail/news/heres-what-walmart-and-target-are-saying-about-soaring-food-gas-and-labor-costs-and-what-it-could-mean-for-prices/articleshow/91668863.cms">reported </a>poor earnings, hinting at topline troubles in the economy. In fact, FAANG stocks (Facebook, Apple, Amazon, Netflix, and Google) have lost more than $2 trillion in valuation since the beginning of the year. More pain ahead Brokerage firm Nomura Research sees a potential slowdown in terms of revenue growth for IT companies in FY24. It expects tough days ahead for tech spending amid challenging macroeconomics conditions, hawkish US Fed stance to tame inflation and profit warnings by corporates across the globe. JP Morgan downgraded its ratings on TCS, HCL Tech, Wipro, L&amp;T Tech to ‘underweight’ from ‘neutral’ on potential macro slowdown. “Indian IT growth was accelerating till 3Q22 and has begun to slow down from 4Q22, which is likely to worsen into FY23 from tougher comps, supply issues and eventually a worsening macro. With peak sector growth behind, growth deceleration should continue to weigh on sector multiples,” said a report by JP Morgan. It downgraded the IT sector stance to Underweight and target multiples by 10-20%. “Fast changing macroeconomic conditions, hawkish Fed stance to tame inflation through continued interest rates hikes and profit warnings by corporates across the globe seem to suggest tough days are ahead for tech spending, in our view,” said analysts at Nomura. <table style="border-width: initial; border-style: none; table-layout: fixed; width: 468pt;" class="redcator-table-advance"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">IT companies </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Change in the last one month </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">TCS </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-10.99% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Infosys </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-11.11% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">HCL Technologies </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-11.27% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Wipro </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-15.99% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Tech Mahindra </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-17.53% </td></tr></tbody><tbody></tbody></table>Source: BSE as on May 25 A study by Nomura reveals that 750 out of 2,000 global companies suggest a material slowdown in the overall financial performance in the upcoming quarters. The brokerage has downgraded some Indian IT company stocks along with target price. <table style="border-width: initial; border-style: none; table-layout: fixed; width: 468pt;" class="redcator-table-advance"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">IT companies </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Nomura rating </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Target price </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Current market price </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">TCS </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">From Neutral to Reduce </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹2,950 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹3,165 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Infosys </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">BUY </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹1,720 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹1,418 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">HCL Technologies </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">From Buy to Neutral </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹1,100 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹974 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Wipro </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">From Buy to Neutral </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹490 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹446 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Tech Mahindra </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Buy </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹1,350 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹1,064 </td></tr></tbody><tbody></tbody></table> SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/banks/news/indusind-bank-has-most-valuable-credit-cardholders-in-india-compared-to-hdfc-sbi-citi/articleshow/91784122.cms">The most valuable credit cardholders are not from HDFC, SBI, Citi or other major credit card companies</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="http://www.businessinsider.in/retail/news/biscuits-ghee-and-hair-oil-to-get-cheaper-after-government-duty-cut-but-after-three-months/articleshow/91784809.cms">Biscuits, ghee and hair oil to get cheaper after government duty cut — but after three months</a>

TCS, Infosys, Wipro and other IT companies' dream run could be over, say analysts

<a href="http://www.businessinsider.in/searchresult.cms?query=singapore&amp;sortorder=effectivedate">Singapore</a> has turned out to be one of the countries opposing foreign professionals working in its country. 
 
The number of <a href="http://www.businessinsider.in/searchresult.cms?query=Indian+IT+sector&amp;sortorder=effectivedate">IT professionals</a> working in Singapore has dropped after the government said it will conduct an "economic needs test" (ENT), which requires compliance with certain economic criteria. 
 
The visas for IT professionals to work in Singapore have dropped, leading the government to put on hold the review of the Comprehensive Economic Cooperation Agreement (CECA) citing violation of the trade pact. 
 
"They are doing it despite the CECA clearly stating that there will be no ENT or quotas on agreed services. This is a violation of the agreement," an Indian officer told TOI. 
 With protectionism stance growing in UK and the US, <keyword id="6357549" type="UNKNOWN" weightage="20" keywordseo="Indian-IT-companies">Indian IT companies</keyword> such as <a href="http://www.businessinsider.in/searchresult.cms?query=TCS&amp;sortorder=effectivedate">TCS</a>, <a href="http://www.businessinsider.in/searchresult.cms?query=wipro&amp;sortorder=effectivedate">Wipro</a>, <a href="http://www.businessinsider.in/searchresult.cms?query=cognizant&amp;sortorder=effectivedate">Cognizant</a>, L&amp;T Infotech and HCL, are relocating some of their operations to other countries in the region. 
 
"This (visa problem) has been lingering for a while but since early-2016, visas are down to a trickle. All Indian companies have received communication on fair consideration, which basically means hiring local people," Nasscom president R Chandrashekhar told TOI. 
 
Professionals do face such hurdles, especially in the services trade as countries insist on fulfilling various conditions, including ensuring that a local professional is given the first chance if he or she possesses the same or similar talent. 
 
(Image: Thinkstock)

More trouble? Another country has blocked visas for Indian IT professionals

<ul><li>Excerpts from interview conducted by <a href="https://www.businessinsider.com/author/joe-ciolli?IR=T" data-type="tilCustomLink">Joe Ciolli</a>, <a href="http://businessinsider.com/" data-type="tilCustomLink" target="_blank">Business Insider</a>.</li><li>The Indian government is hoping to stimulate the economy towards faster growth with the upcoming <keyword id="8192304" type="UNKNOWN" weightage="20" keywordseo="union-budget-2020">Union Budget 2020</keyword>.</li><li><keyword id="1422411" type="PERSON" weightage="20" keywordseo="Rajesh-Gopinathan">Rajesh Gopinathan</keyword>, CEO and MD of <keyword id="6357585" type="COMPANY" weightage="20" keywordseo="tata-consultancy-services">Tata Consultancy Services</keyword> (TCS) told Business Insider that he hopes that the government’s new measures won’t make foreign exchange prices more volatile.</li><li>A weakening rupee might help IT companies hedge in the short run, but a stable foreign exchange is a prerequisite for long run contracts.</li><li>He believes education, government, and healthcare are that the next three verticles ripe for digital growth.</li><li>TCS is also hoping that the insurance sector will get liberalised and follow in the footsteps of banking and financial services.</li></ul>Indian IT majors have a set of problems that are diametrically different from that of other domestic firms. Their growth story began in foreign countries, like the US, and though their domestic clients grew, international business is a major chunk of their revenue. Which means foreign exchange plays a big role in their fortunes. So, any move to ensure that India’s slowing economy is triggered will also strengthen the rupee, which is bad news for those who earn in dollars and euros. Crisis and stimulus “We’re quite comfortable with the policymaking in India for the last many years. Our only hope is that the current credit crisis and the stimulus don’t spike the foreign exchange prices,” Rajesh Gopinathan, CEO and managing director of Tata Consultancy Services (<a href="https://www.businessinsider.in/careers/news/tcs-plans-to-add-30000-freshers-to-its-ranks-to-reshape-its-cost-structure/articleshow/71524019.cms">TCS</a>) told Business Insider. At the same time, Gopinath hopes that the government would give impetus to three sectors — government, <a href="https://www.businessinsider.in/why-indias-health-budget-needs-more-infusion/articleshow/70082859.cms">healthcare</a> and <a href="https://www.businessinsider.in/niti-aayog-wants-education-budget-to-increase-further/articleshow/69941463.cms">education</a> — where technology implementation is at its lowest. Their growth and subsequent digitization will help IT companies build a robust domestic business. “They have not yet been properly revolutionized by technology, where the opportunity is huge and relatively untapped. They are still far behind,” he said. TCS also hopes that the <a href="https://www.businessinsider.in/business/news/life-insurers-bat-for-100-pc-foreign-investment-in-sector-via-automatic-route/articleshow/72874288.cms">insurance sector will get liberalised</a> and follow the example set by banking and financial services, which was one of the first sectors to be liberalised in the Indian economy. According to Gopinathan, “Insurance is still not liberalised. As the government is liberalising more, there is greater private sector investment and greater acceptance of technology and leverage.” After all, <a href="https://www.businessinsider.in/business/corporates/news/tcs-infosys-hcl-tech-and-wipro-shares-react-to-bfsi-slowdown/articleshow/73420055.cms">BFSI</a> is the biggest segment of TCS. Economic stimuli could make foreign exchange more volatile This budget, Finance Minister Nirmala Sitharaman is expected to announce a <a href="https://www.businessinsider.in/budget">slew of measures </a>to help stimulate the economy. India’s growth has dropped from 7% last year to <a href="https://www.businessinsider.in/policy/economy/news/international-monetary-fund-cuts-india-gdp-growth-estimate/articleshow/73441006.cms">4.8% expected this year</a>. Its fiscal deficit hit 114.8% of 2019-20 budget estimate according to Controller General of Accounts (<a href="https://www.businessinsider.in/business/news/fiscal-deficit-hits-115-of-budget-estimate-till-nov/articleshow/73049042.cms">CGA</a>) in November. Frequent stimuli and their effect on economic growth does not bode well for IT companies who rely heavily on outsourcing. It means currency markets turn volatile as do equity markets, which is extra bad news since international tensions are already playing a big part in currency fluctuation. “We want stability. For us, forex stability is the most important part of it,” said Gopinathan. In spite of the popular myth, a falling rupee is also not always good news for IT companies. Most IT majors hedge their foreign exchange earnings and they get into trouble when currency value dips or rises beyond the predictable band. In the long run, volatility and uncertainty are an obstacle. Of late, it is becoming tough for <a href="https://www.businessinsider.in/policy/economy/news/india-is-slowing-down-so-fast-that-even-experts-cant-keep-up/articleshow/72295703.cms">experts to predict </a>the Indian economy. <keyword id="6357549" type="UNKNOWN" weightage="20" keywordseo="Indian-IT-companies">Indian IT companies</keyword> will bear the largest impact of foreign currency fluctuations, especially when it comes to the dollar since nearly 70% of software exports land in the US. Education is ripe for disruption In addition to stability, TCS is also looking forward to exponential growth in the <a href="https://www.businessinsider.in/budget/news/education-budget-2020-the-rise-in-budget-allocation-for-education-is-just-not-enough/articleshow/73182288.cms">education sector</a> is the “most ripe for disruption”. “That ability to personalise education and to really switch on to life long learning as a concept we think is possible. And, it’s possible at scale,” he said. Over the past couple of years, TCS has observed that self-guided learning is increasing significantly. The company has been rethinking the role of schools and universities in terms of where knowledge comes from and what testing can achieve. If testing and knowledge acquisition shifts online and becomes tech-enabled, schools and college will be geared towards soft skills — like communication and values among others. “Directionally, the government is very focused on raising investments in education and research, which we believe is structurally required,” said Gopinathan. Healthcare is inefficient, says Gopinath While education is ready for change, <a href="https://www.businessinsider.in/budget/news/health-budget-2020-after-963-children-died-in-one-hospital-in-the-last-year-indians-will-be-watching-the-centres-allocation-to-upgrade-public-healthcare/articleshow/73169619.cms">healthcare</a> is one of the most inefficient industries — especially when it comes to data privacy. According to Gopinathan, solutions are available but legislation is yet to catch up. “Regulation needs to be designed for what it is seeking to achieve rather than justifying the regulatory bureaucracy,” he said. If there is a large-scale shift in mentality, the largest IT company in the country, will be able to gain a lot. After all, it is part of gigantic tech projects undertaken by the government and other industries. TCS has already been working with the government to digitise the passport system and citizen registry. It’s also worked on a project with the stock exchange, the State Bank of India and payments systems. “It’s an exciting market with its own challenges — not an easy market to operate in,” said Gopinathan. See also: <a href="https://www.businessinsider.in/tech/news/budget-2020-indias-mobile-phones-makers-fear-for-jobs-in-the-face-of-fewer-incentives-and-global-competition/articleshow/73261138.cms">Budget 2020: India’s mobile phones makers fear for jobs in the face of fewer incentives and global competition</a> <a href="https://www.businessinsider.in/budget/news/union-budget-2020-allocation-to-space-exploration-should-be-considered-a-seed-fund/articleshow/73665432.cms">Union Budget 2020: 'Allocation to space exploration should be considered a seed fund'</a> <a href="https://www.businessinsider.in/defense/news/indias-budget-allocation-for-defence-has-remained-fairly-static-for-the-past-five-years/articleshow/73153930.cms">Budget 2020: Five charts that explain what you can expect from India’s defence expenditure this year</a>

Exclusive: TCS CEO shares his hopes and fears from the budget 2020

<ul><li>The Chairman of <keyword id="46894" type="PERSON" weightage="20" keywordseo="Tata-Sons">Tata Sons</keyword>, <keyword id="292865" type="PERSON" weightage="20" keywordseo="Natarajan-Chandrasekaran">Natarajan Chandrasekaran</keyword>, has joined the list of international leaders like Bill Gates, Richard Branson, Narendra Modi, Priyanka Chopra and Kiran Mazumdar Shaw as a LinkedIn influencer. </li><li>He engaged over 62 million Indian users on the professional networking platform — majorly around the technological developments. </li><li>He was the CEO and managing director of IT major <keyword id="6357585" type="DOMAIN" weightage="20" keywordseo="tata-consultancy-services">Tata Consultancy Services</keyword> (<keyword id="6357150" type="ORGANIZATION" weightage="20" keywordseo="tcs">TCS</keyword>) for 30 years.</li></ul>The Chairman of Tata Sons, Natarajan Chandrasekaran, has joined the list of international leaders like Bill Gates, Richard Branson, Narendra Modi, Priyanka Chopra and Kiran Mazumdar Shaw — to become a LinkedIn influencer. Chandrasekaran, who joined <keyword id="6355725" type="ORGANIZATION" weightage="20" keywordseo="tata-group">Tata Group</keyword> as an intern in 1987 engaged over 62 million Indian users on the professional networking platform — majorly around technology developments. “Business opportunities, cutting across sectors, can be realised through engaging discussions and meaningful collaborations. The potential on the platform for continuous learning, experience sharing and lateral thinking is very exciting,” Chandrasekaran said. In his debut article, he highlighted how the shift from ‘shareholder capitalism’ to ‘stakeholder capitalism’ can help companies foster trust and inclusion. You don’t chase a title, you chase a dream: Chandrasekaran Chandrasekaran was the CEO and managing director of IT major Tata Consultancy Services (TCS) for 30 years. He told LinkedIn that he enjoys his profession, everyday. “You don't chase a title. You chase a dream. If you have an aspiration and a purpose and then you give it all you got, I think you'll be surprised. You will far exceed what you dream about,” Chandrasekaran said while talking about his achievements as a part of Tata Group. He also ran in the Tata <keyword id="45545" type="ORGANIZATION" weightage="20" keywordseo="Mumbai-Marathon">Mumbai Marathon</keyword> on Saturday. “I think there are days in which you feel more pressure. But most of my career, I felt that I’ve had a very enjoyable profession because my job at TCS for 30 years saw me learning a lot of technology and also meeting with different customers, industries, and traveling around the world,” he said. In his latest post, he talked about his upcoming book ‘‘Bridgital Nation’ — which revolves around emerging technologies and the country’s employment and economic crisis. “India is troubled by ‘twin challenges’. People want good jobs but don’t have the means to acquire them, and there are people in need of services that are out of their reach. He believes combining people with technology can be the best way to upskill and close the gap,” he told LinkedIn. He also talks on automation, employment scenario, and India’s economic situation. See also: <a href="https://www.businessinsider.in/business/corporates/news/tata-sons-challenge-nclat-order-that-reinstates-cyrus-mistry-as-its-chairman/articleshow/73066195.cms">Tata Sons hurries to challenge NCLAT order that reinstates Cyrus Mistry as deadline looms large</a> <a href="https://www.businessinsider.in/business/news/tata-sons-says-the-court-gave-cyrus-mistry-more-than-he-wanted/articleshow/72872657.cms">Tata Sons says the court gave Cyrus Mistry more than he wanted</a>

Tata Sons Chairman N Chandrasekaran has something in common with Bill Gates, Narendra Modi and Priyanka Chopra

Following are the top business stories of the day TCS Q3 net profit marginally up at Rs 8,118 cr: Country's largest software services major Tata Consultancy Services (TCS) on Friday reported a muted 0.2 per cent growth in consolidated net profit at Rs 8,118 crore for the third quarter ended December 2019. Iran, India can look at barter trade in agriculture: Mohammed Javad Zarif
Mumbai: Iran's Foreign Minister Mohammad Javad Zarif on Friday pitched for barter trade with India in the agriculture sector as well as setting up of Indian banks in the country which will also enable Iranian businesses to carry out transactions in rupee and rial.
 All foreign investments must adhere to law of the land: Goyal on Amazon row
Ahmedabad: A day after stating that Amazon was not doing any favour to India by investing one billion dollars, Union minister Piyush Goyal on Friday said the country welcomes all kinds of investments that follow the "letter and spirit" of the law. Rupee drops 15 paise to 71.08 against US dollar: The Indian rupee furthered its losses for the second day, dropping 15 paise to close at 71.08 against the US dollar on Friday amid strengthening of the American currency overseas and rising crude prices.
 INDIA
Amazon to create one million jobs in India by 2025, says Bezos: World's largest online shopping platform Amazon on Friday announced plans to create one million new jobs in India over the next five years as it firefights comments from Commerce Minister Piyush Goyal on the firm not doing a favour to the country by making the investments. Market ends flat; banks slide on NPA concerns after top court's AGR ruling: Market gauges Sensex and Nifty gave up early gains to close on a flat note on Friday as investors moved to the sidelines amid concerns that the Supreme Court ruling on telecom AGR issue might further aggravate stressed assets problem in the banking sector.
 Telecom dues: Curative petitions rarely admitted, say analysts: With just one week left for them to pay over Rs 88,600 crore in past dues, Bharti Airtel and Vodafone Idea are left with last legal remedy of filing a curative petition but such petitions are rarely admitted by the Supreme Court, analysts said on Friday.
 RBI should act as lender of last resort, provide liquidity to NBFCs: SBI: With difficulties in NBFC sector continuing, economists at SBI on Friday pitched for the Reserve Bank to play its role as the lender of last resort, something the central bank has avoided since the start of troubles in 2018.

DCM33 BIZ-2LD PIRAMAL-DRG
Piramal sells DRG business to Clarivate Analytics for USD 950 mn
New Delhi: Ajay Piramal-led Piramal Enterprises has signed an agreement for sale of its Decision Resources Group (DRG) business to US-headquartered Clarivate Analytics for USD 950 million (over Rs 6,745 crore), and will use the money to reduce debt and to explore organic and inorganic growth opportunities. 
 Vodafone Idea shares nosedive nearly 26 pc; m-cap drops by Rs 4,367 cr post SC order: Shares of Vodafone Idea on Friday plunged nearly 26 per cent after the Supreme Court dismissed telcos' plea seeking review of its earlier order asking them to pay Rs 1.47 lakh crore in past statutory dues by January 23.

Business Wrap: TCS Q3 Net profit up 0.2%, RIL Q3 net profit up 13.5% and other top business news of the day

<ul><li>Foreign portfolio investors owned $10.5 billion worth of shares of Indian insurance companies at the end of November 2019, up from just about a billion dollars at the end of October 2018.</li><li>Losing favour with the investors are Indian tech stocks like TCS, Wipro and Mindtree where prospects are looking bleak due to slower business and shrinking margins.</li><li>Private insurance players like Bajaj Allianz Life, Kotak Life, and Tata AIA Life clocked a 25.9% growth in <keyword id="168318" type="PERSON" weightage="20" keywordseo="insurance-premium">insurance premium</keyword> in November alone</li></ul>Foreign portfolio investors (FPI) ⁠— foreign investors who invest in shares and bonds ⁠— have been net buyers in the Indian market for three straight months at the end of November 2019, pumping in a total of $3.14 billion last month alone. More than half of that money has gone into buying shares in the banking and financial services industry. The country’s insurance companies have received the lion’s share of the inflows. At the end of October 2018, foreign investors had a billion dollars invested in Indian insurance stocks. At the end of November 2019, the exposure stands at over $10.5 billion, according to a report from Edelweiss Alternative Research. A lot of that money has come from the sale of technology stocks. 
 
 
 
 
 
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 The foreign investors’ bet on Indian insurance companies seems to be the right decision. The business growth for insurance majors spiked in November 2019. Private players like Bajaj Allianz Life, Kotak Life, and Tata AIA Life clocked a 25.9% growth in insurance premium in November alone, according to a research report from Emkay Financial Services. If someone waited for the data to buy these stocks, they had already missed a big bull run. 
 
 
 
 
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 “The market is extremely positive about the insurance sector, because growth here has been extremely strong over the next 10-20 years. On paper, these stocks may look extremely highly valued, but you need to look at them in the light of an extremely long growth runway that lies ahead,” Srinivasan Subramanian, MD for Investment Banking at Axis Capital, told a television channel ET NOW. 
 
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 Here’s why foreign investors are pulling money out of IT The prospect for India’s tech stocks is looking bleak. The business is slower and the margin is shrinking, with the exception of Infosys. <table style="width: 281pt;"> </colgroup> <tbody><tr> <td class="xl65" style="height:15.0pt;width:134pt">Company</td> <td class="xl69" style="border-left-width: initial; border-left-style: none; width: 147pt;">Margin compression</td> </tr> <tr> <td class="xl66" style="height: 15pt; border-top-width: initial; border-top-style: none;">TCS</td> <td class="xl70" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none;">-57 basis points</td> </tr> <tr> <td class="xl66" style="height: 15pt; border-top-width: initial; border-top-style: none;">Tech Mahindra</td> <td class="xl70" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none;">-40 basis points</td> </tr> <tr> <td class="xl66" style="height: 15pt; border-top-width: initial; border-top-style: none;">Mindtree</td> <td class="xl70" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none;">-89 basis points</td> </tr> <tr> <td class="xl66" style="height: 15pt; border-top-width: initial; border-top-style: none;">L&amp;T Tech</td> <td class="xl70" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none;">-26 basis points</td> </tr> <tr> <td class="xl66" style="height: 15pt; border-top-width: initial; border-top-style: none;">Cognizant</td> <td class="xl70" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none;">-34 basis points</td> </tr> <tr> <td class="xl67" style="height: 15.75pt; border-top-width: initial; border-top-style: none;">Infosys </td> <td class="xl71" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none;">+21 basis points</td> </tr></tbody></table>Source: Investec Securities The troubles are far from over. “We continue to expect continued pressures on revenue leading to decelerating revenue growth and PE (price to earnings) multiple contraction driven by weakness in BFS (banking and financial services) and retail. Amongst Tier-1s, TCS saw the biggest consensus EPS downgrade while Mindtree saw the biggest downgrade among Tier-2s in the last 3 months,” Investec Securities said in its December 4 report. <table style="width: 159pt;"> </colgroup> <tbody><tr> <td class="xl69" style="height:15.0pt;width:74pt">Stock</td> <td class="xl70" style="border-left-width: initial; border-left-style: none; width: 85pt;">One year Change</td> </tr> <tr> <td class="xl65" style="height: 15pt; border-top-width: initial; border-top-style: none;">HCL Tech</td> <td class="xl66" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none;">13.01%</td> </tr> <tr> <td class="xl65" style="height: 15pt; border-top-width: initial; border-top-style: none;">Tech Mahindra</td> <td class="xl66" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none;">6.97%</td> </tr> <tr> <td class="xl65" style="height: 15pt; border-top-width: initial; border-top-style: none;">TCS</td> <td class="xl66" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none;">6.17%</td> </tr> <tr> <td class="xl65" style="height: 15pt; border-top-width: initial; border-top-style: none;">Infosys </td> <td class="xl66" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none;">0.74%</td> </tr> <tr> <td class="xl65" style="height: 15pt; border-top-width: initial; border-top-style: none;">Wipro</td> <td class="xl66" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none;">-2.39%</td> </tr> <tr> <td class="xl67" style="height: 15.75pt; border-top-width: initial; border-top-style: none;">Mindtree</td> <td class="xl68" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none;">-11.98%</td> </tr></tbody></table> SEE ALSO: <a href="https://www.businessinsider.in/personal-finance/bharat-bond-etf-launch-is-the-best-tax-saving-plan-learn-how-to-buy-and-save-taxes/articleshow/72484444.cms" data-type="tilCustomLink" target="_blank">The best thing about Bharat Bond ETF is the tax benefit— especially for those in the highest income bracket</a> <a href="https://www.businessinsider.in/stock-market/news/boris-johnson-is-not-the-only-one-celebrating-a-possible-historic-majority-for-uk-conservatives-a-bunch-of-indian-stocks-are-thrilled-too/articleshow/72501071.cms" data-type="tilCustomLink" target="_blank">Boris Johnson is not the only one celebrating a historic majority for UK conservatives— a bunch of Indian stocks are thrilled too</a>

The amount of Indian insurance stocks foreign investors hold has grown ten-fold in just about a year

<ul><li><keyword id="10862" type="COMPANY" weightage="20" keywordseo="Wipro">Wipro</keyword> — the fourth largest IT services company in India — is planning to promote its 5,000 employees, thanks to the increasing attrition rate during the second quarter. </li><li>The company also rolled out a retention bonus of nearly ₹100,000 to its fresh campus hires. It also offered bonuses to employees with upto three years of experience. </li><li>Wipro added nearly 6,603 employees during the second quarter, taking the headcount to 181,453 from 174,850 in the last quarter. </li><li>The software major reported a net profit of ₹25.5 billion for the second quarter of 2019-20 fiscal. </li></ul>Wipro — the fourth largest IT services company in India — is planning to promote 5,000 of its employees, to check its increasing attrition rate. The technology giant recorded an attrition rate of 17% for the quarter ending in September. “Attrition (rate) has been a good story for us as compared to others. We have given salary hikes and now are looking at a huge number of promotions in the coming quarter. Around 5,000 people in the experience range of five to eight years will get promoted," Saurabh Govil, HR head, Wipro <a href="https://www.business-standard.com/article/companies/wipro-plans-to-promote-around-5-000-employees-to-check-attrition-119102100017_1.html">told </a>Business Standard. The company also rolled out retention bonus of nearly ₹100,000 to its fresh campus hires and those with upto three years of experience. “Junior-level attrition is slightly higher than the company average. However, it is lower among performers as they get higher bonuses, incentives and salary hikes," Govil added. While auto and textile sectors face troubled waters leading to job losses, the IT sector seems to be rebounding with a positive hiring sentiment. Wipro added nearly 6,603 employees during the second quarter, taking the headcount to 181,453 from 174,850 in the last quarter. The three IT giants — <keyword id="6357150" type="DOMAIN" weightage="20" keywordseo="tcs">TCS</keyword>, Wipro and <keyword id="6354512" type="COMPANY" weightage="20" keywordseo="Infosys">Infosys</keyword> — collectively hired 28,157 employees in the quarter ending September. This is a 59% jump from that of the June quarter, which recorded a net hiring of 16,687 employees, Businessline <a href="https://www.businesstoday.in/current/corporate/tcs-infosys-wipro-hire-28000-employees-september-quarter/story/385196.html">reported</a>. Wipro is also planning to hire more consultants so as to drive sales in the coming quarters. “We are hiring more people in this consulting space. It is paying us back, well," he said. The software major reported a net profit of ₹25.5 billion for the second quarter, registering a 35% growth as compared to last year. See also: <a href="https://www.businessinsider.in/thelife/personalities/news/top-10-tech-billionaires-on-the-forbes-list-of-100-richest-indians/articleshow/71539382.cms">Top 10 tech billionaires on the Forbes list of 100 richest Indians</a> <a href="https://www.businessinsider.in/changing-technology-and-financial-crisis-is-affecting-sustainability-says-a-un-report/articleshow/71307065.cms">Changing technology and financial crisis is affecting sustainability says a UN report</a> <a href="https://www.businessinsider.in/azim-premji-gives-more-the-charity-than-his-net-worth/articleshow/71306177.cms">India’s richest tech billionaire has given away more money than what he has right now</a>

Wipro is giving promotions and bonuses to check growing attrition

<ul><li>The first burst of quarterly earnings are out and six large companies HDFC Bank, Reliance Industries, TCS, Wipro, Infosys, and IndusInd Bank have declared their performance.</li><li>While the trend has been positive in all but one case, the management commentary has been negative in three companies.</li><li>HDFC Bank, the latest among the blue-chips to declare its earnings, lost over 3% in share value on Monday.</li></ul> Six companies from the Sensex list -- HDFC Bank, Reliance Industries, TCS, Wipro, Infosys, IndusInd Bank and Yes Bank -- have declared their quarterly earnings so far. <a href="https://www.marketsmojo.com/mojo/resultcorner?RefBse=1" data-type="tilCustomLink" target="_blank">Markets Mojo</a>, a gauge of the market mood on the website of the Bombay Stock Exchange (BSE), shows that the performance of four out of the six stocks are positive, the commentary around the prospects for these companies have turned down in three cases. 
	
	
	
	
	
	
 
 
 
 
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 Banks in a bind HDFC Bank, the latest among the blue-chips to declare its earnings, lost over 3% in share value on Monday. It was not just because the earnings were poor. Yes, the margin shrank a bit and the amount of bad loans rose but it was the pessimism in the management's commentary that did the stock in. “The tone of management commentary may spook the markets. However, it is still one of the best managed banks out there,” Jefferies said in its report. HDFC Bank has reported a 23% growth in revenue and a 21% rise in net profit compared to a year earlier. The rise in bad loans from farmers was offset by a spike in other income. IndusInd Bank, whose reported profit grew 38%, suffered from the fears of a spike in bad loans because of the company's exposure to the infrastructure lending giant IL&amp;FS that has gone bust. The IL&amp;FS crisis has cast a shadow of doubt on the entire financial sector in the country. 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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 The slump in demand for cars and two-wheelers, the lack of enthusiasm among home buyers, and spiralling consumer demand overall have dented bank earnings overall. Yes Bank's <a href="https://www.businessinsider.in/yes-bank-q1-earnings-report-yes-bank-share-price-q1-earnings-repor/articleshow/70261380.cms" data-type="tilCustomLink" target="_blank">quarterly profit between April and June 2019 fell 91%</a> compared to the same period a year ago, but it was still way better than estimates-- showing the lack of investor confidence. What propped up the stock on Monday were reports of a <a href="https://economictimes.indiatimes.com/markets/stocks/news/yes-bank-shares-rally-7-on-dhfl-deal-buzz/articleshow/70325293.cms" data-type="tilCustomLink" target="_blank">possible fund infusion</a> in the troubled housing finance company DHFL, to which Yes Bank has lent money. 
 
 
 
 
 
 
 
 
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 The elephant in the room The stock of Reliance Industries (RIL), one of India's biggest conglomerates, got a fillip on the first trading day after its earnings. But truly, the investors were just celebrating the fact that <a href="https://www.businessinsider.in/mukesh-ambanis-reliance-industries-profit-grows-6-8-even-as-gross-refining-margin-hits-the-lowest-in-18-quarters/articleshow/70294401.cms" data-type="tilCustomLink" target="_blank">the company's mainstay petrochemicals business</a>was not doing as badly as they had feared. That alone was enough to prop up RIL's share price by over 2% on Monday. The Mukesh Ambani-owned company has seen very good traction in its relatively new businesses like Reliance Jio and Reliance Retail but, as many analysts have pointed out, the core businesses petrochemicals and refining -- which make for the lion's share of the company's gross revenue-- are under threat. "Reduction in heavy crude oil supply post US sanctions, global refining capacity addition this year exceeding expected incremental demand, and slowdown in petchem demand as a result of the US-China spat will weigh on RIL’s refining and petchem business," a HDFC Securities report said. Tech: Tightrope walk India's top-tier software and IT service companies, TCS and Infosys, have had a bittersweet response from investors so far. The slowdown in TCS' revenue and profit were on expected lines, according to the broking house Motilal Oswal. But investors have been driven the stock down since the earnings despite the company <a href="https://www.businessinsider.in/tcs-plans-to-hire-18000-freshers-in-next-3-months/articleshow/70146189.cms" data-type="tilCustomLink" target="_blank">hinting at a double-digit growth</a> for the full year. 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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 Infosys did not have a standout quarter but the optimism in its outlook had investors upbeat. Infosys had projected a total growth 8.5% to 10% for the full year ending March 2020, which would imply a compounded quarterly growth 1.6% to 1.9%, according to a BOBCAPS research report. 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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 SEE ALSO: <a href="https://www.businessinsider.in/wipro-profit-growth-beats-tcs-and-infosys/articleshow/70262851.cms" data-type="tilCustomLink" target="_blank">Share buybacks and new deals are keeping the hopes up for Wipro's investors</a>

Six Indian blue-chip companies have declared earnings so far - most of them lack the 'markets mojo'

<ul><li>Tata Consultancy Services, India’s second most valuable company by market cap after <keyword id="6355199" type="COMPANY" weightage="20" keywordseo="reliance-industries">Reliance Industries</keyword>, just got hit with its second lawsuit in five years for alleged theft of “trade secrets”. </li><li>The company, which is the IT services arm of Tata, has been accused by the US-based Computer Services Corp (<keyword id="172156" type="CITY" weightage="20" keywordseo="CSC">CSC</keyword>) of improperly accessing the latter’s <keyword id="188405" type="ENTERTAINMENT" weightage="20" keywordseo="Source-code">source code</keyword> to develop an insurance platform. </li><li><keyword id="6357150" type="ORGANIZATION" weightage="20" keywordseo="tcs">TCS</keyword> was building the insurance platform in question for <keyword id="1884595" type="COMPANY" weightage="20" keywordseo="Transamerica">TransAmerica</keyword>, from which it received a $2 billion contract in January last year. That was, incidentally, TCS’s largest contract ever.</li></ul>Tata Consultancy Services, India’s <a href="https://www.google.com/search?q=tata+consultancy+services+market+cap&amp;rlz=1C1GCEU_enIN820IN820&amp;oq=tata+consultancy+services+market+ca&amp;aqs=chrome.0.0j69i57j0l4.7440j0j4&amp;sourceid=chrome&amp;ie=UTF-8">second most valuable company</a> by market cap after Reliance Industries, just got hit with its second lawsuit in five years for alleged theft of <a href="https://economictimes.indiatimes.com/tech/ites/tata-consultancy-services-faces-new-law-suit-over-trade-secret-theft/articleshow/69106238.cms">“trade secrets”</a>. The company, which is the IT services arm of Tata, has been accused by the US-based Computer Services Corp (CSC) of improperly accessing the latter’s source code to develop an insurance platform. In a response to ET, a TCS spokesperson said that the company’s legal team would respond to the allegations after reviewing them and that TCS would “strongly defend its position before the court”. TCS was building the insurance platform in question for TransAmerica, from which it received a <a href="https://www.tcs.com/transamerica-awards-tcs-multi-year-contract-third-party-administration">$2 billion contract</a> in January last year. That was, incidentally, TCS’s largest contract ever. CSC had licensed its Vantage and CyberLife softwares to a subsidiary of TransAmerica, Money Services Inc, for the administration of insurance and annuity products. The suit reportedly alleges that TCS misappropriated the code of these softwares, specifically the code which calculates the rate of return on products, to develop a platform for TransAmerica. Legal proceedings for the case will take place in the US state of Texas. While it is unclear the amount of punitive damages that CSC is seeking, a previous lawsuit filed against TCS might give an indication of the trouble the IT services major is in. In 2014, <keyword id="1378726" type="COMPANY" weightage="20" keywordseo="Epic-Systems">Epic Systems</keyword>, another US-based software provider, accused TCS <a href="https://economictimes.indiatimes.com/tech/ites/tata-consultancy-services-420-million-trade-secrets-case-moves-to-higher-court/articleshow/68554532.cms">of stealing its intellectual property</a>. The suit had alleged that TCS employees had stolen 6000 documents pertain to Epic’s methods of system development from a client that licensed the latter’s software - Kaiser Permanente. After two years of legal wrangling, TCS was asked to pay Epic $940 million worth of damages - which was later reduced <a href="https://www.tcs.com/update-epic-system">to $420 million </a>based on caps for such cases. TCS is currently in the process of appealing against <a href="https://economictimes.indiatimes.com/tech/ites/tata-consultancy-services-420-million-trade-secrets-case-moves-to-higher-court/articleshow/68554532.cms">the $420 million payment</a>. At the end of March 2019, the appeal was transferred to a federal appeals court in the US. The latest lawsuit didn’t seem to have much of an effect on TCS’s shares, which stabilised after <a href="https://www.google.com/search?q=tcs+share+price&amp;rlz=1C1GCEU_enIN820IN820&amp;oq=TCS+share+price&amp;aqs=chrome.0.0l6.1971j1j7&amp;sourceid=chrome&amp;ie=UTF-8">a 1% drop</a> this morning. SEE ALSO: <a href="https://www.businessinsider.in/india-post-upgraded-by-tcs-in-hopes-of-cutting-losses/articleshow/68989343.cms">The company that transformed India's passport offices is also working on post offices</a> <a href="https://www.businessinsider.in/tcs-wipro-and-hcl-are-among-the-worlds-most-valued-it-brands/articleshow/67670849.cms">TCS is now the world’s third most valued IT service brand</a>

One of India’s most valuable companies has been hit with a second lawsuit for improper use’ of a software provider’s source code

<ul><li>An India capital markets and investment group, CLSA, has said that hiring in the IT sector that grown for 12 successive months.</li><li>Hiring in Infosys and Tata Consultancy Services, two of the largest IT firms in India, increased 350% in FY19.</li><li>IT employment isn’t just growing in the tech sector but also in the non-traditional</li></ul> Among growing concerns around employment in India, CLSA — a capital markets and investment group — claims that hiring in information and technology (IT) sector is continuing to grow in double digits for the fourth consecutive month. 
 
 
 <div type="ExtQuote" text="Indian IT hiring grew for the 12th successive month and was up 38% YoY in Mar. This is the fourth successive month of double-digit growth." auname="CLSA said in a report"></div>







 The finding comes in the backdrop of an ongoing job crisis in the country in an election year during slowdown in job growth across all sectors. Nonetheless, two leading IT firms in India — Tata Consultancy Services (TCS) and Infosys — <a href="https://www.businessinsider.in/These-2-Indian-IT-majors-hired-more-than-42000-techies-in-fiscal-year-2019/articleshow/69000671.cms">reportedly</a> increased their hiring by 350% in FY19. The IT sector faced some troubled waters back in 2017, when tech firms all over India laid off around 56,000 workers allegedly due to digitisation and automation. A recent <a href="https://www.hindustantimes.com/education/five-million-jobs-lost-between-2016-18-says-report/story-9OsA2pHxyvto4qoiDUSLMI.html">analysis</a> by a research team at Azim Premji University painted a grim picture, saying over 5 million jobs were lost in India between the years of 2016 and 2018. The IT sector, nonetheless, seems to have turned a corner in the last two quarters. And, the Experis IT Employment Outlook Survey <a href="https://www.experisindia.com/outlook_survey.php">predicted</a> as much, expecting a positive net employment outlook of 53% between October 2018 and March 2019. But, the survey also pointed out how most of the employment will be generated by non-IT companies looking to transform digitally. As much as 45% of the demand for IT professionals would come from companies involved in utilities, finance, manufacturing and retail. The rapid evolution of machines and algorithms in the workplace could create 133 million new roles in place of 75 million that will be displaced between now and 2022, Even NASSCOM backed that claim with their own <a href="https://www.nasscom.in/newsline/envisioning-future-jobs">study</a> indicating how <keyword id="107950" type="TECHNOLOGY" weightage="20" keywordseo="artificial-intelligence">artificial intelligence</keyword> (AI), internet of things (IoT) and big data analytics would drive <keyword id="59516" type="PERSON" weightage="20" keywordseo="IT-hiring">IT hiring</keyword> in the future. And, while the change in the nature of IT jobs will create 133 million new opportunities, it will also result in the displacement of 75 million jobs by 2022 <a href="https://www.weforum.org/press/2018/09/machines-will-do-more-tasks-than-humans-by-2025-but-robot-revolution-will-still-create-58-million-net-new-jobs-in-next-five-years/">according</a> to the World Economic Forum. This phenomenon can be observed in India where the overall number of employees in the top two IT firms in India — TCS and Infosys — has increased, but the net addition per quarter has been dipping in the past two quarters. Even though, for FY19, hiring between the two has grown 350%. 
 
 
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 But, it’s not that jobs don’t exist — the problem is more about the growing skill gap that is indicative of a much more severe issue at an education level. Employers are looking to hire individuals for very specific tasks that require a specialised skill set meanwhile higher education institutes are still giving out generic and broad degrees. In October 2018, more than 50,000 data science and machine learning (ML) jobs were <a href="https://www.businesstoday.in/latest/trends/jobs-in-data-science-machine-learning-vacant-in-india/story/285446.html">vacant</a> in India. And, as companies look for highly skilled workers, the unskilled and low-skilled portion of the workforce will suffer further. Even when it comes to artificial intelligence (AI) there were <a href="https://www.businessinsider.in/india-has-a-booming-artificial-intelligence-sectorand-its-struggling-to-fill-over-4000-vacant-positions/articleshow/67154961.cms">reportedly</a> 4,000 vacant positions in December 2018 according to Analytics India Magazine study. Big data analytics is currently the ‘<a href="https://www.businessinsider.in/big-data-and-analytics-may-be-the-hottest-sector-but-india-has-a-serious-dearth-of-data-scientists/articleshow/66860305.cms">hottest</a>’ sectors in IT, but India only has fewer than 10% of data scientists available globally. LinkedIn estimates that the demand for big data professionals will only increase in the future, hitting nearly 40% over the next two years. The situation is already so severe that earlier this year in February, over 150 individuals with Masters in Business Administration (MBA) and engineering degrees <a href="https://www.businessinsider.in/in-india-mbas-and-engineering-graduates-compete-for-sanitation-jobs/articleshow/67866169.cms">applied</a> for the 14 available posts at the Sanitation Department in the south Indian state of Tamil Nadu.

You Searched For "tcs troubles" and got 12 results

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