Investor Presentation

Transcription

1 Investor Presentation January 2018 Copyright 2017 Tata Consultancy Services Limited

2 Forward Looking Statements Certain statements in this release concerning our future prospects are forward-looking statements. Forwardlooking statements by their nature involve a number of risks and uncertainties that could cause actual results to differ materially from market expectations. These risks and uncertainties include, but are not limited to our ability to manage growth, intense competition among Indian and overseas IT services companies, various factors which may affect our cost advantage, such as wage increases or an appreciating Rupee, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, restrictions on cross-border movement of skilled personnel, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which TCS has made strategic investments, withdrawal of governmental fiscal incentives, political instability, legal restrictions on raising capital or acquiring companies outside India, unauthorized use of our intellectual property and general economic conditions affecting our industry. TCS may, from time to time, make additional written and oral forward-looking statements, including our reports to shareholders. These forward-looking statements represent only the Company s current intentions, beliefs or expectations, and any forward-looking statement speaks only as of the date on which it was made. The Company assumes no obligation to revise or update any forward-looking statements. 2

3 Tata Consultancy Services TCS is an IT services, consulting and business solutions company, offering transformational and outsourcing services to global enterprises Global Presence: 227 Offices in 49 countries and 141 Solution Centers in19 countries Started in 1968, TCS is part of the Tata Group, known for its values, integrity and management excellence Employer of Choice, No. of Employees over 390,880 FY 2017 (ending March) revenue US$ Bn Amongst the Top 10 Global IT Services providers 3

4 Mar-05 Mar-07 Mar-09 Mar-11 Mar-13 Mar-15 Mar-17 FY05 FY07 FY09 FY11 FY13 FY15 FY17 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 REV IN USD MN EPS IN ` The Journey so far $20,000 $10,000 Industry-leading top-line growth with superior profitability $0 0 Judicious usage of cash 34% 47% 3% FY05 to FY17 16% Dividends Paid Capex Acquisitions Invested Funds and higher-than-benchmark share performance TCS BSE IT 884% 416% 4

5 Leading Technology Change

6 Leading through 50 Years of Enterprise Technology Automation Y2K Factory Industry 4.0 Devices Digital Cypto Security, Privacy MES, M2M BYOD Groupware, Apps, Smartphone RPA Cyber Sec, Identity, Blockchain IoT, Robotics Drones, Cyber-Physical Wearables, Bionics Collaboration, Social, Touch Interaction, Design, AR/VR Cognitive Automation, AI, Intelligent Agents 1970s 1980s 1990s 2000s 2010s Compute Data Applications Applications Development Mainframes, Unix, VAX, AS/400 DBMS, RDBMS Material Resource Planning COBOL, Object Oriented Windows 95, Linux Warehouses ERP, HRMS, CRM, FS, BPS Client/Server, Thin Client Virtualization Grids BI, Marts, NoSQL SaaS Cloud, Edge, Fog, Mist GPU, FPGA Pervasive, Personal Big Data, Analytics, Data Monetization SoA, Agile PaaS, BPaaS, Products & Platforms APIs, DevOps 6

7 Digital Transformation Offerings Reboot customer experience with interactive technologies, and cognitive service operations Experience Consulting & Services Integration Enterprise Agility, M&A / Divestitures, Finance & Shared Services, CX Front Office Transformation, SCM as a Service, Next Gen Transformation, Digital Integration Digital Interactive Commerce, Channels, Marketing, Engagement Enterprise Intelligent Automation Infra, Application, Process, Test Deliver insights with Integrated Analytics from multiple data sources Re-imagine core processes with new enterprise Cloud platforms and extensions coupled with process design Intelligence Digital Core Analytics & Insights Business Analytics, Data Services Enterprise Application Services SAP, Oracle, MS, Salesforce Cloud Apps, Micro- Services & API Cyber Security I&AM, GRC, Forensics IT Infra Services & TCS Cloud Public, Private & Hybrid Cloud Business Process Services Domain & Enterprise Services, BPaaS Blockchain Advisory & Ideation, Business Consulting, Value Demonstration IOT Connected Devices, Industry 4.0, Smart City, Digital Twin, Managed Services Quality Engineering & Transformation Process, Performance, Agile 7

8 Embracing Agile at Scale Market Success Execution Capability 700+ Clients using agile methods 100+ Large scale agile adopters Agile engagements 300+ Large programs 80+ Transformational programs 300,000+ person years of agile experience 80,000+ Agile practitioners 10,000+ Externally certified 7,000+ Scrum Masters 2,000+ SAFe Certified Leaders 1,000+ Agile consultants & coaches 60+ SAFe SPCas 156,000+ Agile trained associates US Home Supplies Retailer Leading Cargo Handler Time to market 90% reduction Product Quality 30% improvement Time to market 90% reduction Product Quality 30% improvement Agile Assets External Visibility Agile Workspaces Agile Ready Teams Customer Engagement Australian Bank Large US Financial Services Co Time to market 65% reduction Product Quality 80% improvement Time to market 20-50% reduction Product Quality 60% improvement 8

9 Scalable Reskilling using the Digital Learning Platform Access Anytime, Anyplace, Any device Content Rich & Expanding Crowd sourced faculty Delivery Domain-infused, Culture focused, Gamified Infrastructure Analytics and Insights Mobility, Digital Marketing Cloud IOT & Cyber Security Cloud based, Immersive and Virtual FY 17: 215k employees trained in Digital 598k+ competencies acquired 9

10 Investments in Design Capabilities Design Studio, Santa Clara Executive Briefing Center, Mumbai Unique, immersive, shared spaces that bring new ideas to the fore Physical presence 20 DESIGN STUDIOS & LABS 11 INNOVATION CENTERS DISTRIBUTED AGILE 13 ENGINEERING CENTERS 35+ Design / Mktg Awards 10 People Design, content, and technology Industry and domain Best-in-class lateral hires Academia collaboration Partners Partner-led growth strategy Joint go-to-market Multi-partner ecosystems Process & toolchain Ideation-to-consumption Integrated collaborative toolchain bringing together design, strategy, engineering, customers and users

11 Focus Areas for Research & Innovation Foundational Research Automation Software Systems, Physical Sciences, Life Sciences, Behavioural-Social-and- Business Systems Data and Decision Sciences, Enterprise Intelligent Automation, Cyber Physical Systems BFS Frictionless Experience Insights & Automation Disintermediation Reg-Tech Security Retail Immersive & Connected Customer Engagement Intelligent Merchandising & Store Operations Governance Sustainability Compliance, Enterprise Security, Risk, Data Privacy Energy, Agriculture, Urban Challenges Life Sciences Personalized Medicine Simplification Enterprise Automation Manufacturing & Industrial Digital Mfg &Ops Value Chain Re imagination Safety AI Image & Speech Recognition NLP/NLG Augmented Reality Speech Biometrics Cognitive Automation 11

12 Portfolio of Intellectual Property Technology Products & more Horizontal Products & Platforms CHROMA Integrated Urban Exchange Customer Intelligence & Insights TAP - TCS Accounts Payable & more Vertical Products & Platforms Assessment TCS ADD TCS HOBS & more 3,359 patent applications to date, 478 patents granted till date 12

13 Co-innovating with the Startup Eco-system GEOGRAPHY TECHNOLOGY VERTICAL 2,029 Visibility Investor Portfolio Events, Meetups Demo days Hackathons Conferences, Forums Customer Innovation Partner Innovation Publications TCS BU Requests 702 Validation TCS Horizontals and Vertical BUs Customer BUs 76 Valuation Joint Go to Market Strategic Alliances USA, APAC Robo Advisory BFS USA Data Streaming BFS USA FX Payments BFS USA Visual IVR BFS USA AI - Data Enrichment BFS, CPG USA Big Data CPG USA Home Automation INS UK Cybersecurity MFG India AI - Fraud BFS India ChatBots BFS India Payments BFS India Data Digitization MFG India Big Data Analytics Retail, CPG Europe DB Devops BFS Europe NLG INS Europe Language Translation MFG Australia Test Automation BFS APAC Gamification Telecom 13

14 Alliances and Partnerships Automation & AI Smart Workflow Robotic Process Automation Cognitive Intelligence Others Machine Learning / NLP / NLG Cloud IoT Big Data Analytics Digital Interactive 14

15 Gaining Leadership in Digital 3Q18 Digital Revenue: 22.1%, growing at 39.6% YoY Partnering 55% of Clients in their Digital Journey Signed largest ever Digital deal till date of $50 Mn+ Leadership Rankings in 21 competitive assessments in Digital areas (FY17) IoT (5) Big Data & Analytics(5) Digital Services (4) Mobility (3) Digital Marketing (2) Cloud (1) 15 Cyber Security(1)

16 Longer Term Growth Strategy

17 Customer Centric Model Deep domain expertise Contextual knowledge Innovation focus and IP Full Services Capability Agile, Global Delivery Differentiated, bespoke solutions Time to Market Greater predictability Superior Outcomes More Repeat Business Wider footprint Enduring relationships Relationship Orientation 17

18 North America UK & Europe APAC & India MEA & LatAm Going Deeper, Casting Wider New Clients, New Markets. BU 1 BU 2 BU 3 BU 4 BU 23 BU 24 New Industry Vericals Consulting & Service Integration New Service Offerings Digital Transformation Services Digital Interactive Enterprise Apps Cloud & Cloud Apps IoT, Analytics & Insights Intelligent Automation Cyber Security Cognitive Business Operations Business Process Services IT Infrastructure Services 18

19 Going Deeper, Casting Wider: A Case Study Large Retail Client in UK 19

20 Going Deeper, Casting Wider: Business Outcomes Large Client Metrics Rev in USD Bn US$ 20 Mn+ US$ 50 Mn+ US$ 100 Mn New clients New services Same clients, same services FY12 35 FY17 FY 11 FY 16 20

21 Going Deeper, Casting Wider: Financial Outcomes Revenue per capita ($ cc) Net Income per capita ($) 42,630 51,896 9,319 11,394 FY12 FY12-17 FY12 FY

22 Cash Flow Cash Conversion OCF to Net Income 102.7% Free Cash Flow USD Mn $3,732 Free Cash Flow/ Enterprise Value 5.6% 68.9% $1, % FY12 FY17 FY12 FY17 FY12 FY17 22

23 Strong Capital Allocation Average Payout FY14-FY18 YTD : 80% 23

24 Structural Growth Drivers Consolidating market >> Scale providers gaining market share Emerging Markets catching up in Technology adoption>> Expanding global spend IT is a source of competitive differentiation >> Rising technology intensity of businesses Shortening Tech shelf-life >> Greater propensity to outsource 24

25 Annexure

26 Latest Earnings Financial Highlights IFRS USD Mn Yearly Quarterly FY17 FY16 YoY 3Q18 3Q17 YoY Revenue - CC $17,918 $16, % $4,659 $4, % Revenue - ` Mn 1,179,660 1,086, % 309, , % Revenue - USD $17,576 $16, % $4,787 $4, % Gross Profit $7,611 $7, % $2,020 $1, % Gross Margin 43.3% 43.9% (64 bps) 42.2% 43.2% (100 bps) Operating Income $4,518 $4, % $1,205 $1, % Operating Margin 25.7% 26.5% (80 bps) 25.2% 26.0% (80 bps) Net Income $3,917 $3, % $1,012 $1, % Net Margin 22.3% 22.3% (0 bps) 21.1% 22.9% (180 bps) EPS in ` % (0.8)% 26

27 Thank You You