TCS APAC is still a young business vis-à-vis the company’s business in traditional western markets. Currently we have 7,500 associates in 13 countries of APAC and the company generates over 6 per cent of TCS revenue.
We have two types of customers — global Fortune 500 MNCs from North America and the EU, as well as large local companies that are going regional or global (these we term as national champions). Roughly two-thirds of our revenues come from such national champions now; previously, the bulk of revenues came from global MNCs.
TCS APAC has been growing at over 30 per cent CAGR over the last six years with good margins. For the year ending March 2010, TCS APAC had revenues of nearly $350 million.
What signs of revival is the region showing? How do growth margins compare with those of western markets?
Margins overall in the Asia Pacific region are good and, in many cases, equal to what we see in traditional markets. In some countries such as China, the margins are somewhat lower.
Are Australia, New Zealand (ANZ) a significant market for TCS?
Asia Pacific is a multicultural, multi-regulatory region. Is doing business in this region different from doing business in say, Europe or the US?
We also work with countries at different stages of development, namely highly-advanced economies such as Japan and ANZ, global financial hubs such as Hong Kong and Singapore and newly-developing countries such as Malaysia, the Philippines and Thailand. In addition, we have the fastest-growing nation in the world, China, whose growth is fuelling growth globally.
We are seeing growth in Hong Kong, some parts of ASEAN and, of course, ANZ. The challenge is to move faster in the big, non-English speaking markets of Japan and China, where the presence of Indian companies is still small. Another important aspect is that outsourcing is not as widespread as it is in western markets. That makes TCS APAC rather unique within TCS.
Tell us about TCS APAC’s academic tie-ups in the region.
A few years ago, TCS APAC partnered with Nanayang Tech University in Singapore on a joint R&D project. The solution so jointly created was then sold to our western clients.