BANGALORE: Riding on robust business growth from across geographies, Tata Consultancy Services (TCS), India’s largest IT services firm, on Friday said it is getting higher pricing for new outsourcing contracts and renewal of existing engagements from its customers.
“We are getting new contracts at 3% to 5% higher prices than existing contracts. When you look at contract renewals, we are getting them at the same higher prices,” TCS CEO S Ramadorai said, but declined to forecast change in revenues or specify contracts up for renewal.
While the contracts of several customers will come up for renewal, TCS is waiting for renewal of the contract of its largest customer, General Electric, which contributes nearly 9% of its total revenue.
“The GE contract is coming for renewal at the end of the year, by December 2006. New contracts will come in place from January 2007,” Ramadorai said. He admitted that GE is known for driving down contract costs on huge volumes.
GE was one of the first major American companies to outsource work to India and also set up a huge captive BPO unit, in which it sold 60% stake two years ago.
TCS, which aims to scale up in China to over 5,000 in four years, is bidding to implement its FNS core banking solution for banks in the middle kingdom and hopes to finalise a few deals soon,” TCS vice-president and head, banking industry practice N Ganapathy Subramaniam said. It will recruit a net of 30,000 people this year.
TCS has already made an entry into the highly-regulated Chinese banking sector with a contract from retail bank Hua Xia Bank early this year. It had acquired Sydney-based FNS for $26 million in November last year.
Ramadorai said the firm will hire a net of 30,000 people this year and has made offers to over 8,710 freshers to be inducted in financial year 2007-08.
