Now that CTS has just announced their results for the quarter ending June 30, 2012, its time to take a re-look at the comparative positions of the Top 5 Indian players.
Cognizant has had an amazing quarter with 4.9% sequential QoQ growth (beating its guidance of 4.6%) which puts it in a different league among the Top 5 IT firms. Cognizant has overtaken Infosys and has attained the coveted number 2 position in the Indian IT industry. However it’s Operating Profits as a % of revenues is the lowest amongst the Top 5 players at 18.4% and its SG&A expenses is the highest amongst the Top 5 players.
The Indian IT firms can be classified into two categories:
1. Category A: CTS and HCL with their very high sequential QoQ growth of 4.9% and 3.1% respectively but at the same time having a much lower Operating Profits as a % of revenues at Sub 20% levels (18.4% and 19.4% respectively)
2. Category B: TCS, Infosys and Wipro with much lower revenue growth rates of 0.6%, -1.1% and -1.4% respectively but having higher Operating Profits as a % of revenues between 21-29%
The summary of the Q1 performance as per USD GAAP norms for Infosys, TCS, Wipro and HCL is as follows:
1. CTS leads in terms of QoQ Revenue growth at 4.9%, with HCL following at 3.1% and TCS, Infosys and Wipro trailing at 0.6%, -1.1% and -1.4% respectively
2. CTS leads in YoY Revenue growth at 20.9% with HCL following at 12.2% and TCS, Wipro and Infosys trailing at 10.5%, 7.6% and 4.8% respectively
3. HCL leads in terms of QoQ Operating Profits growth at 27.4% with CTS following at 4.4% and TCS, Wipro and Infosys trailing at 2.3%, 0% and -7.4% respectively
4. HCL leads in terms of YoY Operating Profits growth at 40.3% with CTS following at 22.6% and TCS, Infosys, Wipro trailing at 18.9%, 12.4% and 2.2% respectively
5. TCS leads in terms of Operating Profits as a % of revenues at 28.2% with Infosys closely following at 27.9% and Wipro, HCL and CTS trailing at 21%, 19.4% and 18.4% respectively
6. CTS leads in terms of SG&A expenses as a % of revenues at 22.1% with TCS closely following at 19% and HCL, Infosys trailing at 13.2% and 11.6% respectively
Parameter
|
Infosys
|
TCS
|
Wipro
|
HCL
|
CTS
|
Q1 Revenues(M USD)
|
1752
|
2664
|
1514
|
1079
|
1795
|
QoQ Growth
|
-1.1%
|
0.6%
|
-1.4%
|
3.1%
|
4.9%
|
YoY Growth
|
4.8%
|
10.5%
|
7.6%
|
12.2%
|
20.9%
|
Q1 Operating Profits(M USD)
|
489
|
750
|
318
|
209
|
331
|
QoQ Growth
|
-7.4%
|
2.3%
|
0.0%
|
27.4%
|
4.4%
|
YoY Growth
|
12.4%
|
18.9%
|
2.2%
|
40.3%
|
22.6%
|
As % of Revenues
|
27.9%
|
28.2%
|
21.0%
|
19.4%
|
18.4%
|
Q1 Net Profits(M USD)
|
416
|
610
|
NA
|
155
|
251
|
QoQ Growth
|
-10.2%
|
4.3%
|
NA
|
28.1%
|
3.3%
|
YoY Growth
|
8.3%
|
13.4%
|
NA
|
36.0%
|
20.6%
|
As % of Revenues
|
23.7%
|
22.9%
|
NA
|
14.4%
|
14.0%
|
SG&A Expenses
|
204
|
507
|
NA
|
142
|
396
|
As % of Revenues
|
11.6%
|
19.0%
|
NA
|
13.2%
|
22.1%
|
*Wipro does not give P&L for Global IT services separately. There is a single P&L for Wipro Limited
