India's IT services Cos. among most profitable
By agencies   |   Wednesday, 03 May 2006, 19:30 IST
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NEW DELHI: Indian Service vendors Cognizant, Satyam, Patni, TCS, Infosys, HCL Tech and Wipro were among the ten fastest-growing IT services vendors in the top 50 rankings in 2005, says a new research by independent market analyst Data monitor. Data monitor puts the size of the IT services market (including applications, infrastructure, consulting, and BPO services) at $513 billion in 2005, meaning that the 50 largest vendors claimed a share of 51 percent There was little change at the top of the rankings, with IBM, EDS, Fujitsu and Accenture again placed one to four, although BT Global Services overtook its German peer T-Systems to take eighth spot. However, India's five largest players all made significant moves up the league table, growing their combined sales by 35 percent to $9.3 billion. India's big IT services companies also ranked as the most profitable suppliers in the top 50 rankings in terms of both net and operating profit margin. This is due to the lower salary costs in India, which can be as much as 50 percent lower for some skills over comparable rates in the U.S. The research found that the world's 50 largest IT services vendors booked combined revenue of $262 billion last year, but grew at a slower rate than the overall market. The combined headcount of the top 50 vendors grew 18 percent to 1.58 million last year, driven by aggressive recruitment in India. The vendors, which ranged from IBM Global Services with sales of $47 billion to Patni Computer Systems with $450 million, increased their combined sales by 1.9 percent over the previous year. But this is well below the 8 percent growth in the overall market for external IT services. For the year 2006, the survey predicts more M&A activity that is likely to alter the very shape of the top 50 rankings.

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