Rank-1 : TCS : A Global Brand
With a total revenue of more than $70 bn close to hundred operating companies, and presence in more than eighty countries, the Tata Group is Indias most well-known name in business. It is also Indias most well-known global brand; in fact, close to two-third of its group revenue comes from outside India.
Information Technology (excluding telecom) accounts for close to 10% of the total revenue of Tata Group. It accounts for an even higher share of the groups international revenue. In fact, the only two businesses that are bigger than IT are its traditional businessesmaterials and engineering.
As much as five of the IT companies from the Tata Group feature in the DQ Top 250 companies. While it is led by TCS, at #1, another group company, Tata Technologies too features among the Top 50 IT companies in India. The others which are profiled and analyzed by Dataquest include Tata Elxsi, Tata Interactive and Nelito Systems. A company that, in pure revenue terms, should have featured but has not been profiled by Dataquest, because of the fact that it is majority owned by TCS, is CMC, a separate listed entity that used to be a public sector entity a few years back. In fact, if TCS pioneered IT services exports out of India, CMC pioneered the services and systems integration market within Indiathough it was largely restricted to government projects. Till date, it continues to be one of the biggest services player in the government space.
| Rank - 1 : Tata group | |
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 | Ratan N Tata, chairman, Tata Group |
| TCS still accounts for the lions share of the revenue. But increasingly, others are establishing themselves as specialists in areas such as engineering, design, and learning | |
The Tata Group has not traditionally been known for close cooperation among group companies, largely because of its fairly loose federated structure and the fact that unlike many family owned companies, professional managers actually ran the Tata Group companies. So, the corporate mandated cooperation was not really there. The only thing the group strictly reinforced is sharing of certain common values. There was very little leverage of each other on the ground, when it comes to actual business.
The IT business, initially, was no exception. But in the last few years however things have been different. Interestingly, it is less of corporate mandate (though that has also been there) and more of a market reality that has prompted the entities to leverage each other.
The leverage has been multi-faceted. At the most basic levels, it entails the serving of key executives of companies in each others boards, so as to gain from their experiences. It also means using the expertise of each other at the back-end creating a better (sometimes more end-to-end) solution for the customers. A more evolved approach of this is a joint go-to-market. Using group companies for procuring products and services is yet another approach. Fairly recent approaches have been leveraging the Tata brand more effectively. And finally, minimizing overlaps. While the last is still not publicized and openly mandated, we will not be surprised if that kind of rationalization happens in a big way in the next few months.
Serving of key people in different companies boards is nothing new. S Ramadoai, the chairman and ex-CEO of TCS has been serving as the chairman of not only its subsidiary CMC, but also as the chairman of Tata Technologies since 2001. In September 2009, he was also appointed as the chairman of Tata Elxsi. So, in effect, Ramadorai serves in the boards of the three largest IT companies in the group. Patrick McGoldrick, the MD of Tata Technologies, is also in the board of Tata Elxsi. These executives help in ensuring that at the broader strategic level, there is leverage of each other.
The cooperation on the ground is a fairly recent phenomenon. And it is not restricted to just intra-segment cooperation. The engineering design division of TCS as well as Tata Technologies are now leveraging the trend of many customers looking at end-to-end outsourcing of product developmentfrom concept to manufacturing. Three years back, TCS roped in TAL Manufacturing Solutions to deliver a product to an Italian aerospace company. It designed and project managed the development of a tool while TAL did the manufacturing. The client got an end-product at a competitive rate. Now there are multiple instances of this trend manifesting itself which TCS and Tata Technologies are trying to leverage. In case of JLR, now a Tata company, TCS, Tata Technologies as well as Tata Elxsi, all have worked on different projects. In case of another large automaker, TCS and Tata Technologies actually proposed swapping of the deal between themselves and the client saw the rationale. A project from ArvinMeritor was won jointly by the two companies.
Leveraging the Tata brand is something that these companies are doing more consciously now. Take the example of Tata Technologies. It started as a subsidiary of Tata Motors to focus on the engineering IT and engineering design work of the parent. Soon it realized the potential of going third party. But at that time, few were interested in coming to an Indian company for engineering complex products. So it acquired INCAT, an established engineering design company overseas. While the company was still called Tata Technologies, it started branding itself as INCAT. But with Tata Nano making headlines, brand India and brand Tata had suddenly arrived in the world engineering scene. It decided to go back to Tata brand a year back. And since it had worked on the Tata Nano, now it has even developed a framework, which is a standardized approach to value engineering. Called Tata Innovation Value Framework (TIVF), the company is going to market with this framework. When the engineering world is so enchanted by the charm of frugal engineering (see analysis of engineering services exports), it seems a potential winner.
Also, Tata Elxsis Visual Computing Lab has worked on all the advertisements of Tata Indigo Manza, for all markets. And this has been an internal mandate.
While the group has still not made any public comment on rationalizing the offerings, there is a seemingly conscious effort to achieve that, to an extent. Ramadorai, after taking over as the chairman of Tata Elxsi, has been fairly active in finding out which are the areas that the company should pursue aggressively and which are the areas it can vacate, especially as the company targets to grow to Rs 1,400 crore in the next three years. He has focused on restructuring the companys business, actually shedding areas that were unprofitable. It has already exited the traditional IT services space and is focusing on product design creating IP. While TCS and Tata Technologies work on the left-brain things, Visual Computing Lab of Tata Elxsi would continue to expand its strength and reach in the right brain design. As the product design space sees more complete outsourcing, a studio to design a product would tremendously add to the engineering capabilities of Tata Technologies and TCS.
In addition, other Tata Group members are being encouraged to use TCS and CMCs services in IT.
Rank - 2 : Wipro : India Shows the World
How times change. A 5% growth a few years back would have sent the Wipro management and analysts into a tizzy. In FY10 however, both tacitly acknowledge that Wipro has now reached a scale where those days of high double-digit growths are over. This was true of both TCS and Infosys too (they recorded even lower growth); it might sound paradoxical, but low growth now means that the Big Three are really BIG, globally too. For Wipro JFM FY09 was one of the worst quarters in its history. Things started improving from JAS FY09 onwardsinitially growth was pricing driven, followed by volume growth in subsequent quarters. Wipros prescription to stave off the recessionary challenges in FY10 was not much different from its Big Three peers. Higher utilization, offshore component increasing from 47% to 50% and fixed price projects accounting for 41.5% of its revenues, up from 34% in FY09. Both the geographical and vertical mix were equitable enough to stand Wipro in good stead.
However, a challenging FY10 seemed to have an impact on Wipros mega and gamma strategy that had failed to take off in the manner expected. Neither did Wipro manage to add too many $50 mn or $100 mn clients (barring exceptions like Origin Energy or Morrisons) during this period, nor did the contribution from its top 10 clients go up. The top 10 accounted for 19% of Wipro revenues with the top client contributing 2.5%--contrast these with TCS (30% and 8.2% respectively) and Infosys (26% and 4.6% respectively). What this emphasized was Wipros inability to mine client accounts effectively; it was also an effect of the sales team and project delivery team working on a particular client account, not reporting to the same person. While the joint CEO strategy has worked wonders, the plan might need some revisions down below to address these anomalies.
| Rank - 2 : Wipro | |||
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 Suresh Vaswani, joint CEO |  Girish Paranjpe joint CEO | Laxman K Badiga, CIO Suresh Senapaty, CFO KR Lakshminarayanan Ian, Chief Strategy Officer | HIGHLIGHTS
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| FACTSHEET l Start-up Year: 1981 l Products & Services: IT services, product engineering services, technology infrastructure services, consulting services, BPO l Address: Doddakannelli, Sarjapur Road, Bangalore - 560 035 l Employees: 108071 l Tel: 080 2844 0011 l Fax: 080 2844 0214 l Website: www.wipro.com | |||
Unlike its big three peers though Wipro was miles ahead on the domestic market. More than $1.2 bn in Indian revenues only, Wipro Infotech seems to specialize on those complex transformational deals. Uninor, Delhi International Airport, Lavasa, Employee State Insurance, Punjab & Sind Bank, a turnkey Finance Ministry project are Indian deals that are now becoming references for Wipros global market.
Rank - 3 : Infosys : Trying Times
FY10 was the first full year Infosys completed operations since its inception three decades back with neither Narayana Murthy nor Nandan Nilekani involved in any official functioning capacity. This unfortunately coincides with one of the lowest growths Infy has ever recorded. Net profits and operating margins too dipped by 1% and pricing declined by 4%. Blame it on extreme volatility in currency or the recession, FY10 would definitely not be remembered with pride in the Infy annals. But, ultimately, Infy has done the most to build Indias brand equity in IT services globally (even more than TCS and Wipro who had an older lineage). Infys share of fixed-price component of the business increased from 38% to 41%, SG&A decreased from 6.3% to 5.9% and even the offshore component increased by one point; it added 141 new clients including eleven $1mn clients, six $50 mn clients and two $100 mn clients. The IP cell of SETLabs filed 31 patents in US and India.
Infosys focused on expansion, emphasizing on building a larger workforce in anticipation of more outsourcing orders. The fact that emerging nearshore rivals were gaining steam, sort of forced its hands. That perhaps explains that even amidst a hit on topline, bottomline and operating margins, Infosys increased wages by 16% in India and by 3% overseas.
| Rank - 3 : Infosys | ||
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 | S. Gopalakrishnan, CEO TV Mohandas Pai, director SD Shibulal, COO & director V Balakrishnan, CFO K Dinesh, director, Srinath Patni, director | HIGHLIGHTS
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| FACTSHEET Start-up Year: 1981 l Products & Services: IT services, IT products, BPO, consulting l Address: Plot No. 44 & 97A, Electronics City, Hosur Road, Bangalore 560 100 l Employees: 1,13,796 l Tel: 080 2852 0261 l Fax: 080 2852 0362 l Website: www.infosys.com | ||
H1FY10 was particularly depressing for Infosys when a fragile US economy had serious impact on growth and pricing. The turnaround started happening Q3 onwardswhich witnessed a 3% q-o-q increasewhile Q4 saw a 4% increase over Q3. While that coincided with the improving signs of the economy, Infosys started finding increasing takers for its IP-based solutions, and that helped it achieve a better margin. A health insurance major bought the iTransform product suite, a CPG major deployed the Procurement module of its Supply Chain Visibility suite even as Infy launched its mobile application platform, Flypp. Despite media hype, the domestic story did not gather steam barring deals like eBiz project from the Ministry of Commerce & Industry.
Rank - 4 : HP India : The Queen is Back
HP India is perhaps the most heterogenous company in the DQ Top20 roster. This had proved to be a detriment in FY09 when a stupendous performance in the enterprise business was offset by the dip in fortunes for the PSG and IPG businesses. Things improved in FY10services gained further momentum, but there was a turnaround in the fortunes of the other two businesses too leading to overall growth.
It was again a services story for HPwithin the enterprise business, services grew at 29%, more than double the rate of enterprise products at 13%. There was a perceptible shift from product-based to services-led deals, with particular traction in manufacturing, automotive, BFSI and the public sector. Seems the EDS integration paid grand dividends for HPs services in India. Meanwhile HPs leadership in x86 servers continued. In JFM alone, it grew by 44% y-o-y. Even the G6 and ProLiant G7 servers launched in FY10 bolstered its market share. Though the storage market share dipped, the HP networking business (formerly ProCurve) started picking upthe 3Com acquisition should help it gain further grounds and pose a serious challenge to Cisco. With converged infrastructure high on HPs agenda , the Blade System Matrix was launched in FY10; HP bagged customers including Essar Group and Sify.
There was revival on the PSG and IPG front: the consumer PC distribution model was revampedfrom national distribution to regional distribution. What also helped was Sunil Dutt replacing Ravi Swaminathan as the PSG headthis model was followed by mobile companies like Nokia and Samsung where Dutt had worked earlier. The divisional restructuring of PSG into Emerging Businesses, IDC and Attach, Desktops and Mobility further bolstered this strategy.
| Rank - 4 : HP India | ||
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 | Neelam Dhawan, MD Rajiv Srivastava, COO Sunil Dutt, president, PSG Ravi Aggarwal, president, IPG Marshal Correia, director, HP Services Zarir Batliwala, director, HR NVP Tendulkar, CFO | HIGHLIGHTS
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| FACTSHEET l Start-up Year: 1989 l Products & Services: Enterprise servers, software & storage, hardware, imaging & printing, IT services & solutions l Address: 24, Salarpuria Arena, Hosur Main road, Adugodi, Bengaluru 560030 l Tel: 080 2563 3555 l Fax: 080 2563 3222 l Website: www.hp.com/in | ||
Though HP continued to lead in printers, the IPG business failed to really hit off. Adding to the misery was the shortage of laser jet and A-I-O printer supplies with partners, due to inaccurate forecasting. Putting that behind, the IPG though expanded its MPS offerings for the SMB vertical and created a niche partner networkOffice Printing Solution partners. The bigger headache was when it was charged with tax evasion to the tune of Rs 1,450 crore by the Bangalore unit of Directorate of Revenue Intelligence (DRI).
Rank - 5 : Cognizant : Dared to Dream
Cognizants shift from the boys to mens club got official sanction this timethe FY10 growth at more than five times the likes of TCS, Infosys and Wipro (along with HCL Technologies) has finally justified the clubbing of the WITCH companies under one bracket. What separated Cognizant was how it dared to dream bigrecession or not, it made more acquisitions in FY10 than what it had done in the last three years put together. These included Pepperweed Advisors with IT infrastructure consulting capabilities; Paris based IT testing firm, Galileo Performance; London based, PIPC Group with global program management skills as well as UBS India Service Center, the Hyderabad based captive service provider to the UBS Group.
These acquisitions helped Cognizant to expound on its four-by-four-by-four strategy, whereby it expanded its circle of offerings, existing service lines and geographies to four eachthe newer focus areas were retail, telecom and media, the APAC (including India) market and practices like infrastructure management services and engineering & manufacturing solutions. Deals inked with Harris Corporation, Houghton Mifflin Harcourt, Invensys Rail, ELEXON and Rodale during FY10 proved the success of this strategy.
| Rank - 5 : Cognizant | ||
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 | Francisco D Souza, CEO Rajeev Mehta, COO R.Chandrasekaran, president and MD Gordon Coburn, CFO DK Sinha, head, sales | HIGHLIGHTS
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| FACTSHEET l Start-up Year: 1994 l Products & Services: IT and BPO l Address: 5/35, Old Mahibalipuram Road, Thoraipakkam, Chennai 600 097 l Employees: 85,000 l Tel: 044 4209 6000 l Fax: 044 4209 6060 l Website: www.cognizant.com | ||
The EMS practice, the result of its relationship with Invensys, over the year grew to nearly about 1,000 associates and opened up an entirely new market for Cognizant in process manufacturing. On the domestic front, Cognizant serviced Pfizer Global Research and Development (clinical data management and biometric services), SAP Labs (set up the SAP NetWeaver test center in Bengaluru), mjunction services (e-commerce infrastructure for this JV between Tata Steel and SAIL), and interestingly Shri Saibaba Sansthan Trust, Shirdi to provide integrated SI services.
The company also harped on its Two-in-a-Box client engagement model as its key value proposition. The Sanofi Pasteur deal in which Cognizant was selected as its global partner for clinical trials data management was cited as a successful proof point of this model.
Rank - 6 : IBM India : Business as Usual
Though the growth slowed down in a tough year, IBM continued on its chosen path in terms of strategic priorities, while using the slowdown to launch some tactical initiatives. At the same time, in most segments, it enhanced/maintained its market share.
For example, IBM launched a number of productized service offerings as part of its technology services, such as Integrated Managed Services (remote management), IBM Scalable Modular Server Room (data center hosting targeted mostly at SMBs), Express Remote Managed Infrastructure Services for its business partners who want to get into managed IT services and a productized managed security services. Though the services are strategic and long-term, a tough year was probably the best to convince the first few customers and build a sizable reference base.
In outsourcing, IBM is betting on two strategies. One, it has excelled in customer mininggrabbing more and more business from the existing customers. Last year saw many of its clients such as Sun TV, Idea, Amul, Airtel, and Eureka Forbes handing out new repeat contracts. But, what it has really evolved to almost a science is the template approach in verticals and micro-verticals. Started with the much-publicized telecom vertical, it has done the same in media & entertainment, real estate, and now the company is trying that out with rural/coop banks, where it bagged ten contracts. In telecom, though its virtual monopoly at one time, it is being challenged. While IBM still bagged contracts from two of the greenfield telecom operators, it lost out to Wipro and Tech Mahindra in some cases. In the SMB space, this year, it would have to face new competition from TCS, that is entering in a big way.
| Rank - 6 : IBM India | ||
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 | Shanker Annaswamy, MD Rajesh Nambiar, GM, global delivery Manish Gupta, director, IBM Research, India; chief technologist, IBM India/South Asia Robert Parker, chief financial officer, IBM India/South Asia Pavan Vaish, CEO, IBM Daksh Amit Sharma, VP, operations Ponani Gopalakrishnan, VP, ISL Chandrasekhar Sripada, VP & head HR, India/South Asia Jeby Cherian, India/SA strategy leader | HIGHLIGHTS
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| FACTSHEET l Start-up Year: 1992 l Products & Services: IT services, BPO, servers, storage, middleware, systems software l Address: No 12, Subramanya Arcade Road, Bannerghatta Road Bengaluru 560 029 l Employees: 75,000 l Tel: 080 4068 3000, 2678 8015 l Fax: 080 4068 4225 l Website: www.ibm.com/incom | ||
IBM remained number one in non-x86 server space while still trailing at number two in x86 server markets. In external disk storage, it actually enhanced its lead, as it gained most at the cost of Sun. IBM had got into the headlines because of layoffs in global delivery. Though last year did not see much of anything like that, IBM stopped giving its headcount numbers. Speculation is rife that IBM may acquire an Indian services firm. It continued its diversity and CSR programs and won a number of recognitions including Golden Peacock for CSR and Hellen Keller award.
Rank - 7 : HCL INFOSYSTEMS : ME and My Services
FY10 was all about ME, or Mobile Excitement, HCL Infys multi-dimensional campaign for introducing trendy notebooks into the Indian market. ME was a focused marketing strategy that included a new logo and TV commercials focused around mobility. Though ME is yet to reap dividends for HCLI (it was not even among the top three in notebooks market share), it led the market q-o-q on the desktop frontFY10 saw the return of the Beanstalk desktop series. OND was the worst quarter with normalcy resuming only during JFM; overall the systems business during FY10 was worth Rs 3,278 crore. Lower realizations from the Nokia business also impacted sales revenues, especially in the JFM quarter mainly because Nokia sales were down as a result of competition at the low end and the dual SIM space where it did not have any product.
The real story for HCLI however centered around services; its three-year journey to evolve as a solution provider from a hardware vendor was nearing culmination in FY10.The journey, however, has been anything but easy. The domestic services at Rs 654 crore was flat (Rs 643 crore in FY09); besides the general slowdown it was also due to delayed payment realization from the distribution side. Government spending though was high with HCLI building customized solutions, taking a productized approach. Deals involving e-municipalities, e-districts and other financial inclusion aspects followed this approach. There was growing traction for services in e-governance, power, telecom, BFSI and infrastructure (including transportation and railways); it managed the command & control center for Delhi and Mumbai airports, developed the e-procurement solution for Railways and deployed ticket dispensing machines for unreserved ticketing at 390 locations.
| Rank - 7 : HCL INFOSYSTEMS | ||
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 | Ajai Chowdhry, chairman & CEO JV Ramamurthy, president & COO Sandeep Kanwar, CFO M Chandrasekaran, head, office automation products Rothin Bhattacharya, head, homeland security George Paul, head, marketing | HIGHLIGHTS
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| FACTSHEET l Start-up Year: 1976 l Products & Services: Computers, storage systems, managed systems, infrastructure, office automation, software and network integration l Address: E-4.5,6, Sector 11, Noida 201301 l Employees: 128,150 l Tel: 012 0252 6518/19 l Fax: 012 0255 0923 l Website: www.hclinfosystems.in | ||
The physical security business (now headed by industry veteran Rothin Bhattacharya) gathered momentum, bagging an order from Bhopal for surveillance solution and security surveillance for Kumbh Mela at Haridwar. The highlight was the Rs 100 crore order from the Delhi government for establishing exclusive Government Radio Network during CWG 2010.
Rank - 8 : HCL Technologies : Beating All Odds
With the Axon integration complete, it was anybodys guess that the exhilarating growth wont last. But HCL Technologies impressed everyone with a 25% growth (excluding BPO) in a year when most services firms saw flat or negative growth. For once, HCLT even beat the growth machine, Cognizant.
Given the tough market scenario, the blue ocean strategy took a backseat and HCLT focused instead on holding fort and growing organically. As a result, HCLT went after volume. The move yielded results as the company signed deals worth more than a billion dollars in the year (Nokia, Vodafone, Malaysian Airlines, Electrolux, GSK, Merck & Co and Singapore Exchange). The highlight of the year was the $200 mn deal with Equitable Life for support activities to run its closed book of business.
Although BFSI and manufacturing remained key verticals, telecom was the real growth area. Volumes came from BFSI and large transformational deals from telecom. Media & publishing and healthcare were the other verticals that HCLT went after in FY10. Horizontally, RIM and Axons SAP services formed the backbone of most of the big deals. A major chunk of work, however, happened onsite, because of specific client requirements.
| Rank - 8 : HCL Technologies | ||
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 | Vineet Nayar, CEO Anant Gupta, President, HCL ISD Anil Chanana, Head of Finance Rahul Singh, President, BPO Business Services | HIGHLIGHTS
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| FACTSHEET l Start-up Year: 1991 l Products & Services: Software, infrastructure, and BPO l Address: A-10-11, Sector-III, Noida 201301 l Employees: 55,000 l Tel: 0120 252 00 917/937/997 l Fax: 0120 2526 907 l Website: www.hcltech.com | ||
Engineering services, traditionally a strong area, suffered under the slowdown. HCLT managed some growth in Q4 (flat in Q3 and negative in the previous eight quarters). Aerospace didnt generate any big deals though some relief came from telecom and hi-tech segments. HCLT also decided to play up its geographical mix and enhanced focus on IT infrastructure services in Brazil, also setting up a delivery location. The Middle East was also a focus area, but being a late entrant, the company is struggling to make inroads there. Surprisingly, Europe witnessed the highest growth rate on the back of SAP consulting and infrastructure services. APAC and Japan fared well, but on a relatively smaller base.
HCLT learned the currency lessons the hard way in 2008, when it hedged a billion dollars at the beginning of the year. Though there was no hedging done in FY10, the company is still writing off previous losses.
Rank - 9 : Ingram Micro : Battered and Bruised
Lightning never strikes twice. But for Ingram, it kept on striking in FY10 as some of its worst anticipations came true. But that also meant that they could anticipate some of the reversals and accordingly focus on improving internal efficiencies. The direct and maximum impact on revenues was owing to the dip in the telecom business, the number two business in FY09. Sony Ericsson deciding to move to the high-end products segment meant it was no more playing on the high volumes market, and this consequently had a direct bearing on its contribution to Ingram revenues. IT business too was flatconsumer product categories in the systems segment were badly hit by the slowdown; commercial business slowed down from Q2 onwards and the PC business bore the brunt of the corporates, and the much-touted government sector going into relative inactivity. Ingram also gave up some share of the Intel and Seagate business, as they were not turning out to be profitable enough. And last but not the least, there was considerable pressure on the working capital as most vendors who had extended credit periods withdrew it by Q3. While most of these crises were anticipated, HPs decision to move from a national to a regional distribution model for its consumer PCs came as a bolt. In order to establish a more direct control on its retail setup and reach more consumers directly, HP (Ingrams largest vendor) reduced the billing for Ingram. And even as Ingram refrained from doing Microsoft business over the software double taxation issue, Microsoft promptly sidelined it and appointed Rashi, Compuage and Neoteric to increase its Microsoft Operating License Products business.
It was not all doom and gloom though. Its B2B website for resellers was a resounding success in improving transparency and reducing costs of doing both stock sales and run-rate business. Ingram took a lead on this in the Indian market and in FY10 30% of its business happened through this website.
| Rank - 9 : Ingram Micro | ||
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 | K Jaishankar, MD Prabhakar Iyer, chief financial officer Bimal Das, senior director, computing systems group Sanjay Achawal, senior director, enterprise business group Bindra Navneet Singh, director, sales Srinivasan Ravindran, director, operations Atul Gaur, director, consumer electronics & telecom group Aloysius Fernandes, director, peripherals & components group | HIGHLIGHTS
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| FACTSHEET l Start-up Year: 1996 l Products & Services: Distribution of IT products & consumer electronics l Address: Gate 1A, Godrej Industries Complex, Pirojshanagar, Eastern Express Highway, Vikhroli (E), Mumbai 400 079 l Employees: 1,200 l Tel: 022 6796 0110 l Fax: 022 6796 0103 l Website: www.ingrammicro.com | ||
There was an increasing focus on high value low volume businesses like Adobe, Autodesk, IBM Software, Oracle, Fortinet, Juniper, Symantec, McAfee and Trend Microthat offered high margins. But it were the newer areas like AIDC, PoS and surveillance that showed great promise with Ingram signing up a number of niche vendors.
Rank - 10 : Redington India : Staying Afloat
It was a tough H1 for Redington that saw severe pressure on margins as vendors reduced rebate offerings. Moreover, the accounts receivables condition remained tough with longer collection cycles; add long closure periods in the commercial business and the overall sluggish market conditions. And then the likes of HP and Microsoft reduced billingswhile HP focused more on regional distribution for consumer PCs, Microsoft opted for other national distributors when Redington along with Ingram took it on over the software double taxation issue.
In these trying times, Redington faced the market conditions by putting in place a multi-pronged strategy. It assembled a strong project team and focused engagements with all partners active in the government business space. This paid off with good deals on the networking side coming from the government. Moreover, adding key vendors to complete product bouquet offering like Oracle beefed up its enterprise portfolio. New principals like Avaya and Brocade who signed Redington as national distributors started contributing in FY10 itselfenterprise and networking accounted for 11% and 8% of Redington revenues, respectively.Yet another critical enabler that helped Redington to sustain its business was its funding program under Easy Access Financial Services, its wholly owned NBFC, that brought in the much needed working capital to channel partners.
| Rank - 10 : Redington India | |||
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 EH Kasturi Rangan, president, non-IT division |  PS Neogi, president, IT division | PS Neogi, president, IT division and E H Kasturi Rangan, president, non-IT Division SV Krishnan, CFO Ramesh Natarajan, head of sales Clynton Almeida, CIO | HIGHLIGHTS
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| FACTSHEET l Start-up Year: 1993 l Products & Services: Distributor of PCs, servers, peripherals, consumables, networking equipment and components l Address: SPL Guindy House, 95, Mount Road, Chennai 600 032 l Employees: 1,800 l Tel: 044 4224 3535 l Fax: 044 2235 2790 l Website: www.redingtonindia.com | |||
Process efficiencies significantly went up after its Automated Distribution Center (ADC) in Chennai went live and became fully operational; coupled with its state-of-the-art warehouse management system this significantly enhanced Redingtons distribution process. The company scouted for prospective customers from FMCG and automobile industries, amongst others, for providing 3PL activities out of this Chennai ADC. There are now plans to have these ADCs now in four metros for which Redington invested about Rs 150 crore. It was Redingtons diversification into the non-IT business few years back that paid-off handsomely in FY10, with the non-IT business accounting for 12% of its revenuesa 100% growth since FY09. Telecom business was the key with the exclusive relationship with Blackberry retail (especially in the unlocked space) witnessing good momentum.
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