TCS says global hiring is on track

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Tata Consultancy Services on Monday said its aggressive overseas hiring spree was on track, with 9.6 per cent of its workforce now comprised of overseas nationals, the highest among India’s computer services companies.

The company, India’s largest IT outsourcing company, said at a press conference to announce its full-year results that the figure had risen from 8.8 per cent at the end of the December and from a fraction of a per cent only four or five years ago.

“Our efforts to build a global pool of professionals are bearing fruit with almost 10 per cent of ‘TCSers’ now overseas nationals,” said S. Padmanabhan, head of global human resources at TCS.

The move comes as Indian companies are seeking to expand geographically to get closer to clients, win over new markets and to spread their risk.

India remains the focus for the global IT outsourcing industry.

But TCS and its Indian peers are increasingly tapping markets, such as Mexico, Brazil and eastern Europe, which provide access to low-cost talent and foreign language speakers in closer geographic proximity to their major markets in the US and Europe.

TCS is also targeting China’s domestic market, and in a separate move it announced Monday it was setting up a development centre in Morocco.

The comments came as the company said sales in the financial year ending March grew 41 per cent to Rs186.85bn ($4.46bn), up 41 per cent year-on-year.

The company’s sales have effectively doubled in two years as more western multinationals move IT functions to offshore locations, such as India.

TCS said its US business generated $2bn of total sales and Europe $1bn.

Net profit for the year was Rs42.13bn, up 42 per cent year-on-year.

The results indicate another robust year for India’s IT companies, with Infosys Technologies, India’s number two computer services company, last week reporting a 57 per cent jump in 2006-07 net profit.

TCS predicted it would increase salaries by 12-15 per cent this year, in line with Infosys, as the country’s IT industry battles for scarce talent.

TCS hired 32,462 people to bring its workforce to 89,419 as of March 31 on an attrition rate of 11.3 per cent.

The company’s margin based on earnings before interest, taxation, depreciation and amortisation, a key measure of profitability in the industry, rose to 28.31 per cent from 26.4 per cent a year earlier.

This was despite the appreciation of the rupee against the dollar.

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