Leading technology vendors continue to offer added offerings in the digital space to improve their top-line revenue and maintain a healthy profit margin
Majority of the technology vendors continue to struggle with the impact of COVID-19 pandemic. Despite this, leading Indian IT vendors continue to shine through the crisis, driven by their cloud and digital transformation offerings, according to GlobalData.
Leading technology vendors continue to offer added offerings in the digital space to improve their top-line revenue and maintain a healthy profit margin. Companies are focusing on strategic product offerings to operate in the current as well as the potential agile business environment with a view to meet customer expectations via the digital channel.
Sunil Kumar Verma, Lead ICT Analyst at GlobalData, says: “Majority of the Indian IT vendors had already concentrated their efforts towards the digital world through their cloud, digitization and automation offerings. Though the adoption of digital offerings and enterprises’ efforts of embracing the digital world existed previously as well, the COVID-19 outbreak has further accelerated it.”
Workload migration to cloud, automation of the existing processes, infrastructure modernization, cybersecurity, AI-based applications deployments, adoption of digital platforms are some of the key areas, which are enabling Indian technology vendors to sustain in the current scenario.
Verma continues: “Though the revenue for the June 2020 quarter declined for most of the Indian IT vendors, yet there was some silver lining for them for September 2020, thanks to their digital focus. Demand for digital is expected to grow as companies focus on having intelligent, automated, migration acceleration platforms and services.”
For instance, the digital revenue contribution to the overall revenue of Infosys increased from 41.9% in March 2020 to 47.3% in September 2020. For Wipro, key deal wins for digital transformations during the quarter ended in September resulted in its digital operations and platforms service line account for 15.5% of the revenue as compared to 14.8% in the previous quarter.
Tech Mahindra reported net new deals worth USD 421m for the quarter ended September 2020, besides partnering with Amazon Web Services (AWS) for blockchain technology and VitalTech for offering digital technologies to healthcare providers. TCS too has won key deals for digital transformation from women’s fashion-apparel retail chain ‘maurices’ and customer experience transformation from Travelport during the quarter. HCL’s Mode 1-2-3 Strategy has enabled it to win digital transformation deals globally. Additionally, it has launched key products like Automation Power Suite, NetBot, updated versions of its DRYiCE offerings to further strengthen its digital portfolio. For L&T Infotech, digital revenue accounted for approximately 42.9% of the revenue for the quarter ended September 20 as against 42.0% in June 2020.
Verma concludes: “Indian IT vendors are more likely to be in demand in the coming years, as the clients focus on cost rationalization and look for partners that can provide them with a consultative approach along with management of their entire IT infrastructure, thereby offering a value-based service delivery model.”