1 Globalisation of Indian IT Sector 23 February 2011.

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Globalisation of Indian IT Sector23 February 2011

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Global technology and outsourcing -- market size & growth

*2010Source: IDC, Everest Research, NASSCOMM*2010Source: IDC, Everest Research, NASSCOMM

Global technology spending grew by 4%,outpaced by global sourcing growth of 10%Global technology spending grew by 4%,outpaced by global sourcing growth of 10%

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Indian IT – BPO industry export revenues

Indian IT-BPO Export Revenues *(USD Billion)Indian IT-BPO Export Revenues *(USD Billion)

*Excluding Hardware

Source: NASSCOMM

*Excluding Hardware

Source: NASSCOMM

• India’s share in global sourcing –

55% in 2010, up from 51% in 2009

• Industry accounts for 26% of India’s

exports

• IT services exhibiting fastest growth

at 23%, BPO growing by 14%

• Transformation, new business

models, driving organization wide

efficiencies

• Emergence of verticalised solutions

• India’s share in global sourcing –

55% in 2010, up from 51% in 2009

• Industry accounts for 26% of India’s

exports

• IT services exhibiting fastest growth

at 23%, BPO growing by 14%

• Transformation, new business

models, driving organization wide

efficiencies

• Emergence of verticalised solutions

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Domestic Indian IT – BPO industry

Indian IT-BPO Domestic Revenues *(INR Billion)Indian IT-BPO Domestic Revenues *(INR Billion)

*Excluding HardwareSource: NASSCOMM*Excluding HardwareSource: NASSCOMM

• Domestic industry over $16 billion

annually

• IT – BPO seen as a critical

enabler for inclusive growth and

transformation

• Government drive to drive

performance and efficiency

accelerating growth (like private

sector to handle issue of

passports, railway reservation

automation, free internet kiosks

for villages)

• Domestic industry over $16 billion

annually

• IT – BPO seen as a critical

enabler for inclusive growth and

transformation

• Government drive to drive

performance and efficiency

accelerating growth (like private

sector to handle issue of

passports, railway reservation

automation, free internet kiosks

for villages)

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Employment - Indian IT – BPO industry

Direct Employment (‘000)Direct Employment (‘000)

Source: NASSCOMMSource: NASSCOMM

• Industry directly employs 2.5 million

professionals

• Industry building future ready

organizations through• Sustained investment in training• Opportunities for career growth• Managing people challenges

effectively• Ensuring cost competitiveness

• ~2 per cent of revenues spent on

training - industry supplementing the

education system

• Industry directly employs 2.5 million

professionals

• Industry building future ready

organizations through• Sustained investment in training• Opportunities for career growth• Managing people challenges

effectively• Ensuring cost competitiveness

• ~2 per cent of revenues spent on

training - industry supplementing the

education system

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Indian IT – BPO industry exports – sector wise trend

Source: NASSCOMMSource: NASSCOMM

Broad-based growth – Emerging verticals growing faster than the traditional onesBroad-based growth – Emerging verticals growing faster than the traditional ones

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India multipliers – for being future ready

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New BusinessModelsNew BusinessModels

• Shift towards managed services model,

• From FTE based to outcome based; pay

per use model, CAPEX to OPEX

• Shift towards managed services model,

• From FTE based to outcome based; pay

per use model, CAPEX to OPEX

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Innovation andTransformationInnovation andTransformation

• IP Led innovation

• Innovation through process re-

engineering

• IP Led innovation

• Innovation through process re-

engineering

Patents granted to top 5 Indian IT companiesPatents granted to top 5 Indian IT companies

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Global DeliveryGlobal Delivery • Globally dispersed footprints• Customer intimacy

• Globally dispersed footprints• Customer intimacy

Cross-border M&A DealsCross-border M&A Deals

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Service deliveryaround new techService deliveryaround new tech

• Everything as a service model,

platforms• Develop applications around cloud and

platform based solutions

• Everything as a service model,

platforms• Develop applications around cloud and

platform based solutions

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Outlook and challenges

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Future Growth& OutlookFuture Growth& Outlook

• FY2012 software and services growth forecast 16-18 per

cent

• Broad based growth – across service lines and verticals

• New geographies(APAC, Middle East, Japan) incl. domestic

market

• M&A - niche domains and global presence to escalate

• Onshore delivery – key priority

• FY2012 software and services growth forecast 16-18 per

cent

• Broad based growth – across service lines and verticals

• New geographies(APAC, Middle East, Japan) incl. domestic

market

• M&A - niche domains and global presence to escalate

• Onshore delivery – key priority

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ChallengesChallenges • Talent – quality and employability; Wage Inflation and

attrition

• Currency fluctuations, Inflation

• Issues of Protectionism and Visas

• Talent – quality and employability; Wage Inflation and

attrition

• Currency fluctuations, Inflation

• Issues of Protectionism and Visas

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A quick snapshot of HCL

HCL Enterprise

HCL Technologies

The software services arm

HCL InfoSystems

The systems integration arm

$5.5$5.5292977,00077,000

BILLION

COUNTRIES

PEOPLE

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CANADA

SunnyvaleIrvine

Mexico City

DallasUtah

Los AngelesHouston

Chicago

Columbia

StamfordChicago

CARY, NORTH CAROLINA

Toronto

FairfaxNew Jersey

SAO LEOPOLDO, BRAZILSao Paolo

SOUTH AFRICA

KRAKOW,POLAND

FINLANDSWEDEN

ITALYSWITZERLANDFRANCE

NETHERLANDS

GERMANY

U.K.

LondonBelfast

INDIA

JAPAN

SHANGHAI, CHINAHONGKONG

Perth

MelbourneSydney

Brisbane

Wellington Auckland

SINGAPOREMALAYSIA

Dubai

Israel

INDIAPUERTO RICO

CZECH REPUBLICBelgium

SAUDI ARABIA

Beijing, China

Global Presence

• 10 Global Delivery Centers (outside India)

• 6 Delivery centers in UK (out of which 2 are in Northern Ireland)

• One of the largest employers in NI today – employing over 2,000 people

• Over 4,500 employees working for HCL in Europe (including onsite

presence)

• 10 Global Delivery Centers (outside India)

• 6 Delivery centers in UK (out of which 2 are in Northern Ireland)

• One of the largest employers in NI today – employing over 2,000 people

• Over 4,500 employees working for HCL in Europe (including onsite

presence)

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Globally Admired

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HCL is taught at Harvard as a premier case study on strategy

and organizational leadership

One of Britain’s Top Employers for the

4th Consecutive Year

Acknowledges HCL Technologies as the world’s most

modern management

Darden School of Business has done a case study on the impact created by HCL through its “Employees First Customers Second” practice

HCL Technologies is Disruptive and Bears Watching…though it has not received the hype of a salesforce.com or Google, we believe HCL may very well be one of the contenders to lead the IT services world of the very near future.”

“IBM and the other multinationals are becoming increasingly nervous about HCL Technologies…”

Best Employer in India –Hewitt Study 2009

One of the 44 Most Democratic Workplaces in the World

Employees First, Customers Secondis now a book Published by Harvard Press

Foreword by Late Prof C.K. PrahaladAdmired by many global thought leaders

Tom Peters, Tony Hsieh, Gary Hamel, Judy McGrathRam Charan, Victor K. Fung

Included in Forbes’ prestigious 'Asia's Fab 50 List' for 2010 

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Scale and Integrated services capability

“HCL’s recent IT outsourcing and hosted application management (AM) contract wins heralds a milestone in both the offshore IT services competitive landscape and the U.S. IT outsourcing and application outsourcing markets”

"To all the remaining doubters out there: HCL has just whipped away your comfort blanket! This deal is proof that Indian-based outsourcers have what it takes to beat the established players,”

IBM and the other multinationals are becoming increasingly nervous about the fifth-biggest Indian outsourcer, HCL Technologies

International long term savings groups

5 Year~$500 mn

5 Year~$100 mn/Yr

5 Year~$200 mn

World’s Leading Pharma Company

UK Based Leading Telecom Major

BPO, ITO

BPO, ITO, IMS,

Consulting

BPO, ITO, IMS

Leading global investment bank

9+ Year~$200 mn/year

BPO, ITO, IMS

Client Client Profile

Integrated services – Major Client Deals

Service Components

Deal Value

Deal

Period

About our Success…Rated as leader in Global Delivery Infrastructure Management Wave

Gartner puts HCL as a Challenger in Application Services

About our Leadership….

Ranked in the “Leaders” Category of the Global Outsourcing 100 - IAOP

Ranked 1st among the Top 50 Best Managed Global Outsourcing Vendors – Black Book of Outsourcing

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HCL Strengths (As defined by our Customers*)

Entrepreneurial CultureEntrepreneurial Culture

Broad based Services Broad based Services

Highly Engaged PeopleHighly Engaged People

Customer AlignedCustomer Aligned

70 CIOs/ CTOs form the HCL Customer Advisory Council 70 CIOs/ CTOs form the HCL Customer Advisory Council

* Source: HCL Brand Workshop conducted with HCL CAC members Oct/ Nov 2010

“ It’s good to do business with HCL ”

• Engineering DNA• Skin in the game

• Most balanced portfolio

• Globally competitive

• Leadership commitment

• Employees First

• Aligned with customer’s strategy

• Transparency

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Thank You

For further details and questions, please contact:

Udayan Guha Vice-President, EuropeHCL Technologies - Business Services Division

Mail: [email protected]: +44-75450-86986Tel: +44-20-7105-8600

HCL, 7th Floor, 68 King William Street, London, EC4N 7DZ