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© Tata Consultancy Services ltd. 11 October 2005 1 Results for Quarter II FY 2005-06 TCS Corporate Office
38

Results for Quarter II FY 2005-06...Q2 FY 2006 Q1 FY 2006 Q2 FY 2005 Q2 FY 2006 Q1 FY 2006 Q2 FY 2005 INCOME a) IT & Consultancy Services 2,367.64 2,188.73 1,973.51 94.11 96.73 95.95

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Page 1: Results for Quarter II FY 2005-06...Q2 FY 2006 Q1 FY 2006 Q2 FY 2005 Q2 FY 2006 Q1 FY 2006 Q2 FY 2005 INCOME a) IT & Consultancy Services 2,367.64 2,188.73 1,973.51 94.11 96.73 95.95

© Tata Consultancy Services ltd. 11 October 2005 1

Results for Quarter II FY 2005-06

TCS Corporate Office

Page 2: Results for Quarter II FY 2005-06...Q2 FY 2006 Q1 FY 2006 Q2 FY 2005 Q2 FY 2006 Q1 FY 2006 Q2 FY 2005 INCOME a) IT & Consultancy Services 2,367.64 2,188.73 1,973.51 94.11 96.73 95.95

2

Disclaimer

Certain statements in this release concerning our future growth prospects are forward- looking statements, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, intense competition in IT services including those factors which may affect our cost advantage, wage increases, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed- price, fixed-time frame contracts, client concentration, restrictions on immigration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which TCS has made strategic investments, withdrawal of governmental fiscal incentives, political instability, legal restrictions on raising capital or acquiring companies outside India, and unauthorized use of our intellectual property and general economic conditions affecting our industry. TCS may, from time to time, make additional written and oral forward looking statements, including our reports to shareholders. The Company does not undertake to update any forward-looking statement that may be made from time to time by or on behalf of the company.

Page 3: Results for Quarter II FY 2005-06...Q2 FY 2006 Q1 FY 2006 Q2 FY 2005 Q2 FY 2006 Q1 FY 2006 Q2 FY 2005 INCOME a) IT & Consultancy Services 2,367.64 2,188.73 1,973.51 94.11 96.73 95.95

3

Highlights for Q2 2005-06INDIAN GAAP

Total Income

Y-on-YQ-on-Q

PBIDT

PAT

21.83 %10.16 %

23.56 %7.95 %

20.69 %

Rs. Crores

2,983

893

694 10.00 %

EPS – Rs 14.45 for Q2, up from Rs. 13.13 for Q1

Added 74 clients this quarterNet Addition of 4,224 employees this quarter

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4

Highlights for Q2 2005-06US GAAP

Revenues

Y-on-YQ-on-Q

Operating Income

Net Income

7,921 16.95 %6.77 %

6,734 16.72 %8.84 %

29,513 21.43 %8.93 %

Rs. Millions

EPS – Rs 14.03 in Q2, up from Rs. 12.89 in Q1

Added 74 clients this quarterNet Addition of 4,224 employees this quarter

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5

Highlights for Q2 2005-06: Strong Financial Performance and Growth Momentum

TCS continues the growth momentum based on strong fundamentals. We signed several large contracts during the quarter including two deals of value US $250 million each.

All TCS service segments – BPO, Remote Infrastructure Management, Asset based Solutions, EIS and Consulting have scaled up and we are witnessing very strong customer acceptance.

We experienced very strong customer acquisition across geographies, verticals and service segments. In all, we added 74 new clients during the quarter.

TCS became the first Indian IT services company in India to have more than 50,000+ associates.

We are witnessing a very strong interest – both in terms of number of deals and sizes of deals to our global GDCs.

TCS CEO led the NASSCOM delegation to China during the quarter.

Page 6: Results for Quarter II FY 2005-06...Q2 FY 2006 Q1 FY 2006 Q2 FY 2005 Q2 FY 2006 Q1 FY 2006 Q2 FY 2005 INCOME a) IT & Consultancy Services 2,367.64 2,188.73 1,973.51 94.11 96.73 95.95

© Tata Consultancy Services ltd. 11 October 2005 6

TCS GDC - Budapest

Financial Performance

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Growth Summary – Consolidated Indian GAAPConsolidated Indian GAAP (Rs. Crores) Q2 FY06 Q1 FY06 Q2 FY05

Income from IT & Consultancy Services 2,774 2,536 2,319

% Growth Y-o-Y 19.65%% Growth Q-o-Q 9.41%

Total Income 2,983 2,707 2,448

% Growth Y-o-Y 21.83%% Growth Q-o-Q 10.16%

PBIDT 893 827 723

% Growth Y-o-Y 23.56%% Growth Q-o-Q 7.95%

Profit before one-off items 694 631 575

% Growth Y-o-Y 20.70%% Growth Q-o-Q 10.00%

Profit After Tax 694 631 298

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Indian GAAP Income Statement – Consolidated – Q2 06Consolidated Indian GAAP

Q2 FY 2006 Q1 FY 2006 Q2 FY 2005 Q2 FY 2006 Q1 FY 2006 Q2 FY 2005

INCOMEa) IT & Consultancy Services 2,774.20 2,535.58 2,318.55 93.01 93.65 94.70 b) Sale of equiptment and licences 185.72 146.72 122.48 6.23 5.42 5.00 c) Other Income 22.68 25.17 7.16 0.76 0.93 0.29 Total Income 2,982.60 2,707.47 2,448.19 100.00 100.00 100.00

EXPENDITURE a ) Salaries & Wages 1,164.49 674.65 532.72 39.04 24.92 21.76 b ) Overseas business expenditure 226.26 651.53 611.08 7.59 24.06 24.96 c) Other operating expenses 699.12 554.32 581.88 23.44 20.47 23.77 Total Expenditure 2,089.87 1,880.50 1,725.68 70.07 69.46 70.49

PROFIT BEFORE INTEREST, DEPRECIATION, TAXES 892.73 826.97 722.51 29.93 30.54 29.51

Interest 0.99 1.66 3.80 0.03 0.06 0.16 Depreciation 62.85 53.04 36.79 2.11 1.96 1.50 PROFIT BEFORE TAXES 828.89 772.27 681.92 27.79 28.52 27.85 PROVISION FOR TAXES

a) Current tax expense 124.02 154.40 92.60 4.16 5.70 3.78 b) Deferred tax expense 5.40 (31.99) 9.45 0.18 (1.18) 0.39 c) Fringe benefit tax 1.02 9.93 - 0.03 0.37 -

PROFIT AFTER TAXES FROM OPERATIONS 698.45 639.93 579.87 23.42 23.64 23.69 Minority Interest 5.02 9.51 5.76 0.17 0.35 0.24 Share of profit in respect of investments in Associates 0.28 0.20 0.65 0.01 0.01 0.03 PROFIT BEFORE ONE-OFF ITEMS 693.71 630.62 574.76 23.26 23.29 23.48 One-off items - - 251.67 - - 10.28

NET PROFIT AS REPORTED 693.71 630.62 323.09 23.26 23.29 13.20 Adjustments for EVA - - 25.06 1.02 Proforma Adjusted Net Profit 693.71 630.62 298.03 23.26 23.29 12.17

Rs. Crores % of Revenue

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Indian GAAP Income Statement – Consolidated – H1 06Consolidated Indian GAAP

H1 FY 2006 H1 FY 2005 H1 FY 2006 H1 FY 2005

INCOMEa) IT & Consultancy Services 5,309.78 4,355.17 93.32 93.81 b) Sale of equiptment and licences 332.44 261.95 5.84 5.64 c) Other Income 47.85 25.24 0.84 0.54 Total Income 5,690.07 4,642.36 100.00 100.00

EXPENDITURE a ) Salaries & Wages 1,839.14 1,050.44 32.32 22.63 b ) Overseas business expenditure 877.79 1,153.05 15.43 24.84 c ) Other operating expenses 1,253.44 1,100.75 22.03 23.71 Total Expenditure 3,970.37 3,304.24 69.78 71.18

PROFIT BEFORE INTEREST, DEPRECIATION, TAXES 1,719.70 1,338.12 30.22 28.82

Interest 2.65 8.14 0.05 0.18 Depreciation 115.89 73.32 2.04 1.58 PROFIT BEFORE TAXES 1,601.16 1,256.66 28.14 27.07 PROVISION FOR TAXES

a) Current tax expense 278.42 182.52 4.89 3.93 b) Deferred tax expense (26.59) 16.62 (0.47) 0.36 c) Fringe benefit tax 10.95 - 0.19 -

PROFIT AFTER TAXES FROM OPERATIONS 1,338.38 1,057.52 23.52 22.78 Minority Interest 14.53 14.83 0.26 0.32 Share of profit in respect of investments in Associates 0.48 0.78 0.01 0.02 PROFIT BEFORE ONE-OFF ITEMS 1,324.33 1,043.47 23.27 22.48 One-off items - 251.67 - 5.42

NET PROFIT AS REPORTED 1,324.33 791.80 23.27 17.06 Adjustments for EVA - 49.07 - 1.06 Proforma Adjusted Net Profit 1,324.33 742.73 23.27 16.00

% of RevenueRs. Crores

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Indian GAAP Balance Sheet - ConsolidatedConsolidated Indian GAAP

30-Sep-05 31-Mar-05 30-Sep-05 31-Mar-05Source of FundsShareholders' Funds 4,625.51 3,477.54 94.85 90.65 Minority Interest 101.42 89.74 2.08 2.34 Loan Funds 110.47 203.01 2.27 5.29 Deferred Tax Liability 39.30 66.00 0.81 1.72 Total Liabilities 4,876.70 3,836.29 100.00 100.00 Application of FundsFixed Assets (net) 1,295.04 1,138.77 26.56 29.68 Goodwill 497.12 478.89 10.19 12.48 Investments 511.74 422.07 10.49 11.00

Current Assets, Loans and Advances 4,109.86 3,250.10 84.28 84.72 Current Liabilities and Provisions (1,537.06) (1,453.54) (31.52) (37.89)

Net Current Assets 2,572.80 1,796.56 52.76 46.83 Total Assets 4,876.70 3,836.29 100.00 100.00

%Rs Crores

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Indian GAAP Income Statement - UnconsolidatedUnconsolidated Indian GAAP

Q2 FY 2006 Q1 FY 2006 Q2 FY 2005 Q2 FY 2006 Q1 FY 2006 Q2 FY 2005

INCOMEa) IT & Consultancy Services 2,367.64 2,188.73 1,973.51 94.11 96.73 95.95 b) Sale of equiptment and licences 136.85 61.33 72.64 5.44 2.71 3.53 c) Other Income 11.24 12.70 10.75 0.45 0.56 0.52 Total Income 2,515.73 2,262.76 2,056.90 100.00 100.00 100.00

EXPENDITURE a ) Salaries & Wages 989.37 504.28 419.67 39.33 22.29 20.40 b ) Overseas business expenditure 199.54 624.88 580.31 7.93 27.62 28.21 c) Other operating expenses 559.55 414.11 407.63 22.24 18.30 19.82

Total Expenditure 1,748.46 1,543.27 1,407.61 69.50 68.20 68.43 PROFIT BEFORE INTEREST, DEPRECIATION, TAXES 767.27 719.49 649.29 30.50 31.80 31.57

Interest 0.08 0.59 2.92 0.00 0.03 0.14 Depreciation 56.33 46.61 30.73 2.24 2.06 1.49

PROFIT BEFORE TAXES 710.86 672.29 615.64 28.26 29.71 29.93 PROVISION FOR TAXES

a) Current tax expense 84.17 116.27 67.07 3.35 5.14 3.26 b) Deferred tax expense 6.37 (31.84) 9.91 0.25 (1.41) 0.48 c) Fringe benefit tax - 9.00 - - 0.40 -

PROFIT BEFORE ONE-OFF ITEMS 620.32 578.86 538.66 24.66 25.58 26.19 One-off items - - 196.47 - - 9.55 NET PROFIT AS REPORTED 620.32 578.86 342.19 24.66 25.58 16.64 Less Adjustments for EVA 25.06 - - 1.22 Proforma Adjusted Net Profit 620.32 578.86 317.13 24.66 25.58 17.85

Rs. Crores % of Revenue

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Growth Summary – US GAAPConsolidated US GAAP (Rs Million) Q2 FY06 Q1 FY06 Q2 FY05

Revenue 29,513 27,094 24,307

% Growth Y-o-Y 21.43%% Growth Q-o-Q 8.93%

Gross Margin 13,671 13,090 10,907

% Growth Y-o-Y 25.34%% Growth Q-o-Q 4.44%

Operating Income 7,921 7,419 6,773

% Growth Y-o-Y 16.95%% Growth Q-o-Q 6.77%

Net Income Before One-Off items 6,734 6,187 5,769

% Growth Y-o-Y 16.72%% Growth Q-o-Q 8.84%

Net Income 6,734 6,187 3,433

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US GAAP Income Statement - QuarterlyConsolidated US GAAP USD Million

Q2 FY06 Q2 FY06 Q1 FY06 Q2 FY05 Q2 FY06 Q1 FY06 Q2 FY05

Revenue 670.53 29,513.49 27,094.31 24,307.27 100.00 100.00 100.00 Cost of revenue 359.93 15,842.34 14,003.88 13,400.14 53.68 51.69 55.13

Gross margin 310.60 13,671.15 13,090.43 10,907.13 46.32 48.31 44.87 SG & A expenses 130.64 5,750.16 5,671.88 4,134.40 19.48 20.93 17.01

Operating income 179.96 7,920.99 7,418.55 6,772.73 26.84 27.38 27.86 Other income (expense), net 3.87 170.19 98.46 (8.00) 0.58 0.36 (0.03)

Income before income taxes 183.83 8,091.18 7,517.01 6,764.73 27.42 27.74 27.83 Income taxes 29.92 1,316.96 1,247.03 945.88 4.46 4.60 3.89 Equity in net earnings of affiliates 0.06 2.75 2.02 5.93 0.01 0.01 0.02 Income after income taxes 153.97 6,776.98 6,272.00 5,824.78 22.96 23.15 23.96 Minority Interest 0.98 43.24 85.30 55.77 0.15 0.31 0.23 Net Income before One-off items 152.99 6,733.73 6,186.70 5,769.02 22.82 22.83 23.73 Less: One-off Items - - - 2,085.52 - - 8.58 Net Income after One-off items as reported 152.99 6,733.73 6,186.70 3,683.50 22.82 22.83 15.15 Less :- Adjustments for EVA - - - 250.56 - - 1.03 Proforma adjusted Net Income 152.99 6,733.73 6,186.70 3,432.94 22.82 22.83 14.12

USD Rupees RupeesEarnings Per Share 0.32 14.03 12.89

% of RevenueRs Million

INR numbers of Q2 FY06 are converted to USD on convenience translation basis @ Rupees 44.015 per USD

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COR – SG&A Details - QuarterlyCOR (Rs Million) Q2 FY06 Q1 FY06 Q2 FY05 Q2 FY06 Q1 FY06 Q2 FY05

Employee Cost 12,338.05 11,122.34 10,927.09 41.80 41.05 44.95 Equipment & Software 1,771.67 1,101.83 1,224.51 6.00 4.07 5.04 Depreciation 414.94 382.82 239.72 1.41 1.41 0.99 Travel 508.42 627.11 518.59 1.72 2.31 2.13 Communication 284.27 224.67 184.53 0.96 0.83 0.76 Other Costs 524.97 545.10 305.70 1.78 2.01 1.26

Cost of Revenue 15,842.34 14,003.88 13,400.14 53.68 51.69 55.13

S G & A (Rs Million) Q2 FY06 Q1 FY06 Q2 FY05 Q2 FY06 Q1 FY06 Q2 FY05

Employee Cost 3,094.67 2,878.65 2,004.45 10.49 10.62 8.25 Bad Debts & Provisions for Doubtful Debts 96.52 110.84 15.31 0.33 0.41 0.06 Depreciation 174.59 156.69 117.09 0.59 0.58 0.48 Rent 451.93 393.59 294.12 1.53 1.45 1.21 Travel 292.32 328.68 219.07 0.99 1.21 0.90 Communication 194.93 204.18 172.24 0.66 0.75 0.71 Recruitment & Training 143.45 134.20 102.04 0.49 0.50 0.42 Professional Fees 212.08 216.79 285.05 0.72 0.80 1.17 Other Costs 969.23 1,141.08 856.63 3.28 4.21 3.52 Research and development 120.44 107.19 68.40 0.41 0.40 0.28

S G & A expenses 5,750.16 5,671.88 4,134.40 19.48 20.93 17.01

Rs. Millions % of Revenue

Rs. Millions % of Revenue

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US GAAP Balance SheetConsolidated US GAAP

Rs Million % Rs Million %Source of FundsShareholders Funds 40,438.95 68.43 31,977.31 65.38 Short term borrowings 991.97 1.68 1,927.80 3.94 Current liabilities 15,793.44 26.72 13,196.49 26.98 Minority Interest 1,416.15 2.40 1,322.92 2.70 Other non-current liabilities 457.28 0.77 483.51 0.99 Total Liabilities 59,097.80 100.00 48,908.03 100.00 Application of FundsProperty & Equipment 12,446.33 21.06 10,869.54 22.22 Intangible assets and Goodwill 679.73 1.15 530.21 1.08 Investments 5,148.79 8.71 4,196.92 8.58 Cash and Cash equivalents 3,527.22 5.97 2,632.58 5.38 Current assets 34,348.37 58.12 28,059.28 57.37 Other Non Current assets 2,947.36 4.99 2,619.50 5.36 Total assets 59,097.80 100.00 48,908.03 100.00

31-March-200530-September-2005

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© Tata Consultancy Services ltd. 11 October 2005 16

Operational Performance

TCS Hyderabad – Deccan Park

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Growth by Market

Geography % Q2 FY 2006 Q1 FY 2006

Americas 59.7 59.0 Europe 21.8 23.5 India 12.6 11.7 Others 5.9 5.8

Total 100.0 100.0

12.6%5.9%

21.8% 59.7%

Americas

Europe

India

Others

TCS achieved an impressive sequential growth (10%) in North America.This quarter has seen good customer acquisition in Europe that will contribute to growth from Q3 onwards.Large deal wins have started showing revenue growth in the Indian market.Asia Pacific has been steady in acquiring new clients – especially in Manufacturing and BFSI segments. MEA has seen three large multi-million dollar wins during the quarter. We have also witnessed wins of TCS products in this market.The Latin America market is maturing in size for TCS. We won two deals of $25m+ in this quarter making use of our GDC in Brazil.

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Growth by Domain

18.3%

14.6%

3.8%

6.8%

3.6%2.6%

9.0%

41.3%BFSI Manufacturing Telecom Life Sciences & Healthcare Retail & Distribution Transportation Energy & Utilities Others

IP Revenue % Q2 FY 2006 Q1 FY 2006

BFSI 41.3 40.8 Manufacturing 18.3 17.1 Telecom 14.6 14.6 Life Sciences & Healthcare 3.8 4.9 Retail & Distribution 6.8 7.3 Transportation 3.6 3.8 Energy & Utilities 2.6 2.4 Others 9.0 9.1

Total 100.0 100.0

Healthy ramp-ups during the quarter with existing TCS customers. TCS’ domain expertise is receiving strong acknowledgement from large customers – Five major wins in BFSI during the quarterTCS signed up a large outsourcing deal with a Retail major in North America TCS was selected by a European utility major in a large Enterprise Transformation Initiative valued at $15mWe are witnessing strong growth in Asia for our Telecom offeringsTCS signed its first Clinical data analytics deal (KPO) during the quarter with a European Pharma major.

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Growth by Service Line

70.3%

23.4%

2.7%3.6%

Application Development & Maint. Enterprise Solutions Asset Leveraged Solutions Others

SP Revenue Growth % Q2 FY 2006 Q1 FY 2006

Application Development & Maint. 70.3 72.0 Enterprise Solutions 23.4 21.7 Asset Leveraged Solutions 2.7 3.0 Others 3.6 3.3

Total 100.0 100.0

We continue to see momentum in large application outsourcing opportunities.The Enterprise Solutions is continuing to drive revenues across verticals –particularly in Manufacturing, Pharma, and Retail segments. TCS was selected by a leading Finance company for an end-to-end business transformation initiative in North America – valued $10m+TCS products Quartz, NCS, finDNA, IIMS and eClearSettle – all had major client wins during the quarterTCS growth engines BPO(8), Infrastructure (18) and EIS (18) – all had good ramp-ups as well as new client additions.

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Operational Parameters

Revenue % Q2 FY 2006 Q1 FY 2006

Delivery Location*

Onsite 62.90 63.20 Offshore 37.10 36.80

Contract Type

Time & Material 49.30 47.90 Fixed Price & Time 50.70 52.10

* Excluding Domestic Clients

The movement of work towards offshore is happening with all large clients.

However, the newly won outsourcing deals are undergoing transition onsite in short-term.

The mix of Time and Material vis-à-vis Fixed Price is as per plan. We intend to maintain this mix.

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Client ParametersQ2 FY 2006 Q1 FY 2006

Clients Contribution *Revenue %Top 1 5.80 5.00 Top 5 17.10 18.20 Top 10 28.00 29.20

US$ 1 mln Clients 233 219US$ 5 mln Clients 84 79US$ 10 mln Clients 50 45US$ 20 mln Clients 29 27US$ 50 mln Clients 5 5

* LTM

The revenues from GE contributed to 12.30 % of the international revenues –down from 13.10 % in Q1 FY 06

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Client Acquisition and Expansion

Particulars Q2 FY 2006 Q1 FY 2006

Active Clients 624 553New Clients 74 68

Revenue % from Repeat Business 96.50 98.50 Revenue % from New Business 3.50 1.50

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Client and Delivery HighlightsTCS core banking solution at State Bank of India has been successfully implemented in over 5000+ branches. Two of the State Bank subsidiaries, State Bank of Patiala and State Bank of Travancore are fully under the core banking solution. The implementation at Indian Bank crossed the 100 branches mark.TCS successfully implemented its depository and clearing solution eClearSettle for a Middle-Eastern financial exchange. This is considered as an international benchmark for end-to-end deployment timeline.TCS successfully implemented an end-to-end business transformation programme for a leading Insurance company in North America. TCS defined and implemented a data warehouse architecture to achieve process intelligence for a Pharma major in the US.For a leading retail research company, TCS BPO delivers 300,000 reports every month with an accuracy of 99.98%.TCS EIS practice implemented an e-matrix based solution for a large medical equipment manufacturer to achieve FDA compliance in their manufacturing and supply chain processes.TCS overseas GDCs in Brazil(3), China(5), Hungary(2) and Uruguay(4) added a number of new clients during the quarter. The size and scope of these engagements are increasing.

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Representative Wins

We are experiencing large wins that fully leverage our Global DeliveryCentres in Hungary, Latin America and China.

TCS’ $250m+ deal with ABN AMRO once again sets the benchmark for large outsourcing deals to India. In India, Tata Teleservices outsourced all their IT operations and application services to TCS in a contract worth $250m

A leading US Retailer selected TCS as its strategic IT partner on a multi-year contract.

Two large US insurance providers selected TCS as their strategic partner during the quarter. Another leading bank selected TCS as its partner for their Latin American operations in a multi-year, multi-million dollar deal.

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Representative Wins

One of the largest engineering, construction and oil-field services company selected TCS for providing state-of-the-art GIS solutions.

TCS’ Insurance product IIMS was selected by a global insurance company for their China and Korean subsidiaries. It will be their next generation solution platform for providing group and individual life products.

A leading investment bank and brokerage house in Chile selected TCS’Quartz as their platform.

TCS’ anti-money laundering solution finDNA was selected by two major financial institutions in the US.

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© Tata Consultancy Services ltd. 11 October 2005 26

Profiles of ‘Select’ Growth Engines

TCS America – New Jersey

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BPOWe added 8 new clients in transaction processing during the quarter.

47 active customers as of Q2.

Three of the existing clients ramped sizable additional FTEs during the quarter.

2312 Employees as of Q2.

TCS’ new BPO Centre in Chennai became operational during the quarter with a capacity of over 1000 seats.

Significant deals –

A leading US retailer selected TCS for analytics process

A major European bank selected TCS for their Fixed-Income process

A leading US Semi-conductor equipment company selected TCS for Supply Chain processes

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28

Assurance ServicesAssurance Practice won 6 new clients during the quarter.

64 active customers as of Q2.

TCS’ “Testing CoE” offering is gaining acceptance with large customers

Representative engagement wins –

Business Acceptance testing for a leading financial services company in Europe

End-to-end test automation for a leading telecom equipment manufacturer in North America

Enterprise testing strategy development for a leading manufacturing company in Asia Pacific.

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Consulting ServicesTCS successfully integrated its consulting delivery into the TCS’ Global Delivery Model.

We added 10 new customers during Q2

We won 40 new consulting engagements during Q2

Comprehensive research desk set-up

Key Engagements –

A leading telecom service provider achieved a $10 million savings through operational excellence programs advised by TCS Consulting.

For a leading utility company in the UK, TCS Consulting is implementing a “customer transformation” program covering change management and organization readiness and re-structuring.

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Engineering & Industrial ServicesEIS practice added 18 new clients during Q2

2858 employees as of Q2

Key wins during the quarter –

A leading UK aerospace company has engaged TCS for providing CAMsolutions

World’s leading home and business audio systems company selected TCS for implementing its PLM strategy

A large producer of semiconductor equipments in North America chose TCS as its engineering services partner.

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IT Infrastructure Services

IT IS practice added 18 new clients during Q2.

102 active clients as of Q2

2050 employees as of Q2

Key engagements

A leading North American Bank chose TCS’ IT IS practice as its strategic partner. We are engaged in a host of services including Server consolidation, Performance management, Network monitoring and Data centre management.

A leading UK based global insurance company has engaged TCS for providing security and access management services.

TCS will provide a total end-to-end infrastructure management and services for Tata Teleservices in a deal worth $250 million over five years.

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© Tata Consultancy Services ltd. 11 October 2005 32

Human Resources

TCS Thiruvanathpuram – Training Center

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Total Employees in TCS is 53,329

4,2524,464

47,90643,68240,99239,217

36,696

4,722

5,423

5,029

0

10,000

20,000

30,000

40,000

50,000

60,000

Q2-05 Q3-05 Q4-05 Q1-06 Q2-06

Associates in TCS Ltd Associates in subsidiaries

Of this TCS is 47,906 and it’s Indian subsidiaries, i.e. CMC, AFS, ASDC, BTS and WTI is 5,423.

In TCS ltd India, we have 43,916 employees in Consulting and 1,952 employees in Corporate Functions.

TCS has 1,832 employees in it’s overseas subsidiaries and 206 employees in it’s overseas branches.

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4,769

3,239

2,631

3,913

5,596

2,690

1,775

3,974

2,521

0

1,000

2,000

3,000

4,000

5,000

6,000

Q2-05 Q3-05 Q4-05 Q1-06 Q2-06

Gross Additions

Net Additions

TCS Added A Gross Of 5,596 Employees & Net of 4,224 Employees.

We added 3,325 Trainees and 1,865 Experienced Professionals.

We added 369 employees in our Overseas Subsidiaries and 37 employees in our Overseas Branches.

Our utilisation excluding trainees is 78.05% and 74.97% including trainees

4,224

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35

Globalization and Diversity

No of Employees in GDCs

1,3701,3321,223

1,086

920

0

200

400

600

800

1,000

1,200

1,400

1,600

Q2-05 Q3-05 Q4-05 Q1-06 Q2-06

Employee strength in our Global Development Centres (GDCs) increased to 1,370 from 1,332.

Employee strength of non Indian nationals increased to 3.9% from 3.7% in Q1- 06.

We employ people across 49 different nationalities.

We employ 10,910 women comprising 23% of our workforce.

53% of our employees have more than 3 years of work experience.

Non Indian Nationals (%)

3.9

3.7

3.53.4

3.1

2

3

4

Q2-05 Q3-05 Q4-05 Q1-06 Q2-06

Perc

enta

ge o

f Tot

al M

an-P

ower

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Attrition

In TCS, our attrition rate for the Last Twelve Months (LTM) was 8.7% as compared to 8.2% ( Q1- 06).

1,372 employees have left us in Q2 – 06 of these 123 (about 9%) were low performers.

7.9

7.6

8.0

8.2

8.7

7

7.2

7.4

7.6

7.8

8

8.2

8.4

8.6

8.8

Q2-05 Q3-05 Q4-05 Q1-06 Q2-06

valu

e In

Per

cent

age

TCS

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Our Achievements

“Best Employer in IT, India”

Data Quest Survey, 2005

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Thank You!