INDIA BUSINESS WORLD - FEBRUARY 16^th - FEBRUARY 29^th - 2008

TCS DRIVES AWAY WITH $120-M CHRYSLER CONTRACT

TATA Consultancy Services, the country’s largest software exporter, has said that it has bagged a multi-year contract valued at $120 million from US based automobile firm Chrysler LLC for providing a comprehensive portfolio of IT services.

TCS would deliver application maintenance and support services to Chrysler. The IT services initiative would encompass a portion of the functional areas within Chrysler, such as sales and marketing and shared services, the company said in a filing to the Bombay Stock Exchange.

Shares of TCS gained 1.04% to close at Rs 884 on the bourse on a day when the benchmark index Sensex fell 2.5% or about 458 points. IT stocks have been under pressure for the last one year after the rupee rose almost 14 per cent against the dollar. The US is the biggest market for Indian IT companies.

“In terms of deal value, it is not very significant because it a small fraction of its overall revenues. They have been winning such deals consistently and it shows that the company has a robust pipeline,” said an IT analyst with a local brokerage.

The contract is spread across multiple years and revenues will start accruing from the current quarter itself, according to a TCS spokesperson. Chrysler is already a client for the software firm.

“This growing trusted partnership is a testament to TCS’ competencies and capabilities which continue to help the customer in its business transformation by providing innovative IT services scaleable to their needs,” TCS executive director and chief operating officer N Chandrasekaran was quoted as saying in the statement.

The automotive industry is one of the focus markets for TCS. Manufacturing vertical accounted for 15.1% of the company’s financial year 2007 global revenues worth $4.3 billion.

TCS provides services to many of the automotive original equipment manufactures and tier one companies in North America, Europe and Japan.