(This list does not include companies, such as Cognizant, which are US listed companies but have significant offshore operations in India. In 2004-05, Cognizant recorded global revenues of Rs 2906 crores, which would have placed them 5th on this list were they to be ranked. In addition, Syntel, Covansys, Intelligroup – all with a India-centric global delivery model - are excluded from this list.)

Key highlights of the Indian Software and Services sector

Rapid volume growth; clients continued to ramp up engagement sizes with leading vendors. The top 4 players alone have over 660 USD 1 million + clients, up from 441 in FY 2003-04

Indian software and services employee base has grown at a CAGR of 23.6 percent, from 242,000 in 2001-02 to 697,000 in FY 2003-04

FY 2004-05 revenue from product development & R&D services, was approx. USD 3 billion, up from USD 2.3 billion in FY 2003-04

There are around 3000 IT companies in India, and Indian IT industry is currently exporting to 150+ countries across the globe

Vendor maturity

• While India continues to lead in traditional segments, vendors are now also gaining ground in newer services such as packaged

software implementation, systems integration, network infrastructure management and IT consulting

• Quite a few Indian vendors have successfully expanded their revenue streams beyond service revenues to include earnings from exporting their own software products

• Increasing focus and spending on marketing - better articulation of the distinct value added services and approach offered by each vendor and a keener segmentation of the market

• Mid-sized companies emphasizing domain knowledge and process management skills and demonstrating the value of a focused solutions provider; walking away from price-driven deals

• Focus on improving revenue mix and increasing realizations, utilization

Integration of IT-BPO contracts is becoming more common

MNCs ramping up their captive offshore development initiatives in India

Greater adoption of global delivery model, with Indian vendors establishing their presence in high-margin segments, along with a steady growth in traditional service lines

Significant untapped potential exist at both country and industry levels and an interesting trend we have been

witnessing is the acquisition and alliance led strategy by Indian players to consolidate themselves, expand into new product and service lines and enter new markets

Methodology for ranking
NASSCOM sends out a detailed Snap Survey questionnaire annually to all its member companies, accounting for 95 percent of the Indian IT software and BPO industry revenue. Information collated through the questionnaire includes: aggregate performance; service lines; verticals and geographies. The Snap Survey form also takes into account the contribution of the 100 percent owned overseas subsidiaries after deducting all the double accounting.