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Updated: May 28, 2013 23:03 IST

Cognizant pips Infosys to the post for No. 2 slot

Staff Reporter
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Lakshmi Narayanan, Vice Chairman, Cognizant Technology Solutions. File photo: G. R. N. Somashekar
BL Lakshmi Narayanan, Vice Chairman, Cognizant Technology Solutions. File photo: G. R. N. Somashekar

Tata Consultancy Services (TCS), Cognizant, Infosys, Wipro and HCL grew by 13 per cent to reach $34.3 billion in 2012, continuously chipping away at market share from large multi-national service providers, according to a recent Gartner study.

“The top five Indian providers exceeded the IT services industry’s growth of 2 per cent. However, the growth for both industry groups decelerated from 21. 8 per cent and 7.6 per cent, in 2011,” the report said.

Confirming a well-known industry trend, the study also points out that Cognizant displaced Infosys (in terms of revenue) to become the second-largest Indian IT services provider.

“Cognizant, in addition to beating Infosys, also experienced the highest growth rate among the top five providers, with an increase of 20.1 per cent in 2012,” said Arup Roy, research director at Gartner, in a statement. “In the past five years, the top five providers have been winning large outsourcing deals (those with a total contract value of more than $100 million). Their target customer segment still remains the Fortune 1000 companies. Most of these firms have a large-deal pursuit sales team that goes after deals of more than $35 million in contract value,” added Mr. Roy.

The growth rate of India-based providers has been slowing for some years, but in 2012 this trend was more pronounced, according to the study.

Another downside is that Indian outsourcing firms have not cracked into the top ten list, despite being in the industry for more than two decades.

TCS remains the closest at number 11. In addition to this trend, revenue contribution from project-based and staff augmentation deals has also continued to decline for the top five Indian-based providers.

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I worked with both Cognizant & TCS.. The reason behind Cognizant's success is it is such an employee friendly company...

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