software outsourcing

A blog related to software development company and offshore software outsourcing

Friday, January 13, 2006

Growth of Top Software Outsourcing Companies in India

Out of the five top software companies India, three have been listed for the market capitalization. The piece of value should settle forever and overall if you have any doubts about the top software outsourcing companies then let us get it clear in the upcoming passages and how it is helping the global scenes of the market.

The market capitalization can be defined with the number of outstanding shares, multiplied by their price, of Top Software Outsourcing Companies in India like Tata Consultancy Services, Infosys Technologies and Wipro Ltd are just below that of multinational behemoths IBM and Accenture.

So as we started discussing about Top software outsourcing companies in India lets look at TCS, with a turnover of $1.84 billion, has, as on last month of year 2005, a market capitalization of more than $18.14 billion; Infosys with a turnover of $1.57 billion, has a market capitalization of $18.13 billion; while Wipro Ltd, with a turnover of $1.6 billion, had a market capitalization of $14.53 billion, which tells the whole story.

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If considering the growth, between years 2005 to 2006 the market capitalization went up by 29.5%, 42.6% and 20.1 % respectively by these three multinational software companies.

Since market capitalization is equal to currency which can be used for takeovers, theoretically means that any one of the Indian Big Three can buy one of these rivals for cash or share swaps anytime and become 10 times their current size.

If we consider the revenue terms, multinational giants like Electronic Data Systems and Computer Science Corporations are in-between three to four times bigger than Infosys, TCS and Wipro put together, but in market capitalization terms r three, Top Software Outsourcing Companies in India are together four times as big as Electronic Data System or Computer Science Corporations.

The fact that the markets are rewarding Top software outsourcing companies in India more than their multinational peers can be gauged by the new research methodology called Relative Value of Growth. The Relative Value of Growth metric suggests that Indian IT companies like Infosys, Wipro, Satyam Computer Services and Tata Consultancy are the best top five software outsourcing companies deriving market-cap of 80 to 85% from investor growth expectation. The investment done by the citizen and client retention will be in continuity. The new metric gives the US players a dismal rating because Wall Street will not be rewarding them for growing and investing, and merely for cost cutting.

The researchers also found that Top software outsourcing companies in India were willing to invest in customers even after three and four years of the contract has finished. This timeframe is when a majority of outsourcing deals normally fall apart. Services could eventually lead on a global basis and usurp the positions of global giants in Software Outsourcing companies.