IT deal momentum picks up sharply

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BENGALURU: The IT services deal momentum picked up sharply in the September quarter after a lull in the preceding one. Companies globally are seen to be recognising the value of going digital, given the disruptions caused by the pandemic.
In the September quarter, TCS‘s deal wins improved to $8.6 billion, a 24% increase from the June quarter. It won a $2 billion deal from European insurer Phoenix Group. It previously had a contract with the Phoenix Group under which some 5.5 million policies are under the former’s administration.
The new deal also involves expanding TCS’s Scottish presence and establishing a technology and operations service hub in Edinburgh. “The work had already commenced, and the deal got signed during the last quarter,” TCS CEO Rajesh Gopinathan told TOI.

TCS also had three key wins in the BFSI space, including Emirates NBD, where it is deploying a centralised international payments hub.
Infosys won its largest deal ever, the $1.5-billion Vanguard deal, in August. Infosys said around 1,300 Vanguard roles supporting the full-service recordkeeping client administration, operations, and technology functions will transition to Infosys. Other wins include US-based Old National Bank and National Bank of Bahrain.
Infosys said large deal wins in Q2 was the highest ever, at $3.1 billion. “We won 16 large deals in Q2 out of which six deals were in financial services, three deals in retail, two deals each in communication and high-tech,” the company said. Infosys CEO Parekh said the large deal pipeline remained strong as clients looked at accelerating digital transformation programmes and continuing their focus on automation and cost efficiency.
Wipro bagged a multi-year deal from Marelli for engineering services that’s valued at $250 million. Marelli is one of the world’s leading global independent suppliers to the automotive sector with operational headquarters in Saitama, Japan, and Corbetta, Italy. This is the second deal win for Wipro from Marelli. Earlier this year, it signed a contract with the latter for IT services.
HCL Technologies has won an over $600 million deal from Swedish telecommunications major Ericsson. The contract is for five years and it bundles infrastructure management, cloud and application services. HCL also signed 15 transformational deals, led by key industry verticals including life sciences and healthcare, public services (energy & utilities) and manufacturing.
A recent report by Goldman Sachs said a majority of these deals have components of digital transformation involving cloud migration, SaaS implementation like SAP S4 Hana, platform-led automation, and product sales including core banking software like TCS’s BaNCS and Infosys’s Finacle. “Apart from these deal win announcements, every major IT service vendor that we see has guided for a significant increase in their deal pipeline. Majority of these deals are still small while the larger deals are taking time for closure, as decision-making around discretionary IT spending remains weak given the Covid-19 pandemic,” it said.



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