MUMBAI, JUNE 24
An annual report may not be a definitive document detailing how firms define and set strategies for competitive reasons among other things. This has been pointed out by leading brokerage house Edelweiss Securities.
The firm points out that although both Tata Consultancy Services (TCS) and Infosys have been compared on financial performance quarter after quarter there are several key operational parameters that have driven their performance over the years.
The brokerage firm extracted ten such parameters from the FY09 annual reports of TCS and Infosys and compared both the companies as regards investments in research and development (R&D), patents and non-linear growth strategies; diversification in terms of delivery centers, nationalities, expansion of sales offices; and use of sub-contractors; amongst others.
After analysis, it noted that while TCS scores on several business-related parameters, Infosys scores better at nurturing the brand and communicating through the annual report how it does so. It further noted that Infosys also has tighter integrity of financial reporting of divisional/geographic profitability.
TCS scores on dimensions that are relevant to delivery such as overseas presence, greater sub-contracting and higher foreign nationals. These are non-enduring advantages that can be closed by Infosys in the near-to-medium term, notes Edelweiss Securities.
However, the brokerage firm also notes that in both the companies there has been a maturing of workforce over FY07-09.
