Of course, the biggest event for TCS this year was the long awaited IPO seeing the light of day. While the year started off with TCS preparing itself for the grand event at feverish pitch, it ended with a shock of sorts when it announced flat growth and dip in profits for the fourth quarter. While the phenomenon was suitably explained using a combination of accounting mechanics and purposeful business decisions, it left an impression that TCS, though the largest Indian IT company, was not in a position, yet, to win over the investor community.

HIGHLIGHTS Improved revenue growth rate to 66% and delivered net profit increase of 24% Added 246 new clients The "Value Engine" program received a lot of traction with customers The largest employer in IT with 40,992 employees, but managed to keep attrition rate within 8% 10 global customers leveraged TCS' development centres outside India Cautious with acquisitions TCS does not have recognizable entities in either consulting at the top end, or BPO at the lower end l CEO: R Ramadorai l Start-up Year: 1968 l Products & Services: IT consultancy and software services l Branches: 107 l Address: Air India Building, 11th Floor, Nariman Point, Mumbai-400021 l Tel: 56689999 l Fax: 56689455 l Website: www.tcs.com

Nonetheless, Ramadorai and his team urged upon the investor and the analyst community to look at the superlative annual growth TCS had posted for FY 2004-05. The consolidated revenues of TCS Ltd, the new entity, grew by a staggering 66% to touch Rs 9,680 crore. If you exclude CMC revenues, growth stood at 52%.

Exports continued to be the mainstay but the performance in the domestic market merits special mention. With CMC revenues included, TCS crossed the Rs 1,000 crore mark to net Rs 1,403 crore in domestic revenue. Even without CMC, the domestic revenues of TCS alone grew 84% to touch Rs 589 crore.

Net profit grew by 24% to touch Rs 1,977 crore even as CMC tried getting out of hardware to boost margins; sales and general administration expenses dropped from 20.3% to 18.8 % annually, and nearly Rs 35 crore worth of GE projects were moved offshore. Moving this chunk of GE projects offshore had two other impacts: the share of GE revenues or the GE dependence came down by nearly a percentage point and it had its consequent impact on the topline.

Strong growth in the non-US markets like Europe, India, and Asia Pacific markedly brought the US revenue share of total revenues down to 51% this year from 67% last year. TCS still has a higher share of onsite revenues at 61.3% compared to its peers.

Analysts point out that the business model followed by TCS is ridden with unpredictability of revenues. TCS reiterates that it loathes to give q-by-q guidance, but the investor and the analyst community is used to getting 'good' news every quarter. Unforgiving as they may seem, TCS needs to sweeten its communication with the investor community.