To the Members,
The Directors present the Annual Report of Tata Consultancy Services Limited (the Company or TCS) along with the audited financial statements for the financial year ended March 31, 2017. The consolidated performance of the Company and its subsidiaries has been referred to wherever required.
Pursuant to the notification dated February 16, 2015 issued by the Ministry of Corporate Affairs, the Company has adopted the Indian Accounting Standards ("Ind AS") notified under the Companies (Indian Accounting Standards) Rules, 2015 with effect from April 1, 2016. Financial statements for the year ended and as at March 31, 2016 have been restated to conform to Ind AS Note 3 to the consolidated financial statement provides further explanation on the transition to Ind AS.
1. Financial results
Financial Year 2016-17 (FY 2017)
Financial Year 2015-16 (FY 2016)
Financial Year 2016-17 (FY 2017)
Financial Year 2015-16 (FY 2016)
Revenue from operations
Other income (net)
Depreciation and amortization expense
Profit before finance cost and tax
Profit before tax (PBT)
Profit for the year
Shareholders of the Company
Opening balance of retained earnings
Adjustment with other equity
Amount available for appropriation
Dividend on equity shares (excluding tax)
Tax on dividends
Capital redemption reserve
Special Economic Zone re-investment reserve
Closing balance of retained earnings
(Rs,1 crore = '''' 10 million)
2. Buyback of Equity Shares
The Board of Directors of the Company at its meeting held on February 20, 2017, has approved buyback up to 56,140,351 equity shares of ''''1 each, on a proportionate basis, at a price of '''' 2,850 per equity share payable in cash for an aggregate consideration not exceeding ''''16,000 crore, excluding transaction costs viz. brokerage, applicable taxes such as securities transaction tax, service tax, stamp duty, etc., by way of a Tender Offer route through Stock Exchange Mechanism. This is in accordance with the provisions of the Companies Act, 2013 (Act), and the Securities and Exchange Board of India (Buy Back of Securities) Regulations, 1998, and other applicable laws and regulations.
The buyback is a capital allocation decision taken with the objective of seeking a fairer valuation of the Company''''s stock while improving the Company''''s Return on Equity, and increasing shareholder value in the longer term.
The offer size of the buyback is within the prescribed limit of 25% of the aggregate of paid up capital and free reserves of the Company, and represents 2.85% of the total issued and paid-up equity share capital of the Company.
Based on the Company''''s performance, the directors are pleased to recommend for approval of the members a final dividend of Rs,27.50 per share for FY 2017 taking the total dividend to Rs,47.00 per share (previous year Rs,43.50 per share). The final dividend on equity shares, if approved by the members would involve a cash outflow of Rs, 6,522 crore, including dividend tax. The total dividend on equity shares including dividend tax for the FY 2017 would aggregate Rs, 11,071 crore, resulting in a payout of 46.8% of the unconsolidated profits of the Company.
4. Transfer to reserves
The Company proposes to retain the entire amount of Rs, 65,965 crore in the profit and loss account.
5. Company’s performance
On a consolidated basis, the revenue from operations for FY 2017 at Rs, 117,966 crore was higher by 8.6% over the last year (Rs,108,646 crore in FY 2016). The profit for the year attributable to shareholders and non-controlling interests was Rs, 26,357 crore, recording a growth of 8.3% over the last year (Rs, 24,338 crore of FY 2016). The profit after tax attributable to shareholders of the Company was Rs, 26,289 crore, 8.3% higher than that of the previous year (Rs, 24,270 crore).
On an unconsolidated basis, the revenue from operations for FY 2017 at Rs,92,693 crore, was higher by 8.0% over the last year (Rs,85,864 crore in FY 2016). The profit for the year was Rs,23,653 crore, registering a growth of 2.5% over the PAT of Rs, 23,075 crore in FY 2016.
6. Human resource development
The Company is responding to the evolving needs of the Digital era by leveraging Digital technologies to enhance the scale, quality and experience of our Talent Acquisition, Talent Engagement and Talent Development programs.
In FY 2017, TCS hired 78,912 employees across the world. The Company''''s on boarding platforms give new employees a consistent, world-class integration experience. Our diversity initiatives are showing good progress. The Company has employees from 130 nationalities and is one of the largest employers of women, who constitute 34.7% of our global workforce. The Company had 387,223 employees across 55 countries, as on March 31, 2017.
TCS'''' Digital Learning platform is helping the Company reskill the global workforce quickly, and at scale. The Company''''s various employee engagement platforms and initiatives have resulted in a vibrant, productive and enjoyable work environment. A structured approach to career development, leadership development, internal job rotations, and mentoring helps employees grow their careers and realize their potential.
Programs like Fit4life, Safety First, Employee Assistance Program, and Purpose4Life are part of the total employee experience, helping to promote individual wellness while balancing the needs of work, family and society. PULSE, the Company''''s employee satisfaction survey, provides critical insights into the needs of the workforce and forms the basis of refining organizational policies and programs.
Through all these initiatives, the Company continues to remain the industry benchmark for Talent Retention. Attrition in FY 2017 reduced to 10.5% in IT Services and to 11.5% on an overall basis.
7. Quality initiatives
The Company continues to sustain its commitment to the highest levels of quality, superior service management, robust information security practices and mature business continuity management. In FY 2017, the Company was re-appraised enterprise-wide at the highest maturity Level 5 of CMMI-DEV® (Development) and CMMI-SVC® (Services) version 1.3. The Company also achieved enterprise-wide ISO certification for Quality Management (ISO 9001:2015), IT Service Management (ISO 20000-1:2011), Information Security Management (ISO 27001:2013), and Business Continuity Management (ISO 22301:2012). TCS'''' strong commitment to the environment and occupational health and safety of its employees and business partners is demonstrated through the enterprise-wide Environmental Management (ISO 14001:2004) and Occupational Health and Safety Management (BS OHSAS 18001:2007) certifications. The Company also maintain domain-specific quality certifications including AS 9100 (Aerospace), TL 9000 (Telecom) and ISO 13485 (Medical Devices).
TCS'''' Global Network Delivery Model (GNDM™), built on a strong process-driven and customer-centric integrated Quality Management System (iQMS™), continues to deliver outstanding value and experience to our customers. iQMS™ is continually enhanced for emerging service offerings, new delivery methodologies, industry best practices and latest technologies. The Company continues to invest in knowledge management platforms for effective collaboration, learning and sharing. The Company received the prestigious Most Admired Knowledge Enterprise (MAKE) award in the Global Independent Operating Unit (IOU) category for the seventh time, Asian and Indian categories for the twelfth time. For a second successive year in 2016, the Company was ranked first in the Global IOU MAKE award category.
Our customer-centricity, process rigor, and focus on delivery excellence have resulted in consistent improvements in customer satisfaction levels in the periodic surveys conducted by us. This is validated by top rankings in third-party surveys as well.
8. Subsidiary companies
The Company has 58 subsidiaries as on March 31, 2017. There are no associate companies or joint venture companies within the meaning of Section 2(6) of the Act. There has been no material change in the nature of the business of the subsidiaries.
Pursuant to the provisions of Section 129(3) of the Act, a statement containing the salient features of financial statements of the Company''''s subsidiaries in Form AOC-1 is attached to the financial statements of the Company.
Further, pursuant to the provisions of Section 136 of the Act, the financial statements of the Company, consolidated financial statements along with relevant documents, and separate audited accounts in respect of subsidiaries, are available on the website of the Company.
Restructuring or closure of unlisted wholly-owned subsidiaries during the year:
a. Tata Consultancy Services (South Africa) (Pty) Limited (TCS South Africa) : Tata Consultancy Services (Africa) (Pty) Limited (TCS Africa), wholly owned subsidiary of TCS, acquired the 25% ownership interest in TCS South Africa held by a minority shareholder in July 2016 and consequently, TCS South Africa became a wholly owned subsidiary of TCS Africa. TCS South Africa is engaged in IT services and consulting business, catering to the customers in the South Africa region.
b. Diligenta 2 Limited: A subsidiary of Diligenta Limited, the UK based subsidiary of the Company was dissolved with effect from March 14, 2017, by transfer of its employees, trade, and assets to Diligenta Limited, with the permission of the Financial Conduct Authority of the United Kingdom.
c. PT Financial Network Services Indonesia: The process of closure of this company, which is a subsidiary of Financial Network Services (Holdings) Pty. Limited, was completed and the same was effective March 16, 2017.
d. MS CJV Investment Corporation: A corporation, incorporated in the state of Nevada, USA, was dissolved with effect from January 24, 2017. MS CJV Investment Corporation''''s 4.75% holding in Tata Consultancy Services (China) Limited was transferred on December 29, 2016, to Tata Consultancy Services Asia Pacific Pte. Limited, based on a valuation report, for a consideration of RMB 9.6 million (USD 1.38 million). This company had no other investments or business.
9. Directors’ responsibility statement
Pursuant to Section 134(5) of the Act, the board of directors, to the best of their knowledge and ability, confirm that:
i. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;
ii. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;
iii. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv. they have prepared the annual accounts on a going concern basis;
v. they have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively;
vi. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
Based on the framework of internal financial controls and compliance systems established and maintained by the Company, the work performed by the internal, statutory, and secretarial auditors and external consultants, including the audit of internal financial controls over financial reporting by the statutory auditors, and the reviews performed by management and the relevant board committees, including the audit committee, the board is of the opinion that the Company''''s internal financial controls were adequate and effective during FY 2017.
10. Directors and key managerial personnel
Mr. N. Chandrasekaran relinquished his position as the Chief Executive Officer and Managing Director of the Company with effect from February 21, 2017, on his appointment as Executive Chairman of Tata Sons Limited. Mr. N Chandrasekaran demonstrated exemplary leadership during his tenure as the Chief Executive Officer and Managing Director of the Company. Prior to his elevation to the position of the Chief Executive Officer and Managing Director of the Company on October 6, 2009, he held the office of the Chief Operating Officer and Executive Director of the Company from September 6, 2008, till October 5, 2009. He joined the Company in 1987 and has held several key positions within the Company. The Directors place on record their appreciation of the invaluable services of Mr. N. Chandrasekaran as the Chief Executive Officer and Managing Director.
Tata Sons Limited nominated Mr. N. Chandrasekaran as the Chairman of the Board of Directors of the Company in place of Mr. Ishaat Hussain, with effect from February 21, 2017. The nomination was duly noted by the Board of Directors at its meeting held on February 20, 2017. Consequent to this, Mr. N. Chandrasekaran took charge as the Non-Executive Chairman of the Board of Directors of the Company with effect from February 21, 2017.
Mr. Ishaat Hussain was nominated as the Chairman of the Board by Tata Sons Limited on November 9, 2016, in place of Mr. Cyrus Mistry. Mr. Hussain presided over as the Chairman of the Board till the nomination of Mr. Chandrasekaran as the Chairman with effect from February 21, 2017. The Directors place on record their appreciation of Mr. Ishaat Hussain for presiding over the Company as the interim Chairman.
Based on the requisition of the holding company, Tata Sons Limited, an Extra-Ordinary General Meeting of the Company was convened on December 13, 2016, at which the shareholders voted in favor of removal of Mr. Cyrus Mistry as a Director. Mr. Cyrus Mistry ceased to be a Director of the Company with effect from December 13, 2016.
Mr. Phiroz Vandrevala stepped down as a Director with effect from July 8, 2016. In a career spanning over 25 years with the Company, Mr. Phiroz Vandrevala worked in various leadership roles including as the Executive Director from September 7, 2007 to May 13, 2011, and as a non-executive Director with effect from May 13, 2011. Mr. Phiroz Vandrevala took over as the Managing Director and Vice Chairman of Diligenta Limited in May 2011 to drive its business and execution globally. The Directors place on record their appreciation for the valuable contribution of Mr. Phiroz Vandrevala to the Company.
Mr. Rajesh Gopinathan, who was the Chief Financial Officer of the Company, was elevated to the position of Chief Executive Officer and Managing Director of the Company with effect from February 21, 2017. Mr. Rajesh Gopinathan started his professional career with the Company in 2001. He was appointed as the Chief Financial Officer of the Company in February 2013. He has played a key role in helping the Company become a $17.6 billion global turnover company.
The Board also appointed Mr. N. Ganapathy Subramaniam as the Chief Operating Officer and Executive Director of the Company with effect from February 21, 2017. Prior to this, Mr. N. Ganapathy Subramaniam was the President, Financial Services, a strategic business unit of the Company. He has been a part of the Company and the Indian IT Industry for the past 34 years and has had opportunities to perform a variety of roles in delivering solutions to customers globally, especially in the Banking and Financial Services sector.
Ms. Aarthi Subramanian retires by rotation and being eligible has offered herself for re-appointment.
Pursuant to the provisions of Section 149 of the Act, Mr. Aman Mehta, Mr. V. Thyagarajan, Prof. Clayton M. Christensen, Dr. Ron Sommer, Dr. Vijay Kelkar, and Mr. O. P Bhatt were appointed as independent directors at the annual general meeting of the Company held on June 27, 2014. They have submitted a declaration that each of them meet the criteria of independence as provided in Section 149(6) of the Act and there has been no change in the circumstances which may affect their status as an independent director during the year.
During the year, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, commission, and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.
The Board appointed Mr. V. Ramakrishnan as the Chief Financial Officer of the Company, to take over from Mr. Rajesh Gopinathan, with effect from February
21, 2017. Mr. Ramakrishnan has been a key member of TCS Finance for more than 17 years and has served in various leadership roles in TCS Finance. He is a graduate in commerce from Loyola College, Chennai, and is a member of the Institute of Chartered Accountants of India, the Institute of Company Secretaries of India and the Institute of Cost & Management Accountants of India.
Pursuant to the provisions of Section 203 of the Act, the Key Managerial Personnel of the Company as on March 31, 2017 are:
Mr. Rajesh Gopinathan, Chief Executive Officer and Managing Director, Mr. N Ganapathy Subramanian, Chief Operating Officer and Executive Director, Ms. Aarthi Subramanian, Executive Director, Mr. V. Ramakrishnan, Chief Financial Officer, and Mr. Suprakash Mukhopadhyay, Company Secretary. Mr. N. Chandrasekaran ceased to be a Key Managerial Personnel of the Company with effect from February 21, 2017.
11. Number of meetings of the board
Nine meetings of the board were held during the year. For details of meetings of the board, please refer to the Corporate Governance Report, which is a part of this report.
12. Board evaluation
The Board of Directors has carried out an annual evaluation of its own performance, board committees, and individual directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed by the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations 2015 (''''SEBI Listing Regulations'''').
The performance of the board was evaluated by the board after seeking inputs from all the directors on the basis of criteria such as the board composition and structure, effectiveness of board processes, information and functioning, etc. as provided by the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017.
The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of criteria such as the composition of committees, effectiveness of committee meetings, etc.
The Board and the Nomination and Remuneration Committee reviewed the performance of individual directors on the basis of criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc.
In a separate meeting of independent directors, performance of non-independent directors and the board as a whole was evaluated, taking into account the views of executive directors and non-executive directors. The same was discussed in the board meeting that followed the meeting of the independent directors, at which the performance of the board, its committees, and individual directors was also discussed. Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated.
13. Policy on directors’ appointment and remuneration and other details
The Company''''s policy on directors'''' appointment and remuneration and other matters provided in Section 178(3) of the Act has been disclosed in the Corporate Governance Report, which is a part of this report.
14. Internal financial control systems and their adequacy
The details in respect of internal financial control and their adequacy are included in the Management Discussion and Analysis, which is a part of this report.
15. Audit committee
The details pertaining to the composition of the audit committee are included in the Corporate Governance Report, which is a part of this report.
Deloitte Haskins & Sells LLP Chartered Accountants, the statutory auditors of the Company, hold office till the conclusion of the 22nd Annual General Meeting of the Company. The Board has recommended the appointment of B S R & Co. LLP Chartered Accountants as the statutory auditors of the Company in their place, for a term of five consecutive years, from the conclusion of the 22nd Annual General Meeting of the Company scheduled to be held in the year 2017 till the conclusion of the 27th Annual General Meeting to be held in the year 2022, for approval of shareholders of the Company, based on the recommendation of the Audit Committee.
Further, based on the recommendation of the Audit Committee of the Company, the Board has appointed KPMG India, Chartered Accountants, to audit the financial statements under the International Financial Reporting Standards (IFRS) for a period of five financial years from FY 2017-18 to FY 2021-22.
17. Auditors’ report and secretarial auditors’ report
The auditors'''' report and secretarial auditors'''' report do not contain any qualifications, reservations, or adverse remarks. Report of the secretarial auditor is given as an annexure to this report.
18. Risk management
The Board of Directors of the Company has formed a risk management committee to frame, implement, and monitor the risk management plan for the Company. The committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The Audit Committee has additional oversight in the area of financial risks and controls. The major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continual basis.
The development and implementation of risk management policy has been covered in the Management Discussion and Analysis, which is a part of this report.
19. Particulars of loans, guarantees, and investments
The particulars of loans, guarantees, and investments have been disclosed in the financial statements.
20. Transactions with related parties
None of the transactions with related parties fall under the scope of Section 188(1) of the Act. The information on transactions with related parties pursuant to Section 134(3) (h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure I in Form AOC-2 and the same form a part of this report.
21. Corporate social responsibility
The brief outline of the corporate social responsibility (CSR) policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure II of this report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. For other details regarding the CSR Committee, please refer to the Corporate Governance Report, which is a part of this report. The policy is available on the website of the Company.
22. Extract of annual return
As provided under Section 92(3) of the Act, the extract of the annual return is given in Annexure III in the prescribed Form MGT-9, which is a part of this report.
23. Particulars of employees
The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:
a. The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year:
Name of the directors
Ratio to median remuneration
Mr. N. Chandrasekaran *
Mr. Cyrus Mistry **
Mr. Aman Mehta
Mr. V. Thyagarajan
Prof. Clayton M. Christensen
Dr. Ron Sommer
Dr. Vijay Kelkar
Mr. Ishaat Hussain
Mr. O. P Bhatt
Mr. Phiroz Vandrevala ***
Mr. Rajesh Gopinathan #
Mr. N. Ganapathy Subramaniam ##
Ms. Aarthi Subramanian
^ Since the remuneration of these Directors is only for part of the year, the ratio of their remuneration to median remuneration is not comparable
b. The percentage increase in remuneration of each Director, Chief Executive Officer, Chief Financial Officer, Company Secretary in the financial year:
Directors, Chief Executive Officer, Chief Financial Officer and Company Secretary
% increase in remuneration in the financial year
Mr. N. Chandrasekaran*
Mr. Cyrus Mistry **
Mr. Aman Mehta
Mr. V. Thyagarajan
Prof. Clayton M. Christensen
Dr. Ron Sommer
Dr. Vijay Kelkar
Mr. Ishaat Hussain
Mr. O. P Bhatt
Mr. Phiroz Vandrevala ***
Mr. Rajesh Gopinathan #
Mr. N. Ganapathy Subramaniam ##
Ms. Aarthi Subramanian
Mr. Ramakrishnan V, Chief Financial Officer w.e.f February 21, 2017
Mr. Suprakash Mukhopadhyay, Global Treasury Head and Company Secretary
@ Mr. Rajesh Gopinathan, Mr. N. Ganapathy Subramaniam and Mr. Ramakrishnan V were appointed on February 21, 2017. Accordingly, the disclosures with respect to increase in their salary and median are not given.
@@ Increase in remuneration is not given as the concerned directors were only for the part of the year.
* Relinquished the office of Chief Executive Officer and Managing Director and appointed as a Chairman of the Company w.e.f. February 21, 2017 ** Ceased to be a Director of the Company w.e.f. December 13, 2016
*** Relinquished the office of Non-Executive Director w.e.f. July 8, 2016
# Appointed as Chief Executive Officer and Managing Director of the Company w.e.f. February 21, 2017 ## Appointed as Chief Operating Officer and Executive Director w.e.f. February 21, 2017
c. The percentage increase in the median remuneration of employees in the financial year: 4.91%
d. The number of permanent employees on the rolls of Company: 387,223
e. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:
The average annual increase was around 8% in India. However, during the course of the year, the total increase is approximately 10%, after accounting for promotions and other event based compensation revisions. Employees outside India received wage increase varying from 2% to 6%.
Increase in the managerial remuneration for the year was 31.38%.
f. Affirmation that the remuneration is as per the remuneration policy of the Company:
The Company affirms that the remuneration is as per the remuneration policy of the Company.
g. The statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure forming part of this report. Further, the report and the accounts are being sent to the members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said annexure is open for inspection at the Registered Office of the Company. Any shareholder interested in obtaining a copy of the same may write to the Company Secretary.
24. Disclosure requirements
As per SEBI Listing Regulations, the Corporate Governance Report with the Auditors'''' Certificate thereon, and the Management Discussion and Analysis are attached, which form part of this report.
As per Regulation 34 of the SEBI Listing Regulations, a Business Responsibility Report is attached and is a part of this annual report.
As per Regulation 43A of the SEBI Listing Regulations, the Dividend Distribution Policy is disclosed in the Corporate Governance Report and on the website of the Company.
25. Deposits from public
The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.
26. Conservation of energy, technology absorption, foreign exchange earnings, and outgo Conservation of energy:
The Company is committed to reduce its energy consumption through four key levers: green buildings, efficient operations, green IT and the use of renewable energy. Green buildings are energy efficient by design and hence help us reduce energy footprint. Over half of the Company''''s real estate portfolio are green buildings. Some 80% of all the TCS-owned offices are LEED/IGBC certified. The Company''''s Remote Energy Monitoring and Control initiative has enabled real-time energy monitoring and performance optimization, including that of data centers. All the owned campuses have onsite solar photovoltaic power generation. The Company has significantly increased its use of renewable power year on year. These initiatives collectively resulted in the Company''''s energy consumption reducing by 8.3% over the prior year, on a per FTE per annum basis.
Technology absorption, adaption, and innovation:
The Company continues to adopt and use the latest technologies to improve the productivity and quality of its services and products. The Company''''s operations do not require significant import of technology.
Research and Development (R&D): Specific areas in which R&D was carried out by the Company
TCS research deepened its exploration in the areas of intersection between computing and sciences; focusing on Artificial Intelligence (AI), the industrialization of software and computing, and the Digitization of business and society. Other areas of research include: an Integrated Computational Materials Platform in the materials space, the use of data science and high performance computational methods in genome analysis, met genomic bio-markers and systems biology, and modeling of human behavior to understand the needs of a Digital citizen, Digital workplaces, and Digital customer in behavioral, social, and business sciences.
TCS Research and Innovation (R&I) remained closely connected to customers. Our marquee event, the TCS Innovation Forum, attracted over 700 customers, partners, and technology experts across New York City, London, Medellin, and Sao Paulo. We conducted a track called the ''''The TCS Slush Experience'''' at Slush - Europe''''s premier startup event. Innovation Days and workshops held for customers in various locations resulted in several pilots and proofs of concept. The Company''''s Entrepreneur-in-Residence program as well as the Co-Innovation Network (TCS COIN™) continued to accelerate innovation. The latter expanded its footprint in several geographies and also deepened its academic alliances in India, extending it to Tier 1 institutions.
Your Company is again named in the Forbes list of the ''''World''''s Most Innovative Companies'''', ninth year in a row. The Company was also awarded the WIPO IP Enterprise Trophy. VeriAbs, TCS'''' V&V framework offering, came first in the Loops category in 6th International Competition on Software V&V. The TCS Remote Energy Monitoring System won the 2016 IoT Connected Building Award and the 17th National Award on Excellence in Energy Management. TCS and IIT Kanpur together ranked fifth in the Amazon Picking Challenge. TCS had three winners in Tata Innovista 2016; all six winners of the Challenges Worth Solving were from TCS. Several associates have won individual honors.
Looking forward, the Digital reimagination of industry and society and the industrialization of software and computing will continue to be focus areas for TCS R&I.
Expenditure on R&D
TCS Innovation Labs are located in India and other parts of the world. These R&D centers, certified by the Department of Scientific & Industrial Research (DSIR) function from Pune, Chennai, Bengaluru, Delhi- NCR, Hyderabad, Kolkata and Mumbai.
Expenditure incurred in the R&D centers and innovation centers of TCS during FY 2017 and FY 2016 are given below:
Expenditure on R&D and innovation
Total R&D expenditure (a b)
Innovation center expenditure
Total R&D and innovation expenditure (c d)
R&D and innovation expenditure as a percentage of total turnover
Foreign exchange earnings and outgo (Rs, crore)
Export revenue constituted 92.4% of the total unconsolidated revenue in FY 2017 (92.8% in FY 2016).
Foreign exchange earnings and outgo
Foreign exchange earnings
CIF Value of imports
Expenditure in foreign currency
The Directors thank the Company''''s employees, customers, vendors, investors, and academic partners for their continuous support.
The Directors also thank the governments of various countries, the Government of India, governments of various states in India, and concerned government departments and agencies for their co-operation.
The Directors appreciate and value the contribution made by every member of the TCS family.
On behalf of the Board of Directors
Mumbai, April 18, 2017 Chairman