TCS Annual Report 2019-20

1 N Q >>\ 8 Q NBQY TCS Annual Report 2019-20 Tata Consultancy Services is an IT services, consulting and business solutions organization that has been partnering with many of the world's largest businesses in their transformation journeys for over 50 years. TCS offers a consulting-led, cognitive powered, integrated portfolio of business, technology and engineering services and solutions. This is delivered through its unique Location TMIndependent Agile delivery model, recognized as a benchmark of excellence in software part of the Tata group, India's largest multinational business group, TCS has over 448,000 of the world's best-trained consultants in 46 countries. The company generated consolidated revenues of US $22 billion in the fiscal year ended March 31, 2020, and is listed on the BSE (formerly Bombay Stock Exchange) and the NSE (National Stock Exchange) in India. TCS' proactive stance on climate change and award-winning work with communities across the world have earned it a place in leading sustainability indices such as the MSCI Global Sustainability Index and the FTSE4 Good Emerging Index.

2 For more information, visit us at events have highlighted the importance of building organizational resilience, agility and adaptability. At the heart of any organization s resilience is its people, supported by enabling processes and technologies. Empowered people, who are driven by a sense of organizational purpose, take ownership for outcomes. They know the right thing to do during a crisis, even when no explicit directions are provided. TCS track record of navigating multiple economic cycles and technology changes over the past five decades can be traced to its culture of empowerment and its purpose-driven worldview. The company is best described by this year s theme: Purpose Driven. Resilient. these difficult times, TCS is staying close to customers and helping them develop and implement their own purpose-driven strategies, and enhance their organizational resilience and adaptability so they can survive future shocks, pivot into new business models or launch new offerings and thrive in the new normal.

3 TCST hemeFY 2018 Dawn of Business 2019 Growth and Transformation with Business 2017 Reimagining the EnterpriseFY 2016 Shaping the FutureFY 2015 Default is DigitalRecent Annual Report Themes1102-1, 102-5, 102-7 About TCS I 01 TCS Annual Report 2019-20 Board of DirectorsBoard of Directors I 02N ChandrasekaranChairmanHanne Birgitte Breinbjerg SorensenIndependent DirectorDr Pradeep Kumar KhoslaIndependent DirectorN G SubramaniamChief Operating Officer and Executive DirectorKeki M MistryIndependent DirectorFrom left to rightO P BhattIndependent DirectorDon CallahanIndependent DirectorRajesh GopinathanChief Executive Officer and Managing DirectorAarthi SubramanianDirectorRajesh GopinathanChief Executive Officer and Managing DirectorN G SubramaniamChief Operating Officerand Executive DirectorV RamakrishnanChief Financial OfficerMilind LakkadGlobal HeadHuman ResourcesRajashree RChief Marketing OfficerK Ananth KrishnanChief Technology OfficerRajendra MoholkarCompany SecretaryMadhav AnchanGeneral Counsel Legal & Corporate AffairsTCS Annual Report 2019-20 Management Team I 03 Management TeamCorporateTCS Annual Report 2019-20 Management Team I 04 Business

4 HeadsSurya KantNorth America, UK and EuropeKrishnan RamanujamBusiness and Technology ServicesK KrithivasanBanking, Financial Services and InsuranceShankar NarayananRetail, Travel and Consumer ProductsKamal BhadadaCommunication, Media and Information ServicesDebashis GhoshLife Sciences, Healthcareand Public ServicesSusheel VasudevanManufacturing and UtilitiesSuresh MuthuswamiBFSI PlatformsDear Stakeholder,Adversity, they say, is the true test of character. Your company achieved many admirable wins and milestones through the first 11 months of FY 2020. But it was in the final days of the year that the true nature of its purpose-driven worldview truly shone through. Your company prioritized the health and safety of its employees, kept customers mission-critical systems running under very difficult circumstances and pitched in to help communities across the world battle the pandemic. When we emerge out of this crisis, the world will be a very different place. We are witnessing many of those changes already.

5 With cloud and the new class of collaboration tools, people are discovering that they are able to collaborate with each other just as well working from home, as they did in person in the pre-COVID era. Employers are discovering that the productivity is just as good, if not better, in this new way of working. In many sectors, digital channels have gone from being secondary, nice-to-have options to become the primary channels, and in some instances, the only channels. Schools, colleges and even courts have shifted to an online-only mode. Farmers cooperatives are taking online orders and directly delivering fresh produce to is the transformation that we had spoken of five years go, when we said that Default is Digital, but even I am still amazed by the scale and speed of the Annual Report 2019-20 Letter from the Chairman I 05 Letter from the ChairmanTCS Annual Report 2019-20 Letter from the Chairman I 06By staying true to its purpose and its values, and helping its employees, customers and communities use the power of technology to realize their potential, your company is the embodiment of stakeholder capitalism in the true spirit of the Tata ethos.

6 Over the last five decades, your company has shown itself to be very purpose-driven, resilient and adaptable, staying relevant to its customers through multiple economic and technology cycles, and doing good for all its stakeholders. This is the secret behind its longevity and sharp shift in consumer preferences will force enterprises to significantly accelerate their digital transformation initiatives. They will also invest heavily in building resilience at every level, on the front-end as well as in back-office operations. Having pioneered Location Independent Agile and the Machine First Delivery Model, both of which are of immense value to organizations looking to build operational resilience and agility, your company is very well positioned to benefit from these back from the enterprise level and taking a more global view, I believe that the new world in which digital channels become mainstream, which I described in my book Bridgital Nation, will offer countries like India, a unique opportunity to implement large scale digital interventions that would provide its citizenry easier access to essential services, while creating millions of new jobs.

7 Your company has been at the forefront in enabling several such high-impact initiatives. TCS Financial Inclusion Network supports over 210 million no-frills accounts set up under the Pradhan Mantri Jan Dhan Yojana. The scheme has created jobs for over 100,000 banking correspondents who go out to remote villages with handheld devices to provide banking services to the are several other examples: the Passport Seva project which completely reimagined the issuance of passports, the digital transformation of India Post, the platform that supports Ayushman Bharat the world s largest, fully funded health insurance scheme covering 500 million of India s poorest, and so on. Each of these initiatives showcases the innovative use of technology to transform citizen services, enhance inclusivity and reduce inequity in staying true to its purpose and its values, and helping its employees, customers and communities use the power of technology to realize their potential, your company is the embodiment of stakeholder capitalism in the true spirit of the Tata ethos.

8 Over the last five decades, your company has shown itself to be very purpose-driven, resilient and adaptable, staying relevant to its customers through multiple economic and technology cycles, and doing good for all its stakeholders. This is the secret behind its longevity and next few months will be difficult, but your company is strong with deep relationships with customers and partners, enviable scale, a diversified business mix, a robust and resilient business model, and strong financials. It is well positioned to weather the storms ahead and take advantage of opportunities that come up during the downturn to acquire new capabilities and gain market share. In the post-pandemic world, technology will play an ever larger role in helping enterprises adapt to the new normal and differentiate themselves. Your company is well poised to take the lead in partnering customers to recover and rebound on to their growth and transformation behalf of the Board of Directors of Tata Consultancy Services, I want to thank you for your continued trust, confidence, and regards,N ChandrasekaranChairmanDear Stakeholder,It is a measure of how quickly and profoundly our world has changed, that when we look back at the year gone by, it feels like a different era altogether.

9 In FY 2020, your Company delivered revenue of `156,949 crore, growing over the prior year in reported terms, and in constant currency terms. Our operating margin continued to be best in class, at Net profit was `32,340 crore, a net margin of Our cash conversion continues to be very strong, with a cash conversion ratio of and free cash flow of `29,281 Board has recommended a final dividend of `6 for the year, bringing the total dividend for the year to `73 per share. This translates into `31,895 crore returned to shareholders in FY 2020, which is of the free cash had a very productive year, engaging with customers in their innovation, growth and transformation initiatives, expanding and deepening our relationships, deploying very impactful solutions, and winning some of our largest deals till date. However, it is our response to the events of the last ten days of the fiscal year that will be our most defining accomplishment of FY Annual Report 2019-20 Letter from the CEO I 071 Letter from the CEO1102-14 TCS Annual Report 2019-20We believe that by 2025, only 25% of our associates will need to work out of our facilities at any point of time; and every associate will be able to realize their potential without spending more than 25% of their time in a TCS with Speed and AgilityAs the pandemic spread, our priority was to safeguard the health and well-being of our employees while continuing to support our customers mission critical activities lockdowns tested the agility, resilience and adaptability of our delivery model.

10 We responded to the challenge with speed and agility, and have emerged stronger, with our model now proven to be able to adapt to even extreme shocks. From a highly centralized model, with large campuses accommodating thousands of employees, we were able to switch to an extreme form of distributed delivery, with 90% of our 448,000-strong workforce enabled to work remotely, in a matter of days. We not just enabled remote access for our associates but also calibrated our project management framework and security posture so that work could be properly allocated, governed, and reported, while maintaining our stringent security controls, and pivoted into a new operating model that we call Secure Borderless Workspaces (SBWS ).Using SBWS, we have been able to continue supporting our customers not only in their mission critical operations but also their transformational projects, just as before, without any Secure Borderless Workspaces model is an extension of the Open Agile Workspaces framework that powered the innovative Location Independent Agile model that we pioneered two years ago.