India is the largest sourcing destination for the IT sector, contributing significantly to its GDP and global exports. Major players include TCS, Cognizant, Infosys, Wipro, and Hewlett-Packard, with IT services and business process management being key market segments. The future outlook predicts the sector will reach $225 billion by 2020 and $350 billion by 2025, supported by government initiatives like the Digital India program.

1. THE INFORMATION
TECHNOLOGY SECTOR
By – Pravin Kumar
IILM GSM

2. Overview of IT sector
• India is the world's largest sourcing destination for the
information technology (IT) industry, accounting for
approximately 67 percent of the US$ 124-130 billion
market.
• India is also gaining prominence in terms of intellectual
capital with several global IT firms setting up their
innovation centers in India.
• The sector is expected to contribute 9.5 per cent of India’s
Gross Domestic Product (GDP) and more than 45 per cent
in total services export in 2015-16.
2 2

3. Current Status
• The top five IT firms contribute over 25 per cent to the total
industry revenue, indicating the market is fairly
competitive.
• TCS is the market leader, accounting for about 10.4 per cent
of India’s total IT & ITeS sector revenue in FY16.
24 29 32 32 32 48 52
50 59 69 76 86
98.5 108
FY10 FY11 FY12 FY13 FY14 FY15 FY16E
Market size
Domestic Export
3 3

4. SEGMENTS OF IT SECTOR
• The Indian IT and ITeS industry is divided into four major
segments – Segments
•IT Services
oMarket Size:
USD75 billion
during FY16E Over
81 per cent of
revenue comes
from the export
market.
Business process
Management(BPM)
Market size: USD28
billion Around 87
per cent of revenue
comes from the
export market
S/W Product And
Engineering Services
Market size: USD27
billion during FY16E
• Over 83.9 per cent
of revenue comes
from exports
Hardware
Market size:
USD13.3 billion
during FY16E
4 4

5. FINANCIALANALYSIS
25
35.5 39.9 43.9 52 55 6111.7
14.1
15.9
17.8
20
23
24.4
10
11.4
13
14.1
14.6
20
22.4
0
20
40
60
80
100
120
FY10 FY11 FY12 FY13 FY14 FY15 FY16
Growth in export revenue(US $Bn)
IT BPM S/W & Engg Services
5 5

6. Sector Wise Break-up of Export
Revenue
56%
23%
21%
FY16
IT BPM S/W & Engg Ser.
6 6

7. Major Players
The Top Five Major players of IT industry in India are -
1. TCS
2. Cognizant Technology Solutions
3. Infosys Technologies
4. Wipro
5. Hewlett-Packard India
7 7

8. Porter’s Five Forces Model in IT
Industry
8

9. Future Perspectives
• IT sector constitute 17% of our GDP where Bangalore
(Silicon Valley) alone constitute 77% of it.
• The social media is the second most lucrative segment for
IT firms, offering a US$ 250 billion market opportunity by
2020.
• India’s IT industry is “well on track” to achieve $225 billion
in revenues by 2020 and $350 billion industry by 2025 with
digital emerging as one of the biggest opportunities, the
report said
9 9

10. Government Regulations and
Initiatives
• The Government of India has launched the Digital India program to
provide several government services to the people using IT and to
integrate the government departments and the people of India.
• The Government of Telangana has begun construction of a
technology incubator in Hyderabad—dubbed T-Hub—to reposition
the city as a technology destination
• The Department of Electronics and Information Technology (DeitY)
plans to start a digital literacy programmer, aimed at training over
six crore Indians in the next three years to empower them for digital
inclusion.
10

11. Questions ?
11