TCS says aims $3 bn back office revenue in 5 yrs

Tata Consultancy Services, India's top software services firm by sales, on Saturday said it was aiming to grow its back office services revenue to $3 billion in five years.

The company's revenue from the segment, also known as business process outsourcing, was $615 million in the last fiscal year that ended March 31. "We have an ambitious goal ... the market opportunity is clearly there," N Chandrasekaran, chief operating officer, told reporters. Back office services contributed about 11 percent to TCS's total revenue in the June quarter.

But Chandrasekaran declined to forecast how much the segment would contribute to TCS's overall revenue in five years.

TCS plans to recruit 1,500-2,000 employees, primarily in India, to ramp up its back office services business over the next 12 months, he said. Chandrasekaran said margins in back office services were a little lower than information technology services.

TCS, which published its June quarter results on Friday, beat forecasts with a 22 percent rise in quarterly profit and said the business environment remained weak and there was pressure on fees due to the global economic downturn.

Asked whether the company faced pricing pressures in the back office segment as well, Chandrasekaran said: "It's a common thing."