Performance & Contribution towards Exports by IT-ITES Industry

Revenue

As shown in figure 1, Indian IT-ITES industry revenue is estimated at USD 129.5 billion in FY2015-16 as compare to USD 118.8 billion in FY2014-15, registering an increase of around 9.0%. The overall industry’s growth of this sector over the last five years is given in the table below.

IT – ITES Industry Revenue Trends (in USD billion)

Year/ Description

2011- 12

2012- 13

2013- 14

2014- 15

2015- 16(E)

CAGR %

(2011-16)

Exports

68.8

76.5

87.3

97.8

107.8

12.81

Domestic

19.0

19.2

19.0

21.0

21.7

4.64

Total

87.8

95.7

106.3

118.8

129.5

11.16

Source: Nasscom, E: Estimate

 

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Exports

As shown in figure 2, IT-ITES exports is estimated to gross USD 107.8 billion in FY2015-16, growing by 9.0% over FY 2014-15 and contributing nearly 83% of the total IT-ITES revenues (excluding hardware). A combination of solutions around disruptive technologies such as SMAC (Social media, mobility, analytics and cloud), artificial intelligence, embedded systems etc. have become the life-force of the industry.

During FY 2015-16, IT services exports (excludes BPO, Engineering, R&D and Software products) is expected to register an y-o-y growth of over 10.3%, generating exports of USD 61.0 billion, driven by collaboration, communication, business intelligence projects, and integration of SMAC services with traditional offerings. During FY 2015-16, ITES/BPO exports are likely to be USD 24.4 billion with a growth rate of ~8.4% over FY2014-15. Software products and ER&D segment is estimated to generate exports of US$ 22.4 billion in FY 2015-16 with y-o-y growth rate of ~12%. The domain specific solutions focusing on convergence, customization, efficiencies and localization, M2M technology and newer technologies around SMAC are playing a significant role in driving the growth of ER&D and software products. With over 3,100 firms, India is emerging as a hotbed for software products with SMAC and a supportive ecosystem creating successful stories.

Segment wise export Revenue Trends in IT – ITES Industry (in USD billion)

Year/ Description

2011- 12

2012- 13

2013- 14

2014- 15

2015- 16(E)

CAGR %

(2011-16)

IT Service

39.9

42.9

49.2

55.3

61.0

12.73

ITeS-BPO

15.9

18.3

20.4

22.5

24.4

11.43

Software Products,

Engineering Services, R&D

13.0

15.3

17.7

20.0

22.4

14.46

Total IT-ITeS

68.8

76.5

87.3

97.8

107.8

12.81

Source: Nasscom, E: Estimated

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As per figure 3, the IT Services exports accounts for the largest share of 57.76 %; BPO exports contributing 21.62 % followed by ER&D and software products that together account for 20.62%.

 

IT-BPO Revenue Share (Year 2015-16)

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Domestic Market

As shown in figure 4, Domestic IT-ITES revenue (excluding hardware) is estimated to reach INR 1408 billion in FY2015-16, as compared to INR 1289 billion in FY2014-15, a y-o-y growth of ~9.22%. During FY2014-15, domestic IT services growth is likely to be at 9.67% as large enterprises exhibit cautious spending pattern; driven by technology upgrades in BFSI, telecom and State Governments, and compliance of MIS investments. The domestic BPO services growth is estimated at ~8.72% in FY2015-16, driven by demand from select customers reverting to outsourcing business processes, especially from the BFSI, automotive and retail sectors. Domestic software products is estimated at 8.22% due to increased demand for retail, healthcare, education, manufacturing (vertical-specific) and SMAC (Social media, mobility, analytics and cloud) - based solutions.

Segment wise Domestic Revenue Trends in IT – ITES Industry (in INR Crores)

Year/ Description

2011- 12

2012- 13

2013- 14

2014- 15

2015- 16(E)

CAGR %

(2011-16)

IT Service

58907.6

66300

72721.6

81662

89562

12.33

ITeS-BPO

14849.1

17500

19593.8

21490

23364

12.97

Software Products,

Engineering Services

18009.6

20500

22468.8

25788

27907

11.91

Total IT-ITeS

91766.4

104700

114784.2

128940

140833

12.35

 

Source: Nasscom, E: Estimated

 

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