TCS and GE enter into strategic alliance to expand industrial internet

India's largest Information Technology (IT) service company Tata Consultancy Services (TCS) informed stock exchanges that as a new member of the GE Digital Alliance Program, it would develop digital solutions that would increase the productivity of mobile workforces and assets in motion by leveraging Predix, GE’s cloud platform for industrial internet.

TCS and GE will work together to create an ‘industry solutions ecosystem’ by leveraging TCS's business and digital expertise to enrich GE’s Predix platform. It has already developed new internet of things solutions on the Predix platform, such as Satellite Image Analytics, Supply Chain Monitoring, Prognostic Maintenance, and Engine Telematics. It has the largest pool of experts trained on the Predix platform and is expanding its global team to support the growth in industrial internet. It will train an additional 1,000 developers in 2016.

Anupam Singhal, vice-president, Tata Consultancy Services said “We see great opportunities in leveraging our global industry expertise and assets, enriching GE’s Predix platform to drive favourable business outcomes for customers.”

On financial front the consolidated net revenue from operations of TCS reached Rs 27364 crores in Q3FY16 compared to Rs 24501 crores in Q3FY15, an increase of 11.68 per cent year on year (YoY). The EBITDA stands at Rs 7715 crores this quarter, as compared to Rs 7048 crores in Q3FY15, an increase of 9.47 per cent YoY. EBITDA margin this quarter stands at 28.19 per cent, as compared to 28.77 per cent in Q3FY15. The net profit stands at Rs 6083 crores in Q3FY16 compared to Rs 5327 crores in Q3FY15, an increase of 14.19 per cent YoY. 

On sequential basis the revenue from operations of company in Q3FY16 increased by 2.87 per cent QoQ. The EBITDA and net profit decreased by 1 per cent and 0.02 per cent QoQ, respectively. The EBITDA margin declined to 28.19 per cent in Q3FY16 from 28.68 per cent in Q2FY16. The net profit margin declined to 22.23 per cent from 22.40 per cent in Q2FY16. 

On valuation basis the Trailing Twelve Month (TTM) P/E of company is at 22.15 compared to industry P/E of 20.86. The stock of company is trading at Rs 2320, an increase of 0.02 per cent from the previous close.