TCS Wins Rs 15,000 Crore Order From BSNL In Telecom Push
Tata Consultancy Services and various Tata Group firms involved in telecom will deploy BSNL’s 4G network across India.
(Source: Company website)
A consortium led by Tata Consultancy Services Ltd. has won a Rs 15,000-crore order from Bharat Sanchar Nigam Ltd. in what is seen as a fillip to the telecom business of India’s largest IT services firm.
TCS, along with its Tata Group peers, has received an advance purchase order from BSNL for the deployment of 4G across India, according to an exchange filing on Monday. When contacted, the software services firm declined to furnish any more details about the contract.
The BSNL deal comes at a time when the Tata Group is said to be readying a telecom original equipment manufacturer, building on with synergies from TCS’ telecom vertical, Tejas Networks Ltd., Tata Elxsi Ltd., and Tata Communications Ltd.
Tejas Networks—acquired by TCS in July 2021—is a beneficiary of India’s telecom capex cycle, led by mobile data consumption, 5G rollouts, and an expanding broadband network. In March 2022, the telecom equipment manufacturer acquired Saankhya Labs to enhance its wireless offerings.
The contract will also add to the list of TCS’ telecom clients, which includes the likes of AT&T Inc., Ericsson SA, and Cisco Inc. In FY23, the company’s revenue from the telecom and media vertical stood at $4.7 billion, or 17% of overall earnings.
BSNL Revival
The plans for BSNL’s 4G rollout come more than six months after the central government approved a Rs 1.64 lakh crore revival package for the state-run telecom operator.
The package, for a period of four years, involves a cash support of Rs 43,964 crore and a non-cash support of Rs 1,20,192 crore. The key components of the cash support are spectrum costs, capex investment, and viability gap funding.
The cabinet, headed by the prime minister, has also approved the allocation of administrative spectrum for 4G and 5G services to BSNL. It has approved capex for the state-owned carrier to upgrade network infrastructure, including upgrading 1.2 lakh telecom sites.
Big Deal
The BSNL contract is the third-largest deal that TCS has struck in 2023, amid a lacklustre dealmaking environment.
In February, London-based Phoenix Group Holdings Plc signed a contract worth more than £600 million with the Indian IT bellwether to digitally transform its product offering. In April, TCS extended its partnership with Marks and Spencer Plc to transform the latter’s core technology stack.
On Monday, shares of Tata Consultancy Services rose 2.37% to Rs 3,297.95 apiece on the BSE even as the benchmark Sensex ended the day 0.38% higher at 61,963.68 points.
