Tata Elxsi and Tata Consultancy Services (TCS) are at the forefront of R&D investments in India’s software and services sector. However, they still fall short compared to global firms. Despite this, they outperform other Indian companies in key areas such as R&D intensity, the percentage of PhD employees, and the number of patents generated relative to revenue.
According to the report ‘State of the Industry: R&D in the Software and Services Industry in India’ by the Foundation for Advancing Science and Technology India (FAST), in collaboration with IIFL Securities, global firms surpassed Indian companies in research and development (R&D) intensity by a factor of 32 and in the proportion of PhD employees by 6.1 times. R&D intensity measures a firm’s R&D expenditure relative to its revenue, while PhD employees indicate the number of researchers within the firm. The FAST study also evaluated outputs such as patents and publications to rank the companies.
Shopify ranked first among all firms in both R&D intensity and outputs, achieving an R&D intensity of 26.8%. Significantly, all ten global firms surpassed the top-ranked Indian companies in R&D intensity. Additionally, IBM led in output metrics, with 328 publications per revenue and 1,451 patents per revenue.
Tata Elxsi achieved the highest rank among Indian firms, with a score of 15.8x, and led in both R&D intensity and outputs, according to the report. Cyient secured the second position overall. Tata Consultancy Services (TCS) ranked first among software firms and fifth overall in patents by revenue, with 654 patents. The highest proportions of PhD employees were found in Tata Elxsi, Persistent Systems, and Cyient.
Global companies produced 12.1x patents per US $ revenue as compared to Indian firms. However, Indian firms outperformed global firms in publications per US $ revenues, producing 2.6x publication by revenues.
In the Indian software sector, Tata Consultancy Services (TCS) topped the revenue charts, followed by HCL Technologies, Wipro, Infosys, and Tech Mahindra. TCS led in R&D and innovation spending, with $292 million, and ranked first with 654 patents. In addition, TCS employed 459 PhD holders, the highest among software firms, although HCL had a higher proportion of PhDs at 0.14%.
Among the lower-revenue cluster firms, Tata Elxsi ($ 6.4 million) and Cyient ($3.2 million) were the highest R&D spenders. Tata Elxsi and Cyient were spending 7.1% and 7.4% of their profits respectively on R&D. The number of PhD employees as a proportion of total employees was highest in Tata Elxsi (0.7%) and Persistent Systems (0.3%). Zensar Technologies was ranked first on the patents by $ billion revenue follwed by Tata Elxsi and Persistent Systems.
From: financialexpress
Financial News
