{"id":220135,"date":"2025-01-21T00:09:02","date_gmt":"2025-01-21T00:09:02","guid":{"rendered":"https:\/\/news.talkwithrattan.com\/index.php\/2025\/01\/21\/it-companies-lean-on-small-deals-to-drive-growth-the-times-of-india\/"},"modified":"2025-01-21T00:09:03","modified_gmt":"2025-01-21T00:09:03","slug":"it-companies-lean-on-small-deals-to-drive-growth-the-times-of-india","status":"publish","type":"post","link":"https:\/\/news.talkwithrattan.com\/index.php\/2025\/01\/21\/it-companies-lean-on-small-deals-to-drive-growth-the-times-of-india\/","title":{"rendered":"IT companies lean on small deals to drive growth – The Times of India"},"content":{"rendered":"
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BENGALURU: Even as cost takeout and vendor consolidation dominate client conversations, some of the large IT firms pointed out that growth was driven by small and mid-sized deals in the Dec quarter. Deal activity in the recent quarters have leaned towards small and mid-size deals especially when large-deal activity was muted. The pipeline remains strong, and the deal decision-making cycle shortened in the Dec quarter compared to the Sept quarter.
Take HCLTech, for instance. The company saw a revival in smaller deals in the Dec quarter, even as there was a broad-based pick-up in the demand environment, and the decision-making cycle shortened. HCLTech CEO C Vijayakumar said, \u201cThe average duration of signed deals is getting shorter, which means the tenure of the deals is coming down. The shift towards shorter tenure deals naturally leads to a moderated total contract value, but the more important metric in this context is annual contract value, which is good on a year-on-year basis. Our annual contract value is up 9% quarter-on-quarter and 23% year on year,\u201d he said during the earnings calls.<\/p>\n

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HCLTech won 12 deals, seven from services and five from software, in this quarter. The total contract value for Q3 stood at $2.1 billion, with small deals growing stronger than the large deals and getting broken into smaller contracts. \u201cThis growth in small deals won is what we would want to see as it is also in line with the client spend patterns,\u201d he added.
TCS signed deals worth $10.2 billion. \u201cWe achieved significant large deal wins across various markets and industries, resulting in a double-digit growth in TCV year-on-year. This performance is particularly noteworthy given the absence of any mega deal wins,\u201d said TCS CEO K Krithivasan. \u201cWe looked at deals that are more than $20 million and above; there is a deal cycle reduction also, which also shows that the decision-making is improving largely.\u201d Brokerage firm BNP Paribas said, like TCS, HCLTech also highlighted a recovery in discretionary spending across verticals, except for lifesciences & healthcare, and public services. HCLTech is seeing smaller deals growing faster than larger deals and deal tenures shortening. Hence, it expects ACV (annual contract value) growth to be much stronger than TCV growth.<\/div>\n<\/div>\n