Revenue
As shown in figure 1, Indian IT-ITeS industry revenue is estimated at USD 151.0 billion in FY2017-18 as compared to USD 141.0 billion in FY2016-17, registering an increase of around 7.0%. The overall industry’s growth of this sector over the last five years is given in the table below.
| Year/ Description | 2013- 14 | 2014- 15 | 2015- 16 | 2016- 17 | 2017- 18(E) | CAGR %(2013-18) |
|---|---|---|---|---|---|---|
| Exports | 87.3 | 97.8 | 107.8 | 117.0 | 126.0 | 10.49 |
| Domestic | 19.0 | 21.0 | 21.7 | 24.0 | 25.0 | 5.42 |
| Total | 106.3 | 118.8 | 129.5 | 141.0 | 151.0 | 9.55 |
Source:NASSCOM SR-2018, E: Estimate
Figure 1: Indian IT-ITeS industry revenue
As per figure 2, the IT Services exports accounts for the largest share of 57% of about US$ 86.0 Billion; ER&D and software products has emerged as the second largest segment with 21.8% share followed by BPO exports contributing 21.2%.
Figure 2: Revenue share of various segments in IT/ITeS Sector (in %) Source: NASSCOM SR-2018
Exports
As shown in figure 3, IT-ITeS exports are estimated as US$ 126.0 billion in FY2017-18, growing by 7.7% over FY2016-17. 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.
IT Services is the fastest growing segment within the Indian IT-ITeS sector. This segment is estimated to generate exports revenues of the order of US$ 69.3 billion in year 2017-18 as compared to US$ 66.0 billion in year 2016-17.
ITeS/BPO segment has been reinventing itself in the past few years and is expected to generate export revenue of the order of ~US$ 28.4 billion in year 2017-18 as compared to US$ 26 billion in year 2016-17.
Engineering R&D and Product Development has registered a growth of about 12% in the exports, which is estimated to reach US$ 28.3 billion in year 2017-18 from the level of US$ 25.0 billion in year 2016-17.
| Year/ Segment | 2013- 14 | 2014-15 | 2015-16 | 2016 -17 | 2017- 18 (E) | CAGR %(2013-18) |
|---|---|---|---|---|---|---|
| IT Service | 49.2 | 55.3 | 61.0 | 66.0 | 69.3 | 10.07 |
| ITeS-BPO | 20.4 | 22.5 | 24.4 | 26.0 | 28.4 | 9.19 |
| Software Products, Engineering Services, R&D | 17.7 | 20.0 | 22.4 | 25.0 | 28.3 | 13.09 |
| Total IT-ITeS | 87.3 | 97.8 | 107.8 | 117.0 | 126.0 | 10.32 |
Source: NASSCOM SR-2018, E: Estimated
Figure 3: Export of various segments in IT/ITeS Sector
Source: NASSCOM SR-2018, E: Estimated
Domestic Market
The Size of the domestic market is become significant now in the IT/ITeS Sector, though it largely remains export driven. As shown in figure 4, Domestic IT-ITeS revenue (excluding hardware) is estimated to reach INR 1738 billion in FY2017-18, as compared to INR 1608 billion in FY2016-17, a y-o-y growth of ~8.7%. In FY 2018, India’s domestic IT-BPM market is likely to grow 7.9% Y-o-Y to reach US$ 41 billion (~₹ 273750 crore), excluding e-Commerce as compared to US$ 38 billion in 2016-17. Rapid digitization is expected to further catalyse growth. Domestic IT-BPM industry is also seeing continued growth as various government initiatives encourage technology usage (push factor) and Indian enterprises across industries are rapidly implementing digital technologies to adapt to a changing competitive landscape and the ever-demanding customer. Domestic IT Services sector is the largest segment with close to 40.5% share, expected to reach ₹. 113600 crores in year 2017-18 as compared to ₹ 100500 crores in year 2016-17 with a estimated growth of about 13.1% in INR terms.
The IT-ITeS industry domestic revenue growth trend over the past 5 years is as under:
| Year/ Segment | 2013- 14 | 2014- 15 | 2015- 16 | 2016- 17 | 2017-18(E) | CAGR %(2013-18) |
|---|---|---|---|---|---|---|
| IT Service | 72721.6 | 81662 | 89562 | 100500 | 113600 | 11.37 |
| ITeS-BPO | 19593.8 | 21490 | 23364 | 26800 | 26800 | 8.90 |
| Software Products Engineering Services | 22468.8 | 25788 | 27907 | 33500 | 33500 | 10.32 |
| Total IT-ITeS | 114784.2 | 128940 | 140833 | 160800 | 173800 | 10.75 |
Source: NASSCOM SR-2018, E: Estimated
Figure 4: Domestic Revenue of various segments in IT/ITeS Sector
Source: NASSCOM SR-2018, E: Estimated
