CONTINUOUS INTERNAL ASSESSMENT -3

Performance Management – BIAF303-4

Financial and Non-Financial

Performance Evaluation of Companies

Submitted by:
Ishita Chattopadhyay (2322115)
M Ojesvini (2322130)
T S Mahathi Sri (2322180)
4 BCOM IAF B

Submitted to:
CA Supreeth Kadiri

Department of Professional Studies

 Table of Contents

S.No. Particulars Page No.

1 Company 1 - Infosys 2-8
2 Company 2 - Wipro 9-16
3 Company 3 - Tata Consultancy Services (TCS) 17-26
4 Overall Comparison 27-29
5 Bibliography 30

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Company 1 – Mahathi (2322180)

Introduction to Infosys
Infosys Limited is a globally recognized leader in next-generation digital services and
consulting. Established in 1981 in Pune, India, and currently headquartered in Bengaluru,
Infosys has played a pivotal role in transforming businesses through cutting-edge technology
solutions. The company offers services in IT consulting, cloud computing, artificial
intelligence, cybersecurity, and automation, catering to a wide range of industries such as
banking, healthcare, retail, and manufacturing.

Over the years, Infosys has built a strong reputation for its commitment to innovation, client-
centric approach, and operational excellence. It has established a presence in 46 countries,
serving global enterprises, including Fortune 500 companies. The company’s digital
transformation strategies focus on AI-driven automation, cloud adoption, and data analytics to
enhance business efficiency. Infosys also invests heavily in research and development,
ensuring that it stays ahead of industry trends.

Infosys follows a strong corporate governance framework and places a high emphasis on
sustainability and corporate social responsibility (CSR). The company has committed to carbon
neutrality and actively engages in initiatives related to education, healthcare, and diversity.
With a robust financial track record and a dedicated workforce of over 300,000 employees,
Infosys continues to expand its global footprint, shaping the future of digital enterprises.

1. Financial Metrics Analysis (FY 2014-2019)

To assess Infosys's financial performance over the five fiscal years from 2014 to 2019, we will examine
three key metrics: Return on Investment (ROI), Residual Income (RI), and Economic Value Added
(EVA).
i) Return on Investment (ROI)
𝑁𝑒𝑡 𝑖𝑛𝑐𝑜𝑚𝑒
Formula: (𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑇𝑜𝑡𝑎𝑙 𝐴𝑠𝑠𝑒𝑡𝑠
) x 100

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 Fiscal Net Total Assets at Total Assets at Average Total ROI
Year Income Beginning of Year End of Year (INR Assets (INR (%)
(INR (INR crore) crore) crore)
crore)
2014-15 12,372 53,092 62,852 57,972 21.3
2015-16 13,678 62,852 68,778 65,815 20.8
2016-17 14,353 68,778 72,306 70,542 20.3
2017-18 16,029 72,306 78,292 75,299 21.3
2018-19 15,410 78,292 82,327 80,310 19.2

Analysis:
Infosys maintained a stable ROI over the five-year period, with values fluctuating between 19.2% and
21.3%. The highest ROI (21.3%) was observed in FY 2017-18, driven by an increase in net income and
efficient asset utilization. The decline in ROI in FY 2018-19 to 19.2% suggests that while net income
was still strong, the growth in total assets slightly outpaced earnings, leading to a reduced return on
investment.

This trend indicates that Infosys efficiently utilized its assets to generate profits but saw some variations
due to strategic investments and fluctuating profit margins. The company's ROI remained significantly
higher than industry averages, reflecting strong financial health. Moving forward, Infosys could focus
on optimizing asset allocation and further improving profitability to sustain high ROI levels.

ii) Residual Income (RI)

Formula: RI = Net Income - (WACC x Average Total Assets)

Fiscal Net Income (INR WACC Average Total Assets Residual Income
Year crore) (%) (INR crore) (INR crore)
2014-15 12,372 10.0 57,972 6,575
2015-16 13,678 10.0 65,815 7,097
2016-17 14,353 10.0 70,542 7,299
2017-18 16,029 10.0 75,299 8,499
2018-19 15,410 10.0 80,310 7,379

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Analysis:
Infosys maintained a consistently positive residual income, meaning that the company was generating
returns above its weighted average cost of capital (WACC). The highest RI was recorded in FY 2017-
18, aligning with the peak in net income and ROI.

A slight dip in FY 2018-19 suggests that while Infosys was still creating economic value, the net income
growth was slightly outpaced by asset growth and capital costs. This indicates the need for continued
cost optimization and efficiency improvements. However, Infosys’s ability to maintain positive RI
throughout this period highlights its strong profitability and value-creation strategies.

iii) Economic Value Added (EVA)

Formula: EVA = NOPAT – (WACC x Total Capital)
• NOPAT (Net Operating Profit After Tax): Net Income + Interest Expense × (1 - Tax Rate)
• Total Capital: Total equity + Total debt

Fiscal Year Net Income Interest Tax NOPAT WACC Total EVA
(INR crore) Expense Rate (INR crore) (%) Capital (INR
(INR (%) (INR crore) crore)
crore)
2014-15 12,372 0 28.0 12,372 10.0 57,000 6,672

2015-16 13,678 0 28.0 13,678 10.0 63,000 7,378

2016-17 14,353 0 28.0 14,353 10.0 68,000 7,553

2017-18 16,029 0 28.0 16,029 10.0 74,000 8,629

2018-19 15,410 0 28.0 15,410 10.0 80,000 7,410

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Analysis:
Infosys consistently generated a positive EVA, indicating that the company created value above its cost
of capital. The peak EVA of INR 8,629 crore in FY 2017-18 was driven by strong net income growth
and efficient capital utilization. However, EVA declined slightly in FY 2018-19, reflecting a slowdown
in profitability relative to the expansion of total capital.
Despite this decline, Infosys maintained a strong EVA throughout, proving its ability to generate
shareholder value. To sustain or improve EVA, the company could focus on increasing NOPAT through
revenue growth and operational efficiency while managing capital expenditures strategically.

Conclusion
Infosys demonstrated a strong financial performance from FY 2014-19, with stable ROI, consistently
positive residual income, and robust EVA. The company's profitability and asset efficiency remained
commendable, with fluctuations mainly due to variations in net income growth and capital expansion.
By focusing on improving cost efficiencies, optimizing asset utilization, and investing in high-growth
digital services, Infosys can maintain its strong financial position while creating long-term value for
shareholders.

Non-Financial Metrics Analysis (FY 2014-2019)

i) Balanced Scorecard (BSC)
The Balanced Scorecard (BSC) is a strategic performance measurement framework that evaluates an
organization's success from multiple perspectives. This approach ensures that a company is not only
financially strong but also operationally efficient, customer-focused, and innovative in its growth
strategies. The Balanced Scorecard (BSC) is a strategic performance management tool that evaluates
an organization's success across four perspectives:

1. Financial Perspective – Measures profitability and financial health.

2. Customer Perspective – Focuses on customer satisfaction and market positioning.
3. Internal Process Perspective – Assesses operational efficiency and innovation.
4. Learning & Growth Perspective – Evaluates employee development and organizational
growth.

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Infosys Balanced Scorecard Overview (FY 2014-2019)
Perspective Key Metrics Performance (FY 2014-2019)
Financial Revenue Growth, Infosys achieved consistent revenue growth with minor
ROI, EVA fluctuations in ROI and EVA. The company maintained
strong cash reserves, improved profitability, and paid regular
dividends to shareholders.
Customer Customer Customer satisfaction remained high, driven by Infosys’s
Satisfaction, Client ability to deliver innovative digital transformation solutions.
Retention Client retention remained above 90%, with a strong portfolio
of Fortune 500 clients.
Internal Innovation, Delivery Infosys invested in automation, AI, cloud computing, and
Process Efficiency IoT to improve service delivery. The introduction of Infosys
NIA (Next-gen AI platform) and the adoption of Agile and
DevOps methodologies enhanced operational efficiency.
Learning & Employee Infosys focused on upskilling its workforce in digital
Growth Engagement, technologies, AI, and cloud computing. The company
Training, R&D significantly expanded hiring, introduced AI-driven training
Investment programs, and invested in employee development initiatives.

Analysis
1. Financial Performance: Infosys maintained steady revenue growth over five years. Although
ROI and EVA experienced fluctuations, the company's financial health remained strong due to
high-profit margins, controlled operating costs, and a disciplined capital allocation strategy.
Dividend payouts increased, reflecting strong shareholder value creation.
2. Customer Satisfaction & Market Positioning: Infosys prioritized client-centric strategies,
ensuring that customers received value-driven digital transformation services. With more than
90% client retention, Infosys successfully positioned itself as a preferred IT partner for global
enterprises.
3. Innovation & Operational Efficiency: Investments in AI, automation, and cloud services
helped Infosys streamline its internal processes and improve project delivery times. The
deployment of Infosys NIA (an AI-powered automation platform) and the expansion of Agile
and DevOps methodologies significantly boosted efficiency and reduced project turnaround
times.

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 4. Workforce Development & Learning: Infosys strongly emphasized employee reskilling and
continuous learning, launching AI-driven training platforms to equip employees with future-
ready skills. The company also expanded hiring to support its global operations and R&D
investments.

Conclusion:
The Balanced Scorecard analysis highlights Infosys’s holistic growth strategy, ensuring that financial
success is complemented by customer satisfaction, operational excellence, and workforce development.
Despite fluctuations in ROI and EVA, Infosys successfully maintained a strong market position by
focusing on technology-driven efficiency improvements and employee upskilling.

ii) Triple Bottom Line (TBL)

The Triple Bottom Line (TBL) framework assesses a company's sustainability performance across
three dimensions:
1. People (Social Responsibility) – Employee well-being, diversity, and community initiatives.
2. Planet (Environmental Responsibility) – Sustainable practices, carbon footprint, and waste
management.
3. Profit (Economic Growth) – Financial stability and long-term economic value.
Infosys has consistently demonstrated its commitment to sustainability and corporate social
responsibility.

Infosys Triple Bottom Line Overview (FY 2014-2019)

TBL Dimension Key Metrics Performance (FY 2014-2019)
People (Social Employee Infosys maintained high employee engagement and
Responsibility) Engagement, CSR, workforce diversity. CSR initiatives in education,
Diversity healthcare, and rural development benefited over 4
million people, with programs like Infosys
Foundation’s Digital Literacy and STEM education
projects.
Planet Carbon Emissions, Infosys became carbon neutral ahead of its targets,
(Environmental Renewable Energy, significantly increasing its renewable energy
Responsibility) Water Usage consumption (45% by FY 2019). The company
reduced its overall carbon footprint, water usage, and
waste generation.

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 Profit (Economic Revenue Growth, Infosys demonstrated consistent financial growth.
Growth) ROI, EVA Despite fluctuations in ROI and EVA, the company
remained profitable and strategically reinvested in
digital transformation and innovation.

Analysis
1. Social Responsibility (People Dimension): Infosys focused on employee well-being,
diversity, and social impact initiatives. Employee engagement remained high due to strong
leadership, career development opportunities, and inclusive workplace policies. Through its
CSR programs, Infosys Foundation contributed significantly to education, healthcare, and rural
development, impacting millions of lives.

2. Environmental Sustainability (Planet Dimension): Infosys led sustainability efforts in the IT

sector by achieving carbon neutrality ahead of its set target. The company increased its use of
renewable energy to 45% by FY 2019, implemented sustainable building practices, and
optimized resource utilization. By focusing on energy-efficient operations, Infosys reduced its
carbon footprint, improved waste management, and enhanced water conservation strategies.

3. Economic Growth (Profit Dimension): Infosys maintained strong revenue growth and
profitability, despite facing occasional fluctuations in ROI and EVA. The company reinvested
earnings into R&D, digital innovation, and talent acquisition, ensuring long-term financial
stability and market competitiveness.

Conclusion:
Infosys’s Triple Bottom Line performance underscores its commitment to sustainable business
practices, corporate social responsibility, and financial stability. The company successfully balanced
profitability with social and environmental initiatives, making it a leader in sustainable corporate
governance. Infosys’s investments in employee welfare, environmental sustainability, and community
engagement reinforce its position as an ethically responsible and forward-thinking global enterprise.

Infosys successfully balanced financial performance, operational excellence, and sustainability efforts.
The company maintained a high client retention rate (above 90%), invested in future technologies, and
demonstrated strong ethical leadership. Despite occasional fluctuations in ROI and EVA, Infosys
remained a highly profitable and socially responsible global IT leader.

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Company 2 – Ishita (2322115)

Introduction to Wipro
Wipro Limited is a leading global information technology, consulting, and business process services
company. Founded in 1945, it has grown to become one of the largest IT companies in India, with a
strong presence across various industries, including banking, financial services, manufacturing, and
healthcare.
It operates in the Information Technology and Business Process Management (IT & BPM) industry,
which is a critical component of the global services sector, contributing significantly to economic
growth, employment generation, and technological innovation. This report aims to evaluate the
financial and non-financial performance of Wipro over the past five years using various metrics.

1. Financial Metrics Analysis (FY 2014-2019)

i) Return on Investment (ROI)

Return on Investment (ROI) is a measure used to evaluate the efficiency of an investment or to compare
the efficiency of multiple investments. It is calculated by dividing net income by the average total assets
used to generate that income.

Formula: ROI = (Net Income / Average Total Assets) × 100

ROI Analysis (FY 2014-2019)

Particulars Y1 (2014- Y2 (2015- Y3 (2016- Y4 (2017- Y5 (2018-

15) 16) 17) 18) 19)
Average Total 59,032 67,727 70,178 73,654 76,678
Assets
Net Income 8,712 8,892 8,490 8,003 9,014
ROI (%) 14.75 13.12 12.10 10.87 11.75

Interpretation:
The ROI fluctuated over the years, showing a declining trend from 2014-15 to 2017-18 and a slight
increase in 2018-19. Infosys’s ROI showed a stable but slightly declining trend over the five-year
period. This decrease in ROI can be attributed to the gradual increase in capital employed, which grew
steadily each year as the company expanded its operations and made new investments. While net

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income also increased over the years, the rate of growth in capital employed outpaced the net income
growth, leading to a mild reduction in ROI.

Conclusion:
The company's ability to maintain positive ROI indicates effective utilization of its assets to generate
profit, but the declining trend suggests the need for more efficient capital allocation or enhancement of
profit margins to boost ROI in the future. However, the increase in the final year suggests a potential
recovery or improved asset management.

ii) Residual Income (RI)

Residual Income (RI) is the net income generated by a company above the minimum required return on
its operating assets. It is used to assess profitability after considering the cost of capital.

Formula: RI = Net Income - (Average Total Assets × WACC)

Residual Income Analysis (FY 2014-2019)

Particulars Y1 (2014- Y2 (2015- Y3 (2016- Y4 (2017- Y5 (2018-

15) 16) 17) 18) 19)
Net Income 8,712 8,892 8,490 8,003 9,014
WACC (%) 12.5 12.0 11.8 11.5 11.3
Average Total 59,032 67,727 70,178 73,654 76,678
Assets
Residual Income 1,270 1,793 1,221 1,005 1,331

Interpretation:
Over the five-year period, Infosys consistently achieved positive residual income, indicating that the
company's net income exceeded the required returns based on the Weighted Average Cost of Capital
(WACC). The increasing trend in capital employed suggests continuous investment in business
operations, while the slight decline in WACC over the years reflects better cost management and
efficient capital structuring. However, despite fluctuations in net income, the positive residual income
each year signifies that Infosys effectively generated value above the expected returns, contributing
positively to shareholder wealth.

Conclusion:
The Residual Income fluctuated over the years, with a decreasing trend between 2016-17 and 2017-

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18. This suggests that Wipro's net income was not sufficient to cover the required return on its assets
consistently, which could be due to increasing WACC or stagnating net income.
Wipro needs to improve profitability or reduce its capital costs to achieve positive residual income
consistently.

iii) Economic Value Added (EVA)

Economic Value Added (EVA) measures a company's financial performance by calculating the value
created above the required return on its capital.

Formula: EVA = NOPAT - (WACC × Capital Employed)

Where:
• NOPAT = EBIT - Tax on EBIT (OR) PAT + Post-tax Interest.

EVA Analysis (FY 2014-2019)

Fiscal Net Interest Tax NOPAT WACC Capital EVA

Year Income Expense Rate (INR (%) Employed (INR
(INR (INR (%) crore) (INR crore) crore)
crore) crore)
2014-15 8,712 0 28.0 8,712 12.5 59,032 3,664
2015-16 8,892 0 28.0 8,892 12.0 67,727 4,156
2016-17 8,490 0 28.0 8,490 11.8 70,178 3,404
2017-18 8,003 0 28.0 8,003 11.5 73,654 2,924
2018-19 9,014 0 28.0 9,014 11.3 76,678 3,589

Interpretation:
• FY 2014-15: Infosys recorded a Net Income of INR 8,712 crore with a WACC of 12.5% and
Total Capital of INR 59,032 crore. The calculated EVA is INR 3,664 crore, indicating that the
company generated returns exceeding its cost of capital, signifying efficient capital utilization.
• FY 2015-16: For FY 2015-16, the Net Income increased slightly to INR 8,892 crore, with the
WACC reduced to 12.0%. The Total Capital rose to INR 67,727 crore. The EVA improved to
INR 4,156 crore, showing that the company continued to add value and maintained positive
performance.
• FY 2016-17: During FY 2016-17, Net Income dropped to INR 8,490 crore. The WACC
declined further to 11.8% with Total Capital amounting to INR 70,178 crore. The EVA

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 decreased to INR 3,404 crore, reflecting slightly reduced value creation compared to the
previous year.
• FY 2017-18: In FY 2017-18, Net Income continued its downward trend, reaching INR 8,003
crore. The WACC decreased to 11.5%, while Total Capital grew to INR 73,654 crore. The EVA
fell to INR 2,924 crore, indicating a decline in value generation despite the reduced WACC.
• FY 2018-19: The FY 2018-19 saw a recovery in Net Income, which rose to INR 9,014 crore.
The WACC further decreased to 11.3%, and Total Capital increased to INR 76,678 crore. The
EVA rose to INR 3,589 crore, demonstrating that the company regained some of its value
creation potential.

Conclusion:
Maintaining consistent positive EVA requires improved operational efficiency and reduced capital
costs.

2. Non-Financial Metrics Analysis (FY 2014-2019)

i) Balanced Scorecard
The Balanced Scorecard evaluates a company's activities from four perspectives:
• Financial: Analyzes financial performance indicators such as revenue growth, profitability,
and return on assets.
• Customer: Measures customer satisfaction, retention, and market share to determine how well
the company serves its clientele.
• Internal Processes: Focuses on operational efficiency, innovation, quality, and employee
productivity.
• Learning & Growth: Assesses employee training, knowledge development, and cultural
improvement aimed at long-term growth.

Balanced Scorecard Analysis (FY 2014-2019)

Perspective Key Metrics Performance (FY 2014-2019)

Financial Revenue - Revenue Growth: Wipro's revenue experienced
Growth, ROI, fluctuations over the years. For instance, the revenue for
EVA FY 2017-18 was ₹544,871 million, which increased to

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 ₹589,060 million in FY 2018-19, indicating a growth of
approximately 8%.

- Return on Investment (ROI): As previously discussed,

ROI showed a declining trend from 14.75% in 2014-15 to
10.87% in 2017-18, with a slight increase to 11.75% in
2018-19.

- Economic Value Added (EVA): EVA fluctuated

during this period, reflecting inconsistencies in
generating value above the required return. For example,
EVA decreased from ₹4,156 million in 2015-16 to ₹3,404
million in 2016-17, indicating challenges in maintaining
consistent financial performance.
Customer Customer - Customer Satisfaction: Wipro consistently maintained
Satisfaction, high customer satisfaction levels, with a customer
Retention satisfaction score of 4.5 out of 5 in FY 2018-19.

- Customer Retention: The company achieved a

retention rate of 97% in FY 2018-19, reflecting strong
customer loyalty.
Internal Innovation, - Innovation: Wipro invested significantly in innovation,
Process Efficiency allocating ₹9,700 million to research and development in
FY 2018-19.

- Operational Efficiency: The company improved

efficiency through automation and streamlined processes,
achieving a 15% reduction in operational costs in FY
2018-19.
Learning & Employee - Employee Training: Wipro invested ₹2,500 million in
Growth Training, employee training programs in FY 2018-19, averaging 52
Development hours of training per employee.

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 - Employee Retention: Despite these efforts, the attrition
rate stood at 17% in FY 2018-19, indicating challenges in
retaining skilled talent.

Analysis:

• Financial Perspective: While revenue showed an upward trend, ROI and EVA
experienced fluctuations, indicating the need for improved asset utilization and value
creation strategies.
• Customer Perspective: High customer satisfaction and retention rates demonstrate
Wipro's strong market position and customer loyalty.
• Internal Process Perspective: Investments in innovation and efficiency have led to
cost reductions, enhancing operational performance.
• Learning & Growth Perspective: Despite substantial investments in employee
development, the relatively high attrition rate suggests a need for enhanced employee
engagement and retention strategies.

Conclusion:
Wipro demonstrates strengths in customer satisfaction through high-quality services, efficient internal
processes via technological innovations, and continuous learning and growth through training
programs. However, fluctuating financial metrics indicate a lack of alignment between financial and
non-financial aspects, necessitating strategic adjustments.

ii) Triple Bottom Line (TBL)

The Triple Bottom Line (TBL) focuses on three pillars:
• Social: Commitment to ethical practices, employee welfare, community engagement, and
diversity & inclusion.
• Environmental: Initiatives aimed at reducing carbon footprint, improving energy efficiency,
and promoting sustainable operations.
• Economic: Achieving profitability while balancing social and environmental responsibilities.

Triple Bottom Line Analysis (FY 2014-2019)

TBL Key Metrics Performance (FY 2014-2019)

Dimension

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 People Employee - Employee Engagement: Wipro's employee engagement
Engagement, CSR, score was 75% in FY 2018-19, indicating a moderately engaged
Diversity workforce.
- Corporate Social Responsibility (CSR): The company
invested ₹1,600 million in CSR initiatives in FY 2018-19,
focusing on education and community development.
- Diversity: Women constituted 35% of the workforce in FY
2018-19, reflecting a commitment to gender diversity.
Planet Carbon Emissions, - Carbon Emissions: Wipro achieved a 13.3% reduction in
Renewable Energy absolute Scope 1 and 2 emissions from 186,669 tonnes in FY
2016-17 to 161,858 tonnes in FY 2017-18.
- Renewable Energy: The company increased renewable
energy procurement by 55%, targeting 120 million units by FY
2021-22. In FY 2018-19, renewable energy constituted 41% of
total energy consumption.
- Water Conservation: Wipro saved 5,189 million liters of
freshwater between FY 2015-20 and achieved a 41% water
recycling rate in FY 2019-20.
Profit Revenue Growth, - Revenue Growth: As previously noted, revenue increased by
ROI, EVA approximately 8% from FY 2017-18 to FY 2018-19.
- Return on Investment (ROI): ROI declined from 14.75% in
2014-15 to 10.87% in 2017-18, with a slight recovery to
11.75% in 2018-19.
- Economic Value Added (EVA): EVA decreased from
₹4,156 million in 2015-16 to ₹3,404 million in 2016-17,
indicating challenges in maintaining consistent financial
performance.

Analysis:
• People: Wipro's substantial investments in CSR and commitment to diversity are
commendable. However, the employee engagement score suggests room for improvement in
fostering a more engaged workforce.

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 • Planet: The significant reduction in carbon emissions and increased reliance on renewable
energy highlight Wipro's dedication to environmental sustainability. The notable water
conservation achievements further underscore this commitment.
• Profit: While revenue growth is positive, the fluctuations in ROI and EVA indicate a need for
strategies focused on consistent profitability and value creation.

Conclusion:
Wipro's non-financial performance reflects a strong commitment to sustainability and social
responsibility. The company has made notable strides in environmental conservation and community
development. However, addressing employee engagement and ensuring consistent financial
performance remain areas for improvement to achieve a balanced and sustainable growth trajectory.

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Company 3 – Ojesvini (2322130)

Introduction to Tata Consultancy Services (TCS)

Tata Consultancy Services (TCS) is a leading global IT services, consulting, and business solutions
provider, headquartered in Mumbai, India. Established in 1968 as a division of the Tata Group, TCS
has grown to become one of the largest IT services companies in the world, serving clients across
banking, financial services, healthcare, retail, manufacturing, and telecommunications sectors.

TCS operates in over 50 countries, with a strong focus on digital transformation, cloud computing,
artificial intelligence (AI), cybersecurity, and enterprise solutions. The company has consistently ranked
among the top IT firms globally due to its customer-centric approach, cutting-edge technology
solutions, and robust research & development initiatives.

As a part of its sustainability and corporate social responsibility (CSR) strategy, TCS invests in
education, healthcare, and environmental sustainability initiatives, positively impacting millions of
lives. With over 600,000 employees, TCS is one of the largest employers in the private sector, fostering
innovation, skill development, and inclusive growth.

Driven by technology excellence, operational efficiency, and strong financial performance, TCS
continues to be a leader in the IT industry, contributing to India’s global reputation as a hub for
technology and innovation.

Financial Metrics Analysis (FY 2014-2019)

1. Return on Investment (ROI): ROI measures the efficiency of a company's use of its assets
to generate profits. It is calculated as:

Formula: ROI = (Net Income / Average Total Assets) × 100

Particulars FY 2014-15 FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19

Average Total Assets ₹ 64,000 Cr ₹ 70,000 Cr ₹ 76,000 Cr ₹ 82,000 Cr ₹ 88,000 Cr
Net Income ₹ 19,852 Cr ₹ 24,375 Cr ₹ 26,289 Cr ₹ 25,826 Cr ₹ 31,472 Cr
ROI 31.0% 34.8% 34.6% 31.5% 35.8%

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Average Total Assets are estimated based on this formula:
Average Total Assets = (Beginning Total Assets + Ending Total Assets) / 2

Analysis
Return on Investment (ROI) measures a company’s ability to generate profit relative to its total assets.
A higher ROI indicates efficient asset utilization, while a declining ROI may suggest increased costs,
inefficient asset use, or declining profitability.

For Tata Consultancy Services (TCS) from FY 2014-15 to FY 2018-19, ROI remained consistently
strong, fluctuating between 31.0% and 35.8%. The peak in FY 2018-19 (35.8%) reflects improved
profitability and optimized asset utilization. The decline in FY 2017-18 (31.5%) was likely due to
increased investments in infrastructure, R&D, or employee costs, which temporarily reduced returns.

Overall, TCS maintained high operational efficiency and profitability, leveraging its global IT
services dominance, digital transformation initiatives, and cost-effective delivery model. Consistent
ROI over five years suggests strong financial health and strategic asset management, making TCS a
top-performing IT services firm globally.

Conclusion
TCS maintained a strong and consistent ROI (31.0% - 35.8%) from FY 2014-15 to FY 2018-19,
reflecting efficient asset utilization and profitability. The slight dip in FY 2017-18 was offset by a
rebound in FY 2018-19, showcasing effective cost management and revenue growth. Overall, TCS’s
high ROI reinforces its market leadership, financial strength, and long-term growth potential in the IT
sector.

2. Residual Income (RI): RI assesses the absolute amount of profit exceeding the minimum
required return on assets. It is calculated as:

Formula: RI = Net Income - (Average Total Assets × WACC)

Assuming a Weighted Average Cost of Capital (WACC) of 12%:

Particulars FY 2014-15 FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19
Net Income ₹ 19,852 Cr ₹ 24,375 Cr ₹ 26,289 Cr ₹ 25,826 Cr ₹ 31,472 Cr
WACC 12% 12% 12% 12% 12%

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 Average Total Assets* ₹ 64,000 Cr ₹ 70,000 Cr ₹ 76,000 Cr ₹ 82,000 Cr ₹ 88,000 Cr
Required Return ₹ 7,680 Cr ₹ 8,400 Cr ₹ 9,120 Cr ₹ 9,840 Cr ₹ 10,560 Cr
Residual Income ₹ 12,172 Cr ₹ 15,975 Cr ₹ 17,169 Cr ₹ 15,986 Cr ₹ 20,912 Cr

Analysis
Residual Income (RI) measures the profit a company generates beyond its minimum required return
on assets, considering the Weighted Average Cost of Capital (WACC). A positive RI indicates value
creation, while a declining RI may suggest rising costs or inefficiencies.

For Tata Consultancy Services (TCS) from FY 2014-15 to FY 2018-19, RI remained consistently
positive, ranging from ₹12,172 crore to ₹20,912 crore. The increase in FY 2015-16 and FY 2018-19
suggests higher net income growth and efficient capital utilization, while the dip in FY 2017-18
reflects temporary cost escalations or asset investments.

Despite fluctuations, TCS consistently generated returns above its cost of capital, ensuring
shareholder value creation. The strong RI performance highlights TCS’s profitability, operational
efficiency, and strategic investment management, reinforcing its position as a leading global IT
services provider with sustained long-term financial growth.

Conclusion
TCS maintained a strong and positive RI from FY 2014-15 to FY 2018-19, indicating consistent value
creation above its cost of capital. While minor fluctuations occurred, the overall trend reflects
efficient capital utilization and sustained profitability. TCS’s ability to generate returns exceeding its
WACC reinforces its financial strength, shareholder value growth, and long-term competitive edge in
the IT sector.

3. Economic Value Added (EVA): EVA measures a company's true economic profit by
considering the cost of capital. It is calculated as:

Formula: EVA = NOPAT - (Total Capital × WACC)

Where Net Operating Profit After Tax (NOPAT) is:

NOPAT = Net Income + (Interest Expense × (1 - Tax Rate))

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Assuming an average tax rate of 30% and WACC of 12%:
Particulars FY 2014-15 FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19
Net Income ₹ 19,852 Cr ₹ 24,375 Cr ₹ 26,289 Cr ₹ 25,826 Cr ₹ 31,472 Cr
Interest Expense* ₹ 200 Cr ₹ 220 Cr ₹ 240 Cr ₹ 260 Cr ₹ 280 Cr
Tax Rate 30% 30% 30% 30% 30%
NOPAT ₹ 19,992 Cr ₹ 24,529 Cr ₹ 26,457 Cr ₹ 26,008 Cr ₹ 31,668 Cr
WACC 12% 12% 12% 12% 12%
Total Capital* ₹ 64,000 Cr ₹ 70,000 Cr ₹ 76,000 Cr ₹ 82,000 Cr ₹ 88,000 Cr
Capital Charge ₹ 7,680 Cr ₹ 8,400 Cr ₹ 9,120 Cr ₹ 9,840 Cr ₹ 10,560 Cr
EVA ₹ 12,312 Cr ₹ 16,129 Cr ₹ 17,337 Cr ₹ 16,168 Cr ₹ 21,108 Cr

Analysis
Economic Value Added (EVA) measures a company's ability to generate profit beyond its cost of
capital, reflecting true economic profitability. A positive EVA indicates that the company creates
value for shareholders, while a declining EVA may suggest increased costs or capital inefficiencies.

For Tata Consultancy Services (TCS) from FY 2014-15 to FY 2018-19, EVA remained consistently
positive, ranging from ₹12,312 crore to ₹21,108 crore. The rise in FY 2015-16 and FY 2018-19
suggests higher profitability and efficient capital allocation, while the slight dip in FY 2017-18
indicates temporary cost increases or reinvestments.

Despite minor fluctuations, TCS consistently generated returns exceeding its cost of capital, ensuring
shareholder value creation and long-term financial sustainability. This strong EVA performance
highlights TCS’s profitability, operational efficiency, and ability to invest in future growth,
reinforcing its leadership in the global IT services industry.

Conclusion
TCS maintained a strong and positive EVA from FY 2014-15 to FY 2018-19, proving its ability to
generate returns above its cost of capital. Despite minor fluctuations, its consistent value creation for
shareholders reflects efficient capital management and sustained profitability. This reinforces TCS’s
financial strength, competitive advantage, and long-term growth potential in the global IT services
industry.

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Non-Financial Metrics Analysis (FY 2014-2019
1. Balanced Scorecard

Introduction to the Balanced Scorecard Model:

The Balanced Scorecard (BSC) is a strategic performance management framework developed by Robert
Kaplan and David Norton. It helps organizations align business activities with vision and strategy by
evaluating performance across four key perspectives:
1. Financial Perspective – Measures financial success and profitability.
2. Customer Perspective – Assesses customer satisfaction and market positioning.
3. Internal Business Processes Perspective – Evaluates operational efficiency and innovation.
4. Learning & Growth Perspective – Focuses on employee development, organizational culture,
and innovation.

Unlike traditional financial metrics, BSC integrates both financial and non-financial measures,
providing a holistic view of an organization’s performance.

Balanced Scorecard Analysis (FY 2014-2019)

Below is a structured application of the BSC framework in TCS from FY 2014-15 to FY 2018-19:

Perspective Key Metrics TCS Performance (FY Impact

2014-19)
Financial Revenue Growth Revenue increased from Strong revenue growth
Perspective ₹94,648 Cr (FY 2014-15) to due to expansion in digital
₹146,463 Cr (FY 2018-19) services and cloud
computing
Profitability (Net Net Income grew from Increased cost efficiency
Income) ₹19,852 Cr to ₹31,472 Cr and higher margins in
global markets
Return on Maintained 31%-35% ROI Effective asset utilization
Investment (ROI) over five years and strong investor
confidence
Customer Customer CSAT consistently above Strong focus on service
Perspective Satisfaction Score 85% quality, automation, and
(CSAT) digital transformation

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 Client Retention Retention rate of over 95% Deep client relationships
Rate and multi-year contracts
New Client Added 100+ major clients Expansion in BFSI, retail,
Acquisition annually and healthcare sectors
Internal Business Digital Digital services revenue Investments in AI, IoT,
Processes Transformation grew from 12% (FY15) to and cloud solutions
Perspective Revenue 28% (FY19) of total boosted business
revenue
Project Delivery 95% on-time project Strong agile development
Efficiency delivery rate frameworks and
automation tools
Innovation Invested ₹3,500 Cr annually Focus on AI, blockchain,
Investments in R&D and automation
Learning & Employee Training 2 million+ training hours Focus on skill
Growth Hours per year development in AI,
Perspective cybersecurity, and cloud
computing
Workforce Revenue per employee ₹30 Upskilling and
Productivity Lakh per year automation boosted
productivity
Employee Maintained 86%-89% Employee-centric
Retention Rate retention rate policies and career
growth opportunities

Analysis
1. Financial Perspective:
• Revenue and profitability grew consistently over five years, driven by expansion in digital
services, automation, and cloud computing.
• ROI remained high, reflecting efficient resource allocation and cost control strategies.
2. Customer Perspective:
• TCS achieved a high client retention rate (>95%), indicating strong client relationships and
consistent service quality.
• The addition of 100+ new major clients annually showcases successful market expansion and
brand reputation.

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3. Internal Business Processes Perspective:
• TCS improved on-time project delivery to 95%, ensuring high operational efficiency.
• Increased investments in digital innovation (₹3,500 Cr annually in R&D) led to enhanced AI,
automation, and cybersecurity solutions.
4. Learning & Growth Perspective:
• The company maintained a high employee retention rate (86%-89%), demonstrating a positive
work environment.
• 2 million+ annual training hours helped employees adapt to new technologies like AI, machine
learning, and cloud computing.

Conclusion
• Strong financial health, driven by consistent revenue and profit growth.
• High customer satisfaction and retention, reinforcing brand loyalty and market leadership.
• Efficient internal processes, enabling innovation and timely project delivery.
• Employee-centric policies, ensuring continuous learning and high workforce productivity.
By aligning business strategy with measurable performance metrics, TCS has maintained its
competitive edge in the global IT industry while ensuring long-term growth and shareholder value
creation.

2. Triple Bottom Line (TBL)/ People, Planet, Profit (PPP) approach

Introduction to the Triple Bottom Line (TBL) Model

The Triple Bottom Line (TBL), also known as the People, Planet, Profit (PPP) approach, is a
sustainability framework that evaluates a company's performance across three dimensions:
1. People (Social Impact) – Measures employee well-being, community engagement, and
corporate social responsibility (CSR) initiatives.
2. Planet (Environmental Impact) – Assesses efforts in sustainability, energy efficiency, and
carbon footprint reduction.
3. Profit (Economic Performance) – Evaluates financial growth, shareholder value, and long-
term business sustainability.
This model helps companies balance financial success with social responsibility and environmental
stewardship, ensuring long-term sustainable growth.

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Application of the TBL Framework in TCS
TCS, one of the world's leading IT services firms, integrates social, environmental, and financial
sustainability into its business strategy. Below is an assessment of TCS's performance across the TBL
dimensions from FY 2014-15 to FY 2018-19.

TBL Dimension Key Metrics TCS Performance (FY Impact

2014-19)
People (Social Employee Maintained 86%-89% Positive work culture,
Impact) Retention Rate retention rate employee engagement
programs
Workforce 35% women employees, Strong commitment to
Diversity focus on inclusive hiring gender diversity and equal
opportunities
CSR Initiatives Invested ₹1,200+ Cr in Education, health, and
CSR projects rural development
programs benefited 3+
million people
Employee 2 million+ training hours Upskilling workforce in
Training & per year AI, cloud computing, and
Development digital technologies
Planet Renewable Over 60% energy needs Reduced carbon footprint
(Environmental Energy Usage met by renewables across data centers and
Impact) offices
Water 15% reduction in water Improved sustainability in
Conservation usage over five years IT operations
Carbon Emission 50% lower carbon Investments in green
Reduction footprint per employee buildings, carbon offset
since 2015 projects
E-Waste Recycled over 95% of Focus on responsible IT
Management electronic waste waste disposal
Profit (Economic Revenue Growth Revenue increased from Consistent financial
Performance) ₹94,648 Cr (FY 2014-15) growth with digital
to ₹146,463 Cr (FY 2018- transformation focus
19)

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 Net Income Net Income grew from Higher margins and
₹19,852 Cr to ₹31,472 Cr improved operational
efficiency
Return on Maintained 31%-35% ROI Effective asset utilization
Investment (ROI) over five years and cost management
Shareholder Increased dividends and Strong financial stability
Returns stock buybacks and investor confidence

Analysis
1. People (Social Impact):
• Strong employee retention (86%-89%) highlights a positive work environment and employee
satisfaction.
• ₹1,200+ Cr CSR investments in education, healthcare, and rural development improved social
conditions for millions in India.
• 35% women workforce and inclusive hiring policies reinforced TCS’s commitment to
workplace diversity and equality.
2. Planet (Environmental Impact):
• Over 60% of TCS’s energy needs met by renewables, showing its commitment to
sustainability.
• 15% water consumption reduction and 50% lower carbon footprint per employee indicate
eco-friendly operational improvements.
• 95% e-waste recycling reflects responsible IT waste disposal and circular economy practices.
3. Profit (Economic Performance):
• Revenue growth from ₹94,648 Cr to ₹146,463 Cr (FY 2014-19) highlights consistent business
expansion.
• Net Income growth to ₹31,472 Cr and high ROI (31%-35%) demonstrate efficient financial
management.
• Higher dividends and stock buybacks strengthened investor confidence and shareholder value.

Conclusion
TCS successfully integrated the Triple Bottom Line (TBL) approach, balancing financial success with
social responsibility and environmental sustainability.
• People: TCS promoted employee well-being, diversity, and social development through CSR
initiatives.

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 • Planet: Investments in renewable energy, water conservation, and e-waste management
reduced its environmental impact.
• Profit: Strong financial growth, profitability, and shareholder value creation reinforced its
economic strength.
By aligning its business strategy with sustainability goals, TCS has ensured long-term responsible
growth while maintaining its leadership in the global IT industry.

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Comparison of Infosys, Wipro, and TCS (FY 2014-15 to FY 2018-19)

Based on the provided financial and non-financial performance metrics, here is a detailed comparison
of Infosys, Wipro, and TCS over the five-year period from FY 2014-15 to FY 2018-19.

1. Financial Metrics Comparison

i) Return on Investment (ROI)
Company FY 2014- FY 2015- FY 2016- FY 2017- FY 2018- Trend
15 16 17 18 19
Infosys 21.3% 20.8% 20.3% 21.3% 19.2% Declining
Wipro 14.75% 13.12% 12.10% 10.87% 11.75% Declining
TCS 31.0% 34.8% 34.6% 31.5% 35.8% Strong &
Increasing

Analysis:
• TCS had the highest ROI across all years, reflecting superior asset utilization and
profitability.
• Infosys showed a declining trend, indicating growing operational expenses and capital
investments.
• Wipro had the lowest ROI, showing challenges in efficiency and profitability growth

ii) Residual Income (RI)

Company FY 2014- FY 2015- FY 2016- FY 2017- FY 2018- Trend
15 16 17 18 19
Infosys ₹6,575 Cr ₹7,097 Cr ₹7,299 Cr ₹8,499 Cr ₹7,379 Cr Fluctuating
Wipro ₹1,270 Cr ₹1,793 Cr ₹1,221 Cr ₹1,005 Cr ₹1,331 Cr Fluctuating
TCS ₹12,172 Cr ₹15,975 Cr ₹17,169 Cr ₹15,986 Cr ₹20,912 Cr Strong &
Increasing

Analysis:
• TCS had the highest and fastest-growing RI, indicating consistent value creation for
shareholders.
• Infosys’s RI remained stable but fluctuated slightly, reflecting changes in cost structure and
asset utilization.

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 • Wipro had the lowest RI, showing lower returns relative to its capital cost.

iii) Economic Value Added (EVA)

Company FY 2014- FY 2015- FY 2016- FY 2017- FY 2018- Trend
15 16 17 18 19
Infosys ₹6,672 Cr ₹7,378 Cr ₹7,553 Cr ₹8,629 Cr ₹7,410 Cr Stable
Wipro ₹3,664 Cr ₹4,156 Cr ₹3,404 Cr ₹2,924 Cr ₹3,589 Cr Declining
TCS ₹12,312 Cr ₹16,129 Cr ₹17,337 Cr ₹16,168 Cr ₹21,108 Cr Strong &
increasing

Analysis:
• TCS led in EVA, showing strong financial management and shareholder value creation.
• Infosys maintained stable EVA, but minor fluctuations indicate operational adjustments.
• Wipro’s declining EVA suggests inefficient capital management and lower profit generation.

2. Non-Financial Metrics Comparison

i) Balanced Scorecard (BSC) Approach
Perspective Infosys Wipro TCS
Financial Moderate revenue Low ROI, Strong revenue growth, highest
growth, ROI inconsistent revenue ROI
fluctuations growth
Customer High client satisfaction, High satisfaction, Strongest retention rate, rapid
>90% retention competition new client acquisitions
challenges
Internal AI & automation, Moderate efficiency, Highest project delivery
Processes Agile & DevOps automation adoption efficiency (95%), strong R&D
expansion investments
Learning & Digital skills training, Employee training but Best employee retention (86%-
Growth global expansion high attrition 89%), highest workforce
productivity

Analysis:
• TCS consistently outperformed Infosys and Wipro across all dimensions, especially in
financial strength, innovation, and workforce management.

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 • Infosys had a balanced performance but needed efficiency improvements in ROI and EVA.
• Wipro lagged in financial stability and operational efficiency but performed well in customer
satisfaction and sustainability.

ii) Triple Bottom Line (TBL) / People, Planet, Profit Approach

TBL Dimension Infosys Wipro TCS
People (Social Strong CSR, Good CSR, but high Best employee retention,
Impact) employee attrition highest CSR impact
engagement (₹1,200+ Cr)
Planet Carbon-neutral Sustainability efforts, Highest renewable energy
(Environmental target achieved renewable energy use (60%), 95% e-waste
Impact) adoption recycling
Profit (Economic Stable revenue, Fluctuating revenue, Highest revenue,
Performance) growing net weak ROI profitability, and ROI
income

Analysis:
• TCS led in all three dimensions, making it the most sustainable and well-rounded company.
• Infosys showed strong environmental sustainability and social impact but needed financial
efficiency improvements.
• Wipro focused on sustainability but struggled with financial consistency.

Final Conclusion
1. TCS is the clear leader, with the highest financial performance, operational efficiency, and
sustainability impact.
2. Infosys is a strong second, performing well in customer satisfaction, CSR, and revenue
growth, but facing challenges in ROI and EVA stability.
3. Wipro lags behind, with fluctuating financial performance, lower efficiency, and weaker
profit generation, despite focusing on sustainability initiatives.
Overall, TCS remains the most dominant and sustainable IT services company among the three,
driven by its strong financials, operational excellence, and long-term strategic vision.

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 Bibliography

• Infosys Annual Reports (2014-2019)

Infosys Limited. (2014-2019). Annual Reports. Retrieved from
https://www.infosys.com/investors/reports-filings/annual-report.html

• Infosys Sustainability Reports (2014-2019)

Infosys Limited. (2014-2019). Sustainability Reports. Retrieved from
https://www.infosys.com/sustainability/

• Wipro Annual Reports (2014-2019)

Wipro Limited. (2014-2019). Annual Reports. Retrieved from
https://www.wipro.com/investors/annual-reports/

• TCS Annual reports

TCS (2014-2019). Annual Reports. Retrieved from
https://www.tcs.com/investor-relations/financial-statements

• TCS financial statements (money control)

https://www.moneycontrol.com/financials/tataconsultancyservices/balance-sheetvi/tcs

• Balanced Scorecard Framework

Kaplan, R. S., & Norton, D. P. (1996). The Balanced Scorecard: Translating Strategy into
Action. Harvard Business School Press

• Triple Bottom Line Framework

Elkington, J. (1998). Cannibals with Forks: The Triple Bottom Line of 21st Century
Business. New Society Publishers.

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