Can electric cars electrify muted IT firms in a dull year?

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Mint spoke with said the contribution of automotive firms to revenue from manufacturing or engineering, research and development (ER&D) services of IT companies is now 25-35% compared to 15-20% four years ago. (IT companies do not divulge automotive numbers separately, apart from clubbing them under manufacturing or ER&D heads.) Automotive clients comprise at least 10% of the global ER&D market, which is worth $1.8 trillion, said Kumar Rakesh, India analyst for IT and automotive sectors at financial services firm, BNP Paribas.

Of course, banks, including JP Morgan Chase & Co, Citi and Lloyds Bank, which have been Indian IT’s biggest clients for over a quarter of a century, continue to bring in the biggest chunk of revenues. All three analysts agreed that Infosys Ltd leads the pack, with automotive clients contributing an estimated 35% of its manufacturing revenue in recent times.

HCL Technologies Ltd and Tata Consultancy Services Ltd (TCS) are estimated to each draw 30% of their ER&D and manufacturing revenue from auto firms. A look at data shows the pace of growth of manufacturing and ER&D business is much higher compared to overall revenue growth for Infosys and HCL, albeit not for TCS.

Infosys's revenue from manufacturing more than doubled from $322 million in the fourth quarter of FY20 to $670 million in the latest January-March period. Comparatively, its annual consolidated revenue grew 45% to $18.56 billion in these four years.

Also in this period, manufacturing’s share of overall revenue rose from 10.1% to 14.7% for the Bengaluru-headquartered company, while that of banking shrank from 31.3% to 26.4%. HCL Technologies, which drew over 16% of its net revenue from ER&D services in Q3FY24 (the share has remained