An analysis of deals bagged by Infosys, Wipro, TCS and HCL Technologies over the past seven quarters shows that the average deal size has almost tripled from $15 million in 2004 to nearly $50 million by end of last year.
In another sign that the majors are winning fatter contracts with increasing regularity, the number of clients has also gone up.
While Infosys has 14 clients above the $ 40 million mark each compared with seven last year, TCS now has 28 clients worth $ 20 million each as against 21 last year.
Infosys also has two clients above the $ 80 million each compared with just one last year. On the flip side, smaller companies are not benefitting from this upsurge.
In contrast, the average size of similar deals in Asia Pacific has shrunk by nearly half to $153 million from $293 million a year ago, according to consultancy firm TPI's latest report.
Wipro President (enterprise solutions) Sudip Banerjee said along with the increase in contract values, the duration of contracts had also gone up from about two years in 2004 to about three to five years currently.
This has also meant that the industry is raising its benchmarks as the appetite for business goes up.
"The deals in the pipeline and the four that were signed in the last six months have crossed $500 million. A year ago we were centered on deals worth $15-20 million," added Saurav Adhikari, corporate V-P (finance), HCL Technologies.
HCL Technologies, which recently signed a $300 million deal with DSG International, has moved from being a tier-2 company having deals worth $15 million to bagging contracts worth $80-100 million.
To top it all, all this has happened even after the recent pay hikes by the IT majors.
"This has happened in spite of the firming up of salaries of Indian IT professionals, which means Indian IT services companies no longer have cost arbitrage as their sole USP. Instead they have demonstrated their capabilities in terms of quality, timeliness, understanding of the clients' businesses and delivery," said Nirupam Chaudhuri, assistant manager (software & services) research, IDC.
Mohan Das Pai, chief financial officer, Infosys, said, "There has been a substantial increase in the project size in the last six quarters but the trend is restricted to just tier-1 companies as smaller companies cannot match the size."