Tata Group working on 100 Gen AI projects: Chandrasekaran

The Tata Group is working on 100 generative artificial intelligence (GenAI) projects that are having a meaningful impact on customer experience, productivity and efficiency across its retail and manufacturing businesses, according to the group's chief. 

Addressing shareholders at Tata Consultancy Services Ltd’s (TCS's) 29th annual general meeting (AGM) on Friday, Natarajan Chandrasekaran, chairman of Tata Sons Ltd, said GenAI will have a significant impact on every industry, but will also lead to uncertainty.

Chandrasekaran highlights use of GenAI in e-commerce, manufacturing

“In e-commerce, GenAI is being used to generate product catalogs, deliver conversational shopping experience and provide personalized offers,” said Chandrasekaran, who is also the chairman of TCS. 

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“In manufacturing, GenAI is enabling shopfloor workers to troubleshoot complex equipment by asking questions in their native languages, thereby improving productivity. Companies are utilizing GenAI to analyze large documents such as tender documents to significantly reduce the sales cycle,” said Chandrasekaran, who took over as as chairman of Tata Sons in February 2017.

Tata Sons is the holding company of the group, owning shares in over two dozen Tata Group firms, which had $150 billion in revenue at the end of March 2023. Under Tata Digital, the privately-held business, the group offers groceries and food.

GenAI, which includes technology-driving innovations like ChatGPT, spans a broad array of capabilities, including creating new content forms like text, audio, and video. The global attention on AI following the launch of ChatGPT in November 2022 has made companies call it both an opportunity and a risk factor because of its disruptive nature.

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Chandrasekaran’s commentary on Gen AI as part of his opening speech at TCS’s AGM mirrored the interest of shareholders: 20 of the 30 shareholders of the country’s largest technology services firm quizzed the management on the impact of GenAI on TCS at the nearly three-hour-long shareholder meeting.

TCS ended with $29.1 billion in revenue last year, with 4.1% dollar revenue growth. Operating margin improved 50 basis points to 24.6%. 

To a question on the company's growth in the current financial year, Chandrasekaran reiterated that the management intends to grow the company faster than last year. TCS does not give any guidance but CEO K. Krithivasan had said earlier that the current financial year will be better than last year.

For now, TCS is the only homegrown IT services firm that has shared a metric to measure the rise of GenAI. TCS, while declaring its fourth-quarter and full-year earnings in April 2024, said that the company had GenAI projects valued at $900 million last year.

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TCS, which returned ₹33,174.2 crore to Tata Sons through dividends and a share buyback in FY24, has emerged as the crown jewel for the conglomerate. Since the company went public in August 2004, it has returned ₹2,31,394 crore to Tata Sons in dividends and share buybacks, according to a Mint analysis.

Accenture Plc, which is twice the size of TCS, said in March that it won $1.1 billion in GenAI projects during the first half of the current fiscal year. Accenture, which follows a September-August financial calendar, said that GenAI is the fastest emerging technology to surpass $1 billion in sales.