Saturday, October 12, 2002
In a restructuring move, Hughes Software Systems (HSS), the
New Delhi-based telecommunications software company, today
announced that it would also offer software development and
services to banking, insurance and financial services sector
companies in future.
The company has so far concentrated only on the telecommunications
sector and had taken a severe hit as the global telecommunications
market went on a tailspin following the global economic meltdown.
"We are putting together a team which is working on
a business model for the new business. This would work as
a division of HSS," Arun Kumar, president and managing
director, HSS, said today while announcing the company's second-quarter
results. As a part of the strategy, the company is
also looking at acquiring a small-sized software company in
the banking, insurance and financial services space in a cash-cum-stock
deal.
"Discussions are on to acquire a company with about
100 people. This would give us the necessary momentum in terms
of people and domain expertise to enter the space," Kumar
said. He however refused to talk about the company's expectations
from the new line of business. "I think it is too
early to comment on this. We expect the business to be operational
from next financial year onwards," he said. The company,
which has also recently made a foray into the business process
out sourcing (BPO) sector is also expecting good dividends
from the business. Besides, aided by the take up in the telecom
service provider business, pick up in business and cost rationalisation
initiatives, the company has projected a 10 per cent growth
in sales for the next quarter.
"We have already implemented several measures to diversify
revenues and have cost structure more commensurate with revenues.
Our strategy to aggressively grow existing relationship with
the equipment manufactures and telecom service providers segments
is showing progress. We expect that HSS strategy of diversifying
into new verticals will show the desired results in the medium
to long term. The broadened offering will help HSS de-risk
its business and reduce dependence on the telecom vertical,"
Kumar said.
HSS today reported a 32 per cent rise in its net profit for
the second quarter ended September 2002 at Rs 8.3 crore compared
with Rs 6.3 crore in the same period last year.
During the period, the firm's net sales was pegged at Rs
52.1 crore as against Rs 53.6 crore during July-September
2001.
Last updated : February 2, 2004
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