Tuesday, October 08, 2002
The scrip of the software major recovered from an intra-day
low of Rs 128.20. Hughes Software (HSSL) registered volumes
of over 7.2 lakh shares on BSE till 14:15 IST.
In the 16 sessions between 12 September and 7 October 2002,
the scrip lost 28.6% to Rs 128.30 from Rs 179.85.
Dealers say the rise in the software stock is purely on buying
by operators, who have high hopes about the company's quarterly
performance .
As per analysts' expectations, for the quarter ended 30 September
2002, HSSL should post an impressive 40-48% rise in net profit
to Rs 8.8-9.3 crore on a 7-9% fall in net sales to Rs 48.6-49.8
crore.
Quarter-on-quarter, net profit is expected to zoom 100-111%
on a 2.5-5% rise in net sales. For the quarter ended 30 June
2002, the company posted a Rs 4.4-crore net profit and net
sales of Rs 47.4 ccrore .
Analysts say Hughes Software's profits were low in the April-June
2002 quarter as it had extraordinary write-offs in that period.
For Q1 ended 30 June 2002, HSSL registered a massive 76.5%
fall in net profit to Rs 4.4 crore compared to Rs 18.7 crore
in the corresponding period last year. Net sales decreased
25.3% to Rs 47.4 crore from Rs 63.4 crore in JQ 2001.
Analysts say the sustained fall in the company's earnings
was due to huge dependence on the telecom sector which was
witnessing a global slowdown. This is still a major concern
for the company.
HSSL is a specialist in convergent network software and a
leader in providing GPRS, UMTS as well as VoP software to
original equipment manufacturers (OEMs).
Last year, HSSL underwent a change in parentage, after General
Motors entered into an agreement to sell Hughes Electronics
Corporation to EchoStar Communications Corp (HEC) for $25.8
billion in cash and shares. HSSL derives substantial revenues
from HEC, which may continue.
In order to further de-risk its business and create added
new opportunities, HSSL has decided to enter into the business
process outsourcing (BPO) segment. This will be started as
an independent
operation.
HSSL is a subsidiary of Hughes Network Systems (HNS), a unit
of Hughes Electronics Corporation (HEC). HNS is a networking
company, dedicated to providing products and services to build
and operate digital communication networks worldwide. HNS
is the world leader in VSAT-based networks. HEC is a world
leader in the design, manufacture and marketing of advanced
electronic systems.
HNS India Inc is the principal shareholder in HSSL. As on
30 June 2002, the promoter holding in HSSL was 55.57%, while
institutions and the public held 15.9% and 10.4%, respectively.
Last updated : February 2, 2004
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