Wednesday, July 16, 2003
Sales growth expected at 55-60%
Software major Hughes Software Systems (HSS) has issued an
improved guidance for FY 2003-04 that pegs sales growth at
55-60%. The company had earlier put FY 2003-04 sales growth
at 35-40%. Profit after tax is expected to grow 60-70%, a
revision from the earlier forecast 40-45%
For Q2 ending 30 September 2002, the company sees a growth
in sales of 55-60% over the corresponding quarter of the previous
year. PAT is expected to grow 90-100% over the corresponding
quarter of last year.
Pradman Kaul, Chairman, Hughes Software Systems said while
issuing the guidance that the company's focus is on creating
the growth drivers for the future. Bottom line has started
to show results. "By prudently diversifying in the telecom
domain, our area of expertise, we have weathered the telecom
down turn and have come out stronger," he added.
HSS said that although the overall macro picture in the global
telecom industry was still hazy, it saw continued acceleration
in business and has built a strong backlog. Based on this,
the company is even more optimistic about the future and has
revised its financial guidance upwards for the
rest of the fiscal year.
Before trading hours today, HSS announced its first quarter
ended 30 June 2003 results - a massive 245.45% rise in net
profit to Rs 15.2 crore compared to Rs 4.4 crore in the corresponding
period of the previous year. Total income increased 57% to
Rs 78.3 crore from Rs 49.9 crore in JQ 2002.
HSS was incorporated on 13 December 1991. It is engaged in
the development of packaged software, providing share consultancy
services, and other ancillary products and services primarily
aimed at the telecommunications industry. HSS is focused on
the telecom sector and derives more than 53% of its revenues
from the wireless segment. However, the company is feeling
the pinch of the sluggishness in the telecom sector globally.
In order to de-risk its business and create added opportunities,
HSS has decided to enter into the business process outsourcing
(BPO) segment. This will be started as an independent operation.
HSS is also diversifying its revenue streams and is working
currently for a foray into the banking, financial services,
insurance (BFSI) segment.
In a major development on 14 July 2003, Australian media
giant News Corp, Mauritius-based HNSM and USA-based Hughes
made an open offer to the shareholders of Hughes Software
to acquire 20% stake in the company at a price of Rs 232,
a 17.4% discount to the current stock price of Rs 281. The
offer will open on 20 August 2003 and close on 18 September
2003.
The offer follows the global acquisition of 19.8% stake in
HSS' parent Hughes by News Corp from General Motors. News
Corp has also decided to acquire an additional 14.2% stake
in Hughes from the latter's shareholders. With the open offer,
News Corp would own 34% of the shares of Hughes.
As on 30 June 2003, foreign promoters held 55.44% stake in
HSS, while the public and institutions (including FIIs) held
15.93% and 11.14% respectively.
Last updated : February 2, 2004
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