Sudhakar Ram, Chairman, Managing Director and CEO, Mastek Ltd is a silver medalist from the Indian Institute of Management (IIM), Calcutta. He is responsible for consolidating growth in markets across the globe. He is at the helm of several initiatives in technology, applications, processes, customer deliveries and business development. He was the recipient of the CNBC Asia’s India Business Leader of the year award in 2007. Before joining Mastek, he was the CIO of Rediffusion Dentsu Young & Rubicam. Sudhakar is also an anchor and lead contributor of The New Constructs.
Mastek Limited is a leading IT player with global operations providing enterprise solutions to insurance, government, and financial services organizations worldwide. With its principal offshore delivery facility based at Mumbai, India, Mastek operates across North America, Europe, and Asia Pacific regions. Incorporated in 1982, Mastek has been at the forefront of technology and has made significant investments in creating intellectual property, which along with proven methodologies and processes, increase IT value generation to its customers through onsite and offshore deliveries.
Yash Ved of IIFL provides highlights of a media interaction where Sudhakar Ram says “About 50% of our revenue comes from UK, 42% from North America and 8% comes from India and Asia Pacific region.”
Brief us about your Q3 performance?
We have had a strong quarter with growth momentum across all geographies and significant improvement in profitability. The results in this quarter were positive. It is back to profit after almost six quarters.
We have maintained healthy growth in topline in rupee and dollar terms. Globally, there was encouraging growth in UK, order book pipeline in US is good and Indian geography has grown pretty well. The overall momentum in the insurance side is encouraging.
This quarter saw about 39% of our business coming from Insurance verticals, 30% from Government verticals, while 31% came from life, annuity and Pensions and Financial services.
Brief us about your new client wins?
The company added 5 new clients during Q3FY12. This is on the back of 4 client wins in Q2FY12, taking the total number of clients to 95 at the end of Q3FY12. The wins during the quarter were primarily from North America and India Asia Pacific region.
What is your current order backlog?
Mastek's 12-month order backlog was Rs 4.01bn as on 31st March 2012, as compared to Rs 3.69bn at the end of the previous quarter ended 31st December 2011, reflecting an increase of 8.7% in rupee terms.
Any acquisition plans?
We are always in the lookout for companies, but we have no plans for the next two quarters.
What are your international plans? How much does it contribute to your revenue?
UK has shown improvement, while North America business has shown marginal growth.
About 50% of our revenue comes from UK while 42% comes from North America and 8% comes from India and Asia Pacific region.
Brief us about your financials?
The operating revenue was Rs 1.84bn during the quarter under review as compared to Rs 1.72bn during the sequential previous quarter reflecting an increase of 6.9% in rupee terms. In constant currency terms, the revenue growth has been 9.2%.
Total income was Rs 1.88bn during the quarter under review as compared to Rs 1.75bn during the sequential previous quarter reflecting an increase of 7.2% in rupee terms.
Overall improved performance helped the company to post EBITDA of Rs 176mn (9.4% of total Income) compared to Rs 56mn (3.2% of total income) In Q2FY12.
Net profit stood at Rs 71mn in Q3FY12 as against net loss of Rs 15mn in Q2FY12.
The product development spends during the quarter was Rs 122mn as compared to Rs 115mn in Q2 FY12
What is your current cash level?
The company continues to have a healthy balance sheet with Rs 1.29bn in cash & equivalents (including liquid investments) as on 31st March 2012 as compared to 1.13bn in Q2FY12.
What is your current employee strength?
As on 31st March 2012, the company had a total of 2,983 employees, of which 2,119 employees were based offshore in India while the rest were at various onsite locations outside India. Employee count at the end of 31st December 2011 was 2,926 employees.
We will add some employees in the next quarter.