zigma software ltd Management discussions

MANAGEMENT DISCUSSION AND ANALYSIS

FORWARD LOOKING STATEMENT :

This section of the Annual Report has been included in adherence to the spirit enunciated in the Code of Corporate Governance approved by the Securities and Exchange Board of India. Shareholders and Readers are cautioned that the opinions expressed by the management may be forward-looking statements in the current scenario, which is extremely dynamic, and increasingly fraught with risks and uncertainties. Actual results, performances, achievements or sequence of events may be materially different from the views expressed in the statement.

INDUSTRY STRUCTURE AND DEVELOPMENTS

Information Technology has made possible information access at gigabit speeds. It has created a level playing field among nations and has made positive impact on the lives of millions who are poor, marginalised and living in rural and far flung topographies. Internet has made revolutionary changes with possibilities of e-filing Income Tax returns or applying for passports online or railway e-ticketing.

Today a countrys IT potential is paramount for its march towards global competitiveness, healthy GDP, improving defence capabilities and meeting up the energy and environmental challenges.

The Indian Information Technology- Information Technology-Enabled Services (IT-ITES) industry has continued to perform its role as the most consistent growth driver for the economy. Service, software exports and BPO remain the mainstay of the sector. Over the last five years, the IT & ITES industry has grown at a remarkable pace. Consider some of the significant indicators for these remarkable achievements. The IT/ITES exports have grown to a staggering US$ 46.3 billion in 2008-09, the IT sector currently employing 2.2 million professionals directly and another 8 million people indirectly accounts for over 5% of GDP, a majority of the Fortune 500 and Global 2000 corporations are sourcing IT/ITES from India and it is the premier destination for the global sourcing of IT/ITES accounting for 55% of the global market in offshore IT services and garnering 35% of the ITES/BPO market.

The Indian IT-BPO sector including the domestic and exports segments continue to grow from strength to strength, witnessing high levels of activity both onshore as well as offshore. The companies continue to move up the value-chain to offer higher end research and analytics services to their clients. Indias leadership position in the global IT and BPO industries are based primarily on the following advantages.

India accounts for around 28 per cent of IT and BPO talent among 28 low-cost countries. It has a rapidly growing urban infrastructure fostering several IT centres in the country. Offshore service centres are spawning in the country due to operational excellence with low delivery cost, quality leadership and a conducive business environment. Favourable policy interventions, enabling infrastructure and augmenting a wide skill base from the government has further enhanced Indias brand image.

The Department of Electronics and Information Technology is coordinating strategic activities, promoting skill development programmes, enhancing infrastructure capabilities and supporting R&D for Indias leadership position in IT and IT-Enabled services.

OVERVIEW

The Company is proactively trying to seize the opportunity as initiated by the Government of India through Foreign Direct Investment in the Sector. This would be synergistic with the business of the Company and long-term benefits would accrue to the Company once the newly undertaken project scales to its culmination to enhance the value of shareholders with other stakeholders.

INTERNAL CONTROL SYSTEMS

The Company has adequate internal control systems for achieving efficiency in operations, optimum utilization of resources, effective monitoring thereof and compliance with applicable laws and regulations. The Audit Department conducts audits at various departments based on an annual audit plan with due weightage to the risk parameters associated with the business processes.

The Company regularly reviews the adequacy and effectiveness of the internal controls and suggests improvements for strengthening them.

HUMAN RESOURCES

In-house training Programme on various technical, attitudinal and supervisory aspects with the help of internal as well as external faculty, were conducted for employees after identifying their specific training needs in consultation with the respective departmental heads. The focus of the training was to create high performance culture as well as bringing an improvement in the organization.

The Company maintained cordial human relations throughout the year under review.

FINANCIAL PERFORMANCE

The details of the financial performance of the Company are appearing in the Balance Sheet and the Profit &Loss Account

OPPORTUNITIES, THREATS & OUTLOOK

The Company has invested in infrastructure development with a view to further cement the existing relationships and securing new customers. The Company maintains a persistent competitive focus with trusting and enduring partnerships with major technology company.

The Company also striving to resorts to strengthen its position by internally realigning its business and streamlining its operations with the definite intents of reducing cost and enhancing stakeholders value.

	On behalf of the Board
	P. Singhi, Whole time Director
Kolkata, 13th August, 2012.	N. Sachan, Director