Taksheel Solutions Ltd Management Discussions

TAKSHEEL SOLUTIONS LIMITED ANNUAL REPORT 2011-2012 MANAGEMENT DISCUSSION AND ANALYSIS The Management of Taksheel Solutions Limited presents the analysis of performance of the Company for the year 2011-12 and its outlook for the future. Business overview, Development and Opportunities Outlook The changing demand outlook, customer conversations and requirements acted as a driver to build in greater efficiencies and flexibility within the service delivery and the business models - one which is here to stay 2012 was also instrumental for more ways than one for the industry. While the industry displayed tenacity and resilience, it also commenced its journey to achieve its aspirations in view of the altered landscape. It commenced working on its agenda to diversify beyond core offerings and markets through new business and pricing models, specialises to provide end-to-end service offerings with deeper penetration across verticals transform the process delivery through re-engineering and enabling technology, innovate through research and development and drive inclusive growth in India by developing targeted solutions for the domestic market. All these measures, along with Indias game changing value proposition have helped India widen its leadership position in the global sourcing market. The advent of 2012 has signalled the revival of outsourcing within core markets, along with the emerging markets increasingly adopting outsourcing for enhanced competitiveness. Key demand indicators in the last two quarters such as increased deal flow, volume growth, stable pricing, and faster decision making has made the industry post good results. Though full recovery is expected in another two quarters, development of new growth levers, improved efficiency and changing demand outlook signifies early signs of recovery. Business Strategy TSL seek to further enhance our position as a leading provider of integrated IT Solutions and Services, to achieve this goal we seek to: Focus on Wealth Management Solutions (WMS) Your Company will continue to strongly focus on our main strength WMS, as it is one of the growing and evolving segments. We are adopting proactive target marketing for gaining market share in the Wealth Management Solutions market. Our solutions help WMS providers distribute investment products, provide advice and enhance their services. The solution is scalable and addresses all compliance requirements. It delivers customized and adaptive solutions for service providers having clients from the mass affluent to the High Net worth and covers the full spectrum of investment processes of Brokerages, Banks, Insurance Firms and other Wealth Management providers. Our solutions address account/data aggregation, online collaboration and workflow-based functionalities. Focus on Telecom products & Solutions. Your Company is majorly focused on providing customized solution in the area of Enterprise IP-Telephony, Unified Messaging System, Carrier Grade Solutions for wholesale retail clients over VOIP, VOIP Integrated Wireless solutions, IVRS, Voice Loggers, Video Conferencing, Network Monitoring & Management, Data Security Solutions. Our products range covers Analog, Digital & GSM PCI telephony Interface cards, Multi-functional IP Phones (Basic Executive and Advanced), Analog and GSM Channel banks. We are one stop shop providing complete range of telecom products required from SOHO office to Mid-Range and Large corporates. Growing our business through expand service offerings like BPO, KPO After concentrating on our core business activities for the last 11 years we are planning to expand our business through providing captive BPO and KPO offerings in Financial Services and Telecom areas. We have received requests from our existing and satisfied customers to provide this service. We expect these to materialize in the near future. Governance,Risk and Compliance business: The company has acquired Governance,Risk and Compliance in May2012. As part of GRC, Taksheel helps the client to design & implement: * Corporate governance structures and processes * Risk management systems aligned to strategic priorities * Business Assurance processes geared to provide independent and objective assurance on key business risks * processes and internal control systems that are suitable to address emerging business challenges * Framework to foster compliance with legal and regulatory requirements. * Framework for contract authoring & management Geographical expansion TSL is in the process of expanding our operations and we have recently started our operations from Warangal Development Center. We already have our presence in India and New Jersey. We propose to expand our operations in Asia-Pacific markets and Middle Eastern countries. Inorganic Growth TSL will continue to explore opportunities for acquisitions or joint ventures or alliances that leverage on the existing service offerings, cater to new client relationships or give us a presence in complementary markets. We will pursue strategic acquisitions and other inorganic initiatives that will strengthen our competitive position as well as drive profitable revenue growth. Invest in Our People and Culture As a people-based business, we continue to invest in the development of our professionals and to provide them with entrepreneurial opportunities and career development and advancement. Our technology, business consulting and project management councils ensure that each client team learns best practices being developed across our company and our recognition program rewards teams for implementing those practices. We believe these results in a team of motivated professionals armed with the ability to deliver high- quality and high-value services for our clients. INORGANIC GROWTH The Company is consciously following a strategy of organic and inorganic growth. Since inception we have made the following Acquisitions: Year of Name of Acquired Nature of Business Acquis- Company ition 2005 We have acquired 100% Wealth Management & IT Solutions to Equity in IBSS Inc Financial services Industry. 2007 We have acquired Data Warehousing & Business Intelligence business segments. businesses. 2009 We have acquired the Telecom Software Products Telecom Software Products 2012 We have acquired the Governance, Risk and compliance services GRC business Service Offerings Our business activities can be classified into three major segments: 1) Wealth Management Solutions (WMS); 2) Telecom & Managed services; and 3) Information Technology Services (IT). 4) Governance, Risk and Compliance services(GRC). I) Wealth Management Solutions (WMS) Your Company offers solutions to Banks, Asset and Investment Managers, Brokerage Houses, Insurance, Hedge Funds, Trusts and Family Offices .Our complete range of IT Services and solutions addresses the needs of both technology and business requirements to help organizations towards business improvement. WMS is provided through a Service Oriented Architecture (SOA) which enables us to deploy a customized version of its solutions to help the clients manage their customers assets, increase their sales, improve their service and generally lower their operating costs, by processing the transactions faster, reducing the scope for human errors and the need for entering data at multiple points. In a competitive market, providers of Wealth Management Services are forming their IT strategies to help build differentiating factors in their services/products in order to gain and retain customers and their assets. The right IT resources can help Wealth Management Firms to: * Improve client service from reporting to call centers; * Attract and retain top advisor and/or customer service talent; * Reduce operational and administrative inefficiencies; * Generate added revenue by rapidly developing and deploying new value- adding products and services; * Achieve real competitive advantage. Taksheel brings together domain knowledge, technological capabilities and its global delivery model to offer the best results and returns on IT investments of its clients. Taksheels Wealth Management Solutions (WMS) are cost effective. They create competitive edge to the client company by enabling efficient and effective service delivery/management. Technology architectures do not easily accommodate integration without the aid of middleware solutions. Indeed, unless a financial institution has the resources and funds to front the integration issue in-house, our company has to depend on outside vendors in the marketplace who can tackle the integration issue. Thus, a key issue Financial Services Providers face during technology deployments is integrating disparate applications and systems. While it is complicated enough to introduce new systems in a technology environment, making sure these connect to each other efficiently is another task for technology departments. Wealth Management front-office activities such as Portfolio monitoring and trading rely on the ability to connect to back-end Portfolio Management, Accounting, and Compliance processes. In addition, institutions wish to capture vital client data and documents which may be generated through front-office activities and ensure they get captured in the back office. Without these types of connections, an institution cannot hope to deliver superior service. Our Wealth Management Solutions provide ease of integration between Portfolio Management/Financial planning systems, Account aggregation vendors, Market data providers, and CRM systems. In addition, we have expertise in deploying, managing, maintaining and integrating front office and middle/back office services to an end-to-end solution, unifying all business processes and adding a broad range of features and functionalities. 2. Telecom & Managed services Taksheel developed technology which is unique, versatile and state of art products made us integrated Telecom and IT services provider. As IT & Telecom integrated technology partner we offer our service on pay for use by providing our products and services on hosted basis. Revenue sharing as model for aggregator business platform and other SaaS model products and services. Growing demand getting down capex, as technology driven company we had focused in offering products & services as pocket suitable solution in SaaS model. 3. Governance,Risk and Compliance (GRC)business: The company has acquired Governance,Risk and Compliance in May2012. Taksheel provides GRC software solutions along with domain expertise which provides integrated approach (internal audit, compliance programs like SOX, enterprise risk management (ERM), operational risk and incident management, etc.) helps Banking & Financial institutions, manage all aspects of Governance, Risk, Compliance and Audit programs in a far more superior manner. The integrated GRC process approach deploys a single system which administers multiple GRC initiatives & increases compliance effectiveness in a cost effective environment. Additionally, it provides a coordinated and cross-organizational approach to risk management. As a result, GRC initiatives are not only aligned centrally with corporate governance and reporting but are distributed to lines of business for execution and accountability. Competitive Strengths Your Company believe that the following are our principal competitive strengths, which differentiates us from other IT solutions providers: * Wide Range of Wealth Management Solutions * Advantage of Early Entry * Unique, Versatile and State of the art Telecom products * Depth of experience and knowledge in targeted industry segments * Ability to Manage and Establish Enduring Relationship with Large Clients * Qualified Professionals and Strong Management Team Threats The industry risks suck as pruning of IT budgets, fluctuations of Rupee vis-a-vis dollar, adverse changes in tax structures also are faced by the company.Other risks are client concentration, geographical concentration of clients, competetition in industry etc., These risks are monitored constantly and derisking measures are initiated appropriately. Core Competencies: The Company is specialized and developed products in IP multimedia subsystem(IMS), Telecom Signalling Integrated Standard Digital Network (ISDN), Channel Associated Signalling (CAS), Signalling System 7(SS7), Short Message Service Centre (SMSCs), Least Cost Routing system (LCR), Optimal Routing Solutions (ORS), Voice Mail Servers (VMS) and other Value Added Services (VAS) content delivery platforms. Our product portfolio covers enterprise IP-Telephony, Unified Communication System, Carrier Grade solutions, Wireless VOIP solutions, IVRS, Voice Loggers, Video Conferencing, NMS and other IT Solutions. With products and services offered by us, we had secured business from various sectors CGISS, Healthcare, Defence, Domestic and Multinational enterprise and government organisations.Governance,Risk and Compliance(GRC) is an added strength to the overall portfolio. COMPANY PERFORMANCE Table:1 Financial figures of the Company for the last five years (Amount in Rs. lacs) PARTICULARS FOR THE YEAR ENDED MARCH 31 2008 2009 2010 2011 2012 Income Software & Consultancy Services 3171.68 3319.53 4950.15 14726.37 17214.51 Other Income 31.29 223.50 0.00 -134.22 255.07 Total Income 3202.97 3543.03 4950.15 14592.15 17469.58 Total Expenditure 1617.50 3299.89 4141.14 11850.55 15804.89 Profit Before Tax (PBT) 1585.47 243.14 809.01 2741.60 1664.69 Profit After Tax (PAT) 1403.21 240.42 809.01 2741.60 1333.71