January 19, 2009
| The Economic Times
'We remain cautiously optimistic': Vishnu Dusad
NEW DELHI: Nucleus Software reported a rise in expenses by 25% whereas its PAT fell 32%, even though the stock rose 2.5% on the back of a rising topline.
The Noida based IT product company's CEO Vishnu Dusad says that despite the economic slowdown he is bullish on business and plans to curtail the impact of company's expenses on it's margins. Excerpts: What's the reason behind a fall in the net profit on a yearly basis? Will the fall continue in the coming quarters as well?
Our quarterly net profit fell 32% year over year because of a 25% rise in our expenses. But our consolidated revenue for the quarter ending December 31, 2008, increased by 14% to Rs 84.24 crore from Rs 73.64 crore for the same quarter last year.
With total expenses increasing by 25% , the consolidated EBITDA declined to Rs 15.21 crore in comparison to Rs. 18.51 crore for the corresponding quarter of last year. How do you plan to curtail the company's rising expenses?
We are trying to curtail our expenses like on travel and telecom. For instance, we have made it essential to travel by budget carriers, Rather than single occupancy rooms, we now use double occupancy rooms for lodging while on client visits. We hope to curtail it in the next quarter. Also, we are trying to switch to IP telephony to cut telecom costs.
We are higher prepared for a higher topline, but hope to bring down the expenses in the coming quarters.Will the Satyam fiasco hurt business to Indian IT companies?
Lets accept that an accounting scam of the size as Satyam's scale, surely does raise eyebrows. And the foreign media is also trying to make it an Indian IT industry phenomeonon. Foreign MNCs might also be using covert means to win business by downplaying Indian IT companies. But in the long run everybody will realize that Satyam was an exception rather than a rule. The value proposition of Indian IT companies remains strong. Do you see the economic slowdown affecting your business pipeline?
We are seeing an increase in business from geographies like Middle East, and countries like Malysia and Indonesia. We remain cautiously optimistic for the year ending March 2009.