The company, when it had gone public in October 2005, its entire focus had been on developing software for small and medium scale businesses in US. With the bigwigs in the industry itself gasping for life right, it is little wonder that small and middle rung companies like Prithvi are able to sustain and yet post some improvement in performances. And this is precisely the reason why the stock has fallen down from the levels of Rs.300 to now rule at Rs.150.
The financial performance for the third quarter ended 31st December 2007 has not been very good. On QoQ, its net sales rose by just 10% at Rs.291.73 crore. Its total expenditure rose 29% of which software development expenses, which till Q2 represented 98% of the total outgo, has come down to 79%. This resulted in the EBIDTA showing a fall of 44% at Rs.35.66 crore. PBT registered a rise of a meager 3% while PAT rose by a measly 5% at Rs.28.40 crore. On an equity of Rs.18.08 crore, it managed to post a good-looking EPS of Rs.15.71.
The main objective of the IPO was to build an offshore delivery centre with 1,500-seat capacity in Hyderabad at a cost of Rs.150 crore, of which, till 31st December 2007, it has spent Rs.62 crore. It’s been over two and half years and it is yet to fully implement the project? Does not speak too well about the management abilities of the company.
And maybe realising that it needs to move on beyond being a mere IT service provider, the company is now trying to gain some foothold in telecom. The company bagged an order of Rs.309 crore from BSNL, for supply of transmission equipment that helps increase network bandwidth. Prithvi has tied up with a Chinese telecom major, Huwei Technologies to source the equipment and is customizing it for BSNL.
Considering annualized EPS of Rs.60, remain invested.
The financial performance for the third quarter ended 31st December 2007 has not been very good. On QoQ, its net sales rose by just 10% at Rs.291.73 crore. Its total expenditure rose 29% of which software development expenses, which till Q2 represented 98% of the total outgo, has come down to 79%. This resulted in the EBIDTA showing a fall of 44% at Rs.35.66 crore. PBT registered a rise of a meager 3% while PAT rose by a measly 5% at Rs.28.40 crore. On an equity of Rs.18.08 crore, it managed to post a good-looking EPS of Rs.15.71.
The main objective of the IPO was to build an offshore delivery centre with 1,500-seat capacity in Hyderabad at a cost of Rs.150 crore, of which, till 31st December 2007, it has spent Rs.62 crore. It’s been over two and half years and it is yet to fully implement the project? Does not speak too well about the management abilities of the company.
And maybe realising that it needs to move on beyond being a mere IT service provider, the company is now trying to gain some foothold in telecom. The company bagged an order of Rs.309 crore from BSNL, for supply of transmission equipment that helps increase network bandwidth. Prithvi has tied up with a Chinese telecom major, Huwei Technologies to source the equipment and is customizing it for BSNL.
Considering annualized EPS of Rs.60, remain invested.
Source: sptulsian.com
