The Hindu Business Line : Cerebra plans equity infusion of $8-10 m, BPO foray

CEREBRA Integrated Technologies plans equity capital expansion in near term as it aims to vault back to black with revenue topping Rs 100 crore in 2004-05, according to Mr V. Ranganathan, Chairman and Managing Director.

The company, which lost substantial business tracking the IT meltdown since 2002, plans to revive itself through fresh initiatives in software products and services as well as hardware manufacturing and foray into business process outsourcing.

It is likely to tap banks for working capital needs and seek equity funding in the range of $8-10 million, Mr Ranganathan said. "It is in a preliminary stage. We hope to close the deal in 3-4 months."

Cerebra is also likely to mandate a merchant banker towards capital raising and could expand its capital base through fresh issue of shares and then privately place part of them to raise the funds, he added.

The company plans to start its BPO operations to cash on the current rush in process outsourcing. It is likely to set up a 250-seater call centre to start with; the BPO operation is likely to have close to 40 per cent voice-based transactions, with claims processing accounting for the rest.

According to Mr Ranganathan, there are "serious" enquires from two overseas enterprises for insurance claims processing and data conversion.

The call centre venture is likely to involve an investment to the tune of Rs 3-4 crore. "We are expecting a billing of Rs 50 crore in 2004-05 in the call centre venture. If it is up and running, we will be able to report net profit for the next fiscal."

However, he did not give details about the expected sales or loss for the current fiscal. "It will be almost nothing. I do not want to talk about it."

The company is banking on the recent excise sops extended to PC manufacturers to bring down prices and gain market share in a fiercely competitive market.

Cerebra plans to increase its dealer network to 450 from the current 250 in 12 months and focus on the home segment to spur growth.

It also plans to tie up with chipmaker AMD and offer new personal computing devices, including laptops.

Cerebra expects to report sales of close to Rs 40 crore in its hardware division in 2004-05.

The company also plans to offer itself as a contract manufacturer for other PC makers to utilise its production capacity.

In the software services sector, the company plans to focus on telecom, CAD-CAM and embedded technologies to drive its growth.