The Hindu Business Line : PSI Data eyes niche space in 3 verticals

Mr Sampath Iyengar, CEO, PSI Data Systems, said the company expects to grow in line with industry estimates for FY07. The IT services industry is expected to grow at between 28-30 per cent for the current year. Post-acquisition by the AV Birla Group in 2001 from Groupe Bull, PSI had slipped into the red and remained there for almost four years.

PSI's consolidated revenues for FY06 were almost flat at Rs 85.78 crore as compared to previous year's Rs 82.13 crore. The company posted a net profit of Rs 1.83 crore for FY06 as against a net loss of Rs 2.43 crore in the previous year. Higher net profits by its wholly owned subsidiary, Birla Technologies Ltd, has helped PSI Data to get into the black for FY06.

Bolstered by the turnaround, the stock hit a 52-week high of Rs 195, a week ago on April 24. The stock has gained 18.5 per cent over the past one month; it closed at Rs 171 on Friday, a gain of five per cent over the previous close. The AV Birla Group owns 70.4 per cent stake in the company.

Mr Iyengar said PSI was targeting three specific verticals of banking and financial services, hi-tech manufacturing and life insurance. "We aim to be niche player in these verticals," he said, adding that the company was in the process of incubating its life insurance practice. The company, which has about 500 people, expects to add another 100-150 during the current year.

The company added 11 new clients during FY06 and improved its offshore leverage as majority of the new projects won had a significant offshore component, he said. PSI's offshore-onsite ratio stood at 52:48 at end of FY06 as compared to 33:77 a year ago. "We expect to maintain the offshore, onsite mix at the last year's level," he said.