The Hindu Business Line : Polaris Soft ties with Citigroup vibrant

Polaris Software Lab's revenues from Citigroup are consistent, at over $100 million (around Rs 460 crore) every year, according to Mr Arun Jain, Chairman and Managing Director, Polaris, a Chennai-based software company.

"This is one of the largest relationships for any company and we can take pride in this. We are delivering mission-critical applications and transactions worth $12 trillion pass through their portal technologies," he told a recent conference call with analysts to discuss the company's June 2006 quarter financial results.

"We need to get into smaller areas through the Intellect business and make the Citigroup business a more locking relationship." Citigroup, a global financial company, contributed 51.7 per cent of Polaris' consolidated revenue of Rs 232.05 crore during the June 2006 quarter.

On a conservative note, the company would like to have 5-7 per cent business growth, and build substantially from that point and move ahead. "Against our business plan we have exceeded in the first quarter and we expect to do better in coming quarters as well," he said.

The 5-7 per cent is from new accounts itself. Growth in Citibank revenue may also happen and will be good for the overall growth of the company.

In this year's business plan, Polaris has not assumed any significant growth in Citibank business, but will concentrate more on keeping the present business intact, he said.

Onsite growth

"We need to start assignments onsite where we need to work with the customers closely. This leads to higher revenue and high profitability, because the rates are better. There is a general impression that onsite business does not give high profit. But, if the rates are over $55 to $70, then onsite business will give as much profitability as offshore business," he said.

Polaris is likely to hire 1,000-1,500 people this year. As of the current quarter, it will add another 300 and close to 500 in Optimus Outsourcing Company, a wholly owned subsidiary of Polaris and a business process outsourcing service provider. At the end of June quarter Optimus has about 1,000 people, he said.

Promoters' stake

On the company's promoters (Mr Jain, his family members and Polaris Holdings Pvt Ltd) increasing their stake to 27.84 per cent as of June end from 24.05 per cent in March quarter, Mr Jain said there were two reasons. "I think you do not get these opportunities in a life-time of an organisation. So, that is a very honest answer to that. Second, is to give a confidence in the market place that leadership team is excited about the growth and has a confidence on the story that it created over the last three years, and it is a time of reaping that benefit. So, if the market unfortunately does not recognise the story, it is a good time to increase the stake."

Citigroup, a global financial company, contributed 51.7 per cent of Polaris' consolidated revenue of Rs 232.05 crore during the June 2006 quarter.

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