Shortlists cos in India, overseas
Bangalore, Aug. 7
Infotech Enterprises is eyeing acquisition to boost its portfolio of engineering and geospatial services, and has short-listed two companies, one each in India and overseas for the proposed buy-out.
The Infotech Chairman and Managing Director, Mr B.V.R. Mohan Reddy, said the company was evaluating two companies and may eventually acquire one depending on the skill-sets.
However, Mr Reddy declined to comment on the size or the timeframe for the buy-out.
The company currently has a cash reserve of close to $10 million on its balance sheet.
"We may use a combination of both debt and equity to fund the acquisition if the cost exceeds $10 million," Mr Reddy said, adding the company was yet to firm up funding plans.
Further, as part of its diversification plans, Infotech is looking at entering the automotive vertical in the engineering services space. "We are looking for a consultant who could help us tap the automotive vertical, which holds a lot of promise," Mr Reddy said.
Infotech's engineering services division is largely focussed on the aerospace sector and accounts for some 55 per cent of the total revenues, while the Geospatial Services division accounts for the remaining 45 per cent. Infotech's clientele consists of companies such as Pratt & Whitney, Bombardier Transportation, Hamilton Sundstrand, British Telecom, Alstom among others.
Infotech reported a net profit of Rs 19.75 crore on revenues of Rs 117.03 crore for the quarter-ended June 2006 as compared to a net of Rs 9.57 crore on revenues of Rs 78.2 crore in the corresponding quarter last year. For the current year, Infotech expects its net profit to grow between 10.5 and 11.5 per cent. Revenues are projected to grow between 36 and 41 per cent. The operating margins for the year are expected to be between 18.5 and 20 per cent.