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Zicom Electronic Security Systems Ltd, the BSE and NSE-listed security company, is betting big on government business to grow its revenues over the next two years.
After selling off its project business (government and institutional clients) to Schneider Electric India for ₹225 crore in 2010, Zicom has re-entered the business after completing a four year non-compete agreement with Schneider in May 2014.
“The market size for our project business is approximately $1 billion at present and is expected to grow at a compounded annual growth rate of 20 per cent over the next few years. The major driver for revenue growth for us will be from upcoming government projects, such as the Smart City projects, Govt City Surveillance projects and Govt Infrastructure projects.
For instance, we will be bidding for the Madhya Pradesh Govt tender which was released recently to install 10,000 surveillance cameras in various districts” Pramoud Rao, Founder Managing Director of Zicom, told BusinessLine .
Rao said he is targeting ₹50-100 crore revenue from the Government business in fiscal year 2016, through government orders that the company expects to win over the next 6-12 months. “Our commercial buildings business, which contributed to 60 per cent of our overall revenue and which has not been doing well over the last 24 months as a result of slowdown in spending, will be overtaken by our government business over the next 12 months,” he said.
Building new teamSince Zicom’s project business team is now a part of Schneider Electric India, Rao said he is looking to build a new team for the same. “We have the technology, the experience, the expertise and domain knowledge of the security and surveillance business. However, we now have to hire a whole new team for the government business.”
Since IP (Internet Protocol) and Networking constitutes 70-80 per cent of the govt business and security hardware constitutes the remaining component, Rao is currently focused on hiring IP and Networking professionals for the government business.
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