NASDAQ-listed Sify Technologies is all set to offer net telephony by acquiring the new Unified Licence for telecom services. The company, which is now focussing on the enterprise segment, is planning to offer voice services as one of the applications to its clients.
Speaking to Business Line , Kamal Nath, CEO, Sify Technologies Ltd said, “We are evaluating Unified Licence. It seems to be a natural progression for us.”
Five biz units
The company, which had started out as a pure play Internet services company, has embarked on a transformation plan. At the heart of this initiative is the company’s aim to become an IT services company that also offers telecom infrastructure.
Nath said that 5 business units have been created as part of the Sify 3.0 plan. These business units would focus on offering a range of services, including data centre solutions, cloud-based applications, system integration and telecom infrastructure.
He said the company will slow down its investments in the retail Internet services segment. “The game has changed as retail Internet services has moved to mobile devices. We now have 3,000 enterprise customers and that’s where our focus is,” Nath said.
Sify recently bagged a contract from the postal department valued at over Rs 900 crore and another from a leading financial services player in South India. Nath said that Sify has made Noida its business headquarters while Chennai would continue to be the corporate headquarters.
The revamp is beginning to pay off for the company. During the first quarter this fiscal, its net profit was Rs 16.3 crore as against a net loss of Rs 1.6 crore for the previous quarter.
Multiple segments
Analysts, however, said the company has entered multiple areas without seeing success in any.
“It is difficult to identify Sify as a pure networking, content or software company. IT companies in India have seen spectacular growth in the last 10 years, as they have leveraged India’s low-cost technical manpower to build multi-billion dollar businesses. Sify, on the other hand, has gone from one low to another low. I think the company’s lack of focus and strategy is the biggest problem with Sify,” Sneha Shah, the Editor-in-chief of Greenworldinvestor wrote in a blog at investment research Web site SeekingAlpha.com.
The Sify stock, which was at one time valued at over $300 a share, now trades at less than $2 on the NASDAQ.
Nath, however, is confident that the new plan will bring Sify Technologies back on track. “This quarter’s result is a clear reflection of Sify 3.0-led strategy and execution plan which were laid down three quarters back. There is a significant growth in multi-tower engagement with existing and new customers, average deal size and revenue from existing customer base.”