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Omnitech InfoSolutions Ltd.: Experts' corner
532882 OMNITECH Group (T) BSE data
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Management speaks
Atul Hemani
Atul Hemani
Managing Director
Omnitech InfoSolutions Ltd.
February 9, 2010, 2:22 pm
Why should an investor buy your company's stock?

Omnitech is a growing organization and in the past five years, we have grown at a CAGR of 30% YoY. Over the years, we have successfully metamorphosed ourselves to becoming a leading IT technology service provider and a pioneer in Business Availability and Business Continuity Services. We have the first mover advantage in India in the Business Continuity space and have come up with India’s first third party multi location Disaster Recovery Centre, “Omnicenter”.

We have been able to outgrow our organic growth by introducing innovative services/solutions, which are apt for the current market situation. Our endeavor to focus on technology center and automation based delivery model from traditional, linear, people-based model has helped us to maintain our profitability and get an edge over our competition. I think we at Omnitech are at a sweet spot of the right size, right team, right goodwill, vast global experience, existing customer base and support from investors. The stage is set for exponential growth in future and this is just a perfect beginning!

 We have always been conservative in our approach and realise our responsibility towards our investors’ hard earned money. We remain focused and aggressive, yet cautious. We have and will continue to take the right decisions at the right time, which was justified by our decision of not to pursue the acquisition plan last year given the economic scenario then.

We have been able to generate consistent returns for our investors over a period of time and the Return on Capital employed has been around 27% for the past couple of years. We are confident that we would continue to deliver the same in times to come. We are in high growth phase and have a three-year plan lined up to achieve a multi fold growth. A midsized company backed by strong and confident management and having ambitious, yet practically viable plans of expansion definitely looks as a promising opportunity to invest and grow.

What events do you expect in your industry sector over the next few months? Are these hurdles or catalysts?

As always, only change is constant for the IT sector. According to me, how an organisation aligns itself and leverages the situation is most important. The inflection points capitalised by remaining on leading edge serve as great catalysts and if not, they become hurdles to be overcome.

We see a paradigm shift around the corner for IT industry by way of cloud computing. IT has become an integrated part of almost all businesses and hence it is needed to be available on demand in desired sizes, shapes and so on. IT seen more as utility and Cloud computing is a perfect answer to these changing business dynamics.

Another aspect is end-to-end technology outsourcing, which may be delivered using cloud or otherwise. More and more organisations will focus on their core business and outsource non core activities. Companies which can provide non core activities with higher efficiency, flexibility, scalability and most importantly cost effectively, will succeed in this space. We at Omnitech are rightly poised to take the advantage of this inflection point.

There are other factors like geo-social, political and economical, which will play the role to some extent. When we look at the business from overall globe perspective, such aspects may be of temporary nature and not very significant.

I believe end-to-end IT outsourcing and cloud computing are catalysts. “Obstacles are what you see when you take eyes off the goal”.

What growth initiatives has your company planned?

Our thought leadership in Disaster Recovery & Business Continuity business, capabilities in Remote Infrastructure management services, innovation in IT resources optimization solutions and leading edge technology solutions like Data Center Management and Cloud Computing has been and will be our key thrust areas. 

We also feel that our highly flexible and customized Business Availability services and end-to-end IT outsourcing will help customers optimize their IT spending and reduce costs. Also customers are looking for a one-stop shop, where they can find a partner, and not a mere vendor. We feel that our service offerings are well-suited for the SMEs and this is where we feel there is a huge potential to grow organically.

In order to suffice to our growing needs, we plan to invest in creation of couple of more recovery centers pan India as well as in the international market. We are also actively working to grow inorganically through strategic investments or M&A. We have plans to invest around 50 crore INR in building new centers and around 60-70 crore INR for inorganic growth.

Who is your competition? What differentiates you from them?

We face competition directly from the big fives. This is because the kind of services offerings we have, no one in the mid market comes in direct competition with us. But on a standalone service basis, we face competition from Allied Digital, CMS, Patni, Zenith, Zensar, etc.

Our Business Availability and Business Continuity Services give the customer a complete end user experience. This is where our Infrastructure Management Services coupled with Application Management and Performance Management services provide end-to-end services under one roof. This, I feel, is our USP and the biggest differentiator.

How do you see your company performing over the next financial year?

We see strong growth for the next financial year, which would be fuelled by organic as well as inorganic route. We are planning to expand into newer geographies and at the same time, constantly innovate to stay ahead of the curve. We also plan to expand our service offerings, which would help us obtain a greater share pie of the total pie.