Project Report on Zensar Technologies for Managerial Economics

Case Study: Zensar Technologies For

Managerial Economics By

Renzil D’cruz

Web Presence:

about.me/renzilde

linkedin.com/in/renzilde

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Under Guidance of

Dr. P.A.Johnson

Zensar Technologies

Our Mission Leveraging technology and processes to help customers attain their goals.

Our Vision Transformation partners to global corporations.

About Zensar Zensar Technologies is a global information technology services and business process

outsourcer headquartered in Pune, India. It is a software wing of RPG Group, and offers a range of

integrated information technology (IT) and BPO products and services to Fortune 500 clients.

Zensar has a marketing presence in the US, Europe, Asia Pacific and Australia. The company has operations

and a customer base spanning across 18 countries including software development centres at Pune and

Hyderabad in India and Gdansk in Poland.

Zensar service areas include Application Support and Development, Application portfolio management,

Testing, Enterprise Collaboration and Content Management, Enterprise Application Integration, Business

Intelligence & Data Warehousing. Zensar's core competency is Application Modernization, using Zensar's

SBP framework.

Zensar is the world's first enterprise-wide SEI CMM Level 5 Company with activity that spans across

Utilities, Retail and Distribution, Banking, Financial Services and Insurance, Manufacturing and

Telecommunications.

Zensar Technologies (Parent Company RPG Group) provides Services such as Application Portfolio

Management, Enterprise Application Service, Innovative Technology Services, Business process

outsourcing and optimisation, First Time Outsourcing and it is 3,000 crore (US$567 million) company

having more than 7000 employees dated April 2012.

Achievement Highlights Zensar profit net up by 35 % at Rs 20.22 cr - Leading software solution company and BPO services provider

Zensar Technologies Ltd has reported a good year-on-year profit growth for the quarter ended December 31.

It posted a y-o-y net profit of Rs 20.22 crore as against Rs 15.02 crore posted during the same period of the

previous year reflecting a growth of 34.6 per cent.

Key People Dr.Ganesh Natarajan, Vice Chairman & CEO,Zensar Technologies.

Vivek Gupta, Chief Executive, IBS and Executive Chairman, Akibia

Nitin Parab, Chief Executive and Global Head, Enterprise Transformation Services (ETS)

Harish Gala, Global Head, Enterprise Applications (Oracle and SAP)

Yogesh Patgaonkar, Global Head, Human Resources

Sanjay Marathe, Head, Strategic Services Unit and CTO

Ajay Bhandari, Chief Corporate Development Officer

S. Balasubramaniam, CFO

Scrip ID : ZENSAR

Scrip Code : 504067 (BSE)

Industry : IT Consulting & Software

Company :ZENSAR TECHNOLOGIES LTD. 504067

Period: Year 2008 to Year 2012 (All Prices in )

Year Open High Low Close No. of

Shares

No. of

Trades

Total

Turnover

Deliverable

Quantity

% Deli.

Qty to

Traded

Qty

* Spread

H-L C-O

2008 192.00 203.70 71.00 78.35 32,07,206 50,998 43,42,47,053 19,43,515 60.60 132.70 -

113.65

2009 81.00 351.00 64.65 324.10 55,35,846 83,647 1,16,74,84,788 31,09,765 56.18 286.35 243.10

2010 326.00 365.90 151.15 166.65 64,31,592 1,40,373 1,84,34,12,495 25,49,743 39.64 214.75 -

159.35

2011 167.00 193.30 113.15 143.30 18,94,760 60,699 31,00,39,077 9,79,811 51.71 80.15 -23.70

2012 143.25 302.45 133.55 296.85 48,88,293 1,63,593 1,07,25,96,009 16,48,760 33.73 168.90 153.60

* Spread

H-L : High-Low

C-O : Close-Open

Price Movement

Index Comparison

Performance Chart

Ownership Pattern

Annual Trends

(in Cr.) 2011 - 12 2010 - 11 2009 - 10 2008 - 09 2007 - 08

Income Statement(View in (Million))

Revenue 712.75 584.52 502.32 428.00 335.87

Other Income 27.91 7.31 2.91 2.62 11.91

Total Income 740.66 591.83 505.23 430.62 347.78

Expenditure -577.36 -478.85 -393.18 -341.11 -282.36

Interest -1.03 -0.86 -0.55 -0.54 -1.12

PBDT 162.27 112.12 111.50 88.97 64.30

depreciation -25.05 -25.88 -24.92 -22.29 -15.64

PBT 137.22 86.24 86.58 66.68 48.66

Tax -42.67 2.24 -2.43 -6.21 -3.29

Net Profit 94.55 88.48 84.15 60.47 45.37

Equity 43.41 43.30 21.58 23.97 23.96

Reserves 374.01 341.27 272.34 230.46 181.05

EPS 21.79 20.47 35.77 25.23 18.95

CEPS 27.55 26.41 50.54 34.53 --

OPM % 22.91 19.33 22.31 20.91 19.48

NPM % 13.27 15.14 16.75 14.13 13.51

Detailed Detailed Detailed Detailed Detailed

Consolidated Consolidated Consolidated Consolidated Consolidated

Type Audited

Date Begin 01-Apr-11

Date End 31-Mar-12

Description Amount (Rs. million)

Net Sales / Income from Operations 7,127.50

Net Sales / Income from Operations 7,001.70

Other Operating Income 125.80

Expenditure -6,024.10

Other Expenditure -1,262.00

Employee Benefit Expenses -4,277.30

Depreciation & amortization expense -250.50

Purchase of Stock in Trade -234.30

Profit from Operations before Other Income, Interest and Exceptional Items 1,103.40

Other Income 279.10

Profit before Interest and Exceptional Items 1,382.50

Interest -10.30

Finance Costs -10.30

Profit after Interest but before Exceptional Items 1,372.20

Exceptional Items 0.00

Profit (+)/ Loss (-) from Ordinary Activities before Tax 1,372.20

Tax -426.70

Net Profit (+)/ Loss (-) from Ordinary Activities after Tax 945.50

Extraordinary Items 0.00

Net Profit 945.50

Equity Capital 434.10

Face Value (in Rs) 10.00

Reserves 3,740.10

EPS before Extraordinary items (in Rs)

EPS after Extraordinary items (in Rs)

Basic EPS after Extraordinary items 21.79

Diluted EPS after Extraordinary items 21.55

Number of Public Shareholding 2,25,50,970.00

Percentage of Public Shareholding 51.95

Promoters and Promoter Group Shareholding

Pledged / Encumbered

Number of Shares 0.00

Percentage of Shares (as a % of the total shareholding of promoter and promoter

group) 0.00

Percentage of Shares (as a% of the total share capital of the company) 0.00

Non-encumbered

Number of Shares 2,08,58,804.00

Percentage of Shares (as a% of the total shareholding of promoter & prom

group) 100.00

Percentage of Shares (as a % of the total share capital of the company) 48.05

Notes

Consistent All round Grouth

Key Milestone

Consolidate number for Q4

Consolidate Performance FY 2011

Geographical Speared of revenue

Service Contribution to revenue

M&R industry overview among top spenders in IT

Sub Vertical Specific Strategy

Service Specific strategy

Technology specific strategy

Sub vertical specific strategy

Service specific strategy

Technology Specific strategy

Ratios

current ratio is also called as working capital as well as bankers ratio it is given as current assets divided

by current liabilities.

This ratio indicates two information

• Working capital position

• Short term solvency position

1. This ratio shows capacity of the company to pay its current liabilities

2. The standard ratio is 2;1 which indicates that for every 1 rupee liability there should be 2

rupees of current assets

3. If the ratio is low it indicates inadequate working capital and unsatisfactory short term

solvency position .

4. If the ratio is very high it indicates inefficient utilisation of shareholders funds

Debt Equity ratio it is given by debt divided by equity.

• Debt =borrowed funds

• Equity=proprietors funds

1. this ratios shows relationship between own funds and borrowed funds

2. a standard ratio is 2:1 which indicates that for every one rupees of own funds 2 rupees can

be borrowed

3. if the ratio is very high it indicates excessive borrowings and repayment problems in the

future

4. if the ratio is very low it indicates under utilisation of borrowings capacity

0

0.5

1

1.5

2

2.5

2008 2009 2010 2011 2012

current ratios

Debtors Turnover Ratio: this ratios means no of times the debtors are turned overi.e goods sold and

money collected from debtors. A higher ratio indicates quick sales and quick collection from the debtors.

0

0.1

0.2

0.3

0.4

0.5

0.6

2008 2009 2010 2011 2012

debt equity ratios

0

1

2

3

4

5

6

2008 2009 2010 2011 2012

debtors turnover ratios

Earning per Share(EPS) : Net profit after tax-preference dividend/no of equity shares. This means

earning made during the year on each equity shares

Net Profit Ratio : It is given by net profit divided by sales.

• This ratio shows relationship between net profit and net sales.

• This ratios shows profitability of the business.

• A higher ratio indicates higher profit and vice versa.

0

5

10

15

20

25

30

35

40

45

2008 2009 2010 2011 2012

EARNING PER SHARE

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

2008 2009 2010 2011 2012

NET PROFIT RATIO

Awards Zensar Technologies felicitated with Emerging Business Applications Award for 2009 at the Oracle UK

Partner Awards in London.

Third consecutive CNBC award for Outstanding exporter of the year 2009 in IT, ITES & Electronics.[3][4][5]

Oracle UK Partner Award Zensar felicitated by Special Jury Commendation Award by the then President of India, Dr. A.P.J. Kalam

for outstanding commitment and contribution to Nation Building through CSR efforts.

Zensar named as the Trailblazer of the Year 2006 by the NHRD for Best HR Practices.

Zensar awarded the ‘Corporate Governance Business for Social Responsibility Award’ for 2006. Acquisitions and Joint Ventures

Acquired ThoughDigital for US $ 24.9 million in 2007.

Joint venture with a Tokyo Based EZA to form Zensar Advanced Technologies.

Acquired Hyderabad based OBT global in 2005.

Acquired Akibia Inc. worth $100 Million.

Partnerships and Alliances Zensar and SOA Software announce Global Strategic Partnership in 2007

IBM - Zensar has entered into a partnership with IBM Partner World to leverage the growing E-business

market

Zensar Technologies is a Microsoft Gold Certified Partner

Zensar is a channel and service partner of SAP

Zensar technologies is a worldwide recognized Oracle partner

The Markets : CHina, India, Middle East, SAARC countries

Market Dynamics - Large and young populations and vast resource bases

- Transitional societies making drastic economic and political reforms

- Among the world’s fastest growing economies

- Transition from dependency to global interdependency with two way trade

and capital flows

Opportunities - New and growing domestic markets

- New sources of talent

- High IT Adoption and investment in Infrastructure

- Strong Govt promotion and support

Expectations – Accelerate growth of IM business in US and Europe

– Expand presence in current accounts

– Implement seamless multi-shore delivery model

– Streamline process to respond to larger opportunities

Expectations

• Accelerate growth of IM business outside of US and Europe

• Implement go-to-market strategy in core geographies

• Gain acceptance in market as Global IM solutions provider

Develop Solutions for Target Vertical markets

• Develop IM solutions to complement Zensar Vertical strategy

• Build domain expertise to market & deliver these solutions

• Team with Vertical Heads to integrate the IM solutions into there

Messaging

Evolving as end to end IT infrastructure

outsourcing company

–Capable to offer a single SLA to CIO for

the entire DC operation

• Which includes Networks, Systems, Applications,

Compliance, and Risk

Strategies for CHIMPS

Application Management

Key us Metrics

Strengths Key Focus Metrics • Employee Engagement

• Retention of critical talent

• Employee satisfaction

Broad basing the organization and scaling up people capabilities • Building and retaining leadership

• Strengthening the quality of middle managers

• Enhancing Employee Engagement

Weakness Company Focus • Customer Focused Business Processes

• Best in Class Performance Measures

• Right People for the Right Roles

• Highest Quality at Lowest Prices

• Best in Class Information Technology

• Knowledge Management as a differentiator!

Threats Top 5 Competitor:

Cognizant

Tata Constancy Services

IBM (Daksh)

iGATE Patni

Infosys

Using Strengths Steps to get explore opportunities Steps Taken for transformation

Reduce Cost

intranet application for employee self-service

on-line sales-force support

Improve Processes

on-line customer support

e-procurement

Redefine Processes

vendor-managed inventory

strategic sourcing initiatives

sell product through e-channels

Redefine Business Models

sell (rather than give away) service

outsource production

Create Markets

become a market maker/e-channel / infomediary

leverage intangible assets

Bibliography Books : Management Accounts: Anapure

Website:

Zensar.com

http://www.zensar.com/about-us/corporate-profile

http://www.zensar.com/zensar-media/inthenews/399-zensar-profit

rpggroup.com

http://www.rpggroup.com/

Wikipedia.org

http://en.wikipedia.org/wiki/Zensar_Technologies

thehindubusinessline.in

http://www.thehindubusinessline.in/2005/12/14/stories/2005121402250400.htm

http://www.thehindubusinessline.com/todays-paper/tp-info-tech/article1048574.ece?ref=archive

siliconindia.com

http://www.siliconindia.com/shownews/Zensar_acquires_OBT_Global-nid-30229-cid-2.html

bseindia.com

http://beta.bseindia.com/bseplus/StockReach/StockQuote/Equity/Zensar%20Technologies%20Ltd/ZENSAR

/504067/ITConsultingSoftware

indiatimes.com

http://timesofindia.indiatimes.com/tech/techhome/5880659.cms

equitybulls.com/

http://www.equitybulls.com/admin/news2006/news_det.asp?id=83876

icicidirect.com

cnbc.com