The Hindu Business Line : Sasken to hire more; IPO in the offing

SASKEN Communication Technologies plans to hire some 1,000 people in financial year 2005-06 as it expects a surge in order flows during the year, according to the Chairman and CEO, Mr Rajiv Mody.

The company, which develops software solutions for the telecom market, currently has some 2,300 people, of whom about 300 are in its products business and the rest in services.

Sasken is also planning to tap the capital market in 2005-06, Mr Mody said even while declining to comment on the size of the issue. Mr Mody said the timing of the issue was yet to be finalised, but it would happen over the next few quarters. However, market sources said the company is expected to come out with Rs 120-crore initial public offer soon.

"We are planning to issue fresh equity through the proposed IPO," Mr Mody said, adding all existing investors including Intel Capital, would not dilute their holding through the issue. The company plans to invest about $10 million in expanding its operations in FY06. Sasken currently has a development presence in Bangalore and Pune, and is looking at other cities such as Hyderabad, Delhi for possible expansion, he added.

Sasken, which clocked a growth of about 50 per cent last financial year, expects to sustain its growth momentum in the current fiscal. "We are looking at a growth of 40-50 per cent for the current fiscal," Mr Mody said. The company had clocked revenue of Rs 166 crore and a net profit of Rs 18 crore during 2003-04.

Sasken, which has recovered from the losses that it suffered due to the technology meltdown few years back, is looking at the next phase of growth and plans to invest in infrastructure expansion for its services side of business and development of products, he said. Sasken expects to derive close to 15 per cent of its total revenues from products business this fiscal.

The company is bullish on the domestic and emerging markets, Mr Mody said, adding, "This is where the growth is going to come from and we cannot afford to ignore it." Sasken recently acquired Blue Broadband Technologies and made it into a subsidiary to tap the domestic telecom infrastructure market. "We are looking at supporting our network-oriented customers and would be looking at other opportunities," Mr Mody said. Sasken currently derives less than 5 per cent of its revenues from the domestic market.

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