Digital eyes Rs 1200 cr rev in ‘05

BANGALORE: Digital Globalsoft expects its revenues to cross Rs 1,200 crore in fiscal year ending March 31, 2005, the first full year of combined operations after its merger with HPS ISO, compared to revenues of Rs 420 crore posted in 2002-03. Revenues are likely to cross Rs 2,050 crore in 2006-07, an increase of nearly five times. 'Revenue growth for FY04 is expected to outperform the sector, as the benefits of the merger will accrue on an immediate basis,' said the company, in a statement to the media.

Digital GlobalSoft, on June 7, signed an agreement with HP, its parent company and majority shareholder, to combine operations with HP Services India Software Organization, establishing a significant services company with HP as a key investor, customer and supporter. The company has announced its revised operating outlook follows the merger that aims to establish Digital as a consolidated focal point for HP Services` global delivery capabilities in India and as a preferred vendor.

Digital is likely to report higher EPS from FY04 onwards, compared to Rs 31.90 reported in FY03. Further, the transaction is expected to be EPS accretive in FY05, the first full year of combined operations.

The employee strength of the company is likely to increase over four times to more than 10,000 people by March 31, 2007 from 2,490 people as on March 31, 2003, including the employees of HPS ISO.

Commenting on the outlook, Rene Schuster, vice-president and general manager worldwide, consulting and integration, HP Services, said, 'We expect this initiative to not only result in the creation of Digital as a principal vehicle for our global delivery capabilities in India, but also to result in increased value creation for all stakeholders of the company.'

'As a preferred vendor from India, we have made business commitments to Digital that will enable us leverage its capabilities more intensively going forward,' Schuster said.

Som Mittal, president and CEO, Digital, said, 'The initiative to establish Digital as HP Services preferred vendor in India provides us numerous growth opportunities and business commitments, which are not available without the complete implementation of this plan. We are confident that given our renewed position we will be able to deliver rapid operating and financial progress, outperforming the sector across key parameters over the next few years, which we believe is very encouraging given the current operating environment'