The turnover for the first half of the financial year has risen by 17.87 per cent to Rs 148.63 crore. The company is in the process of implementing a contract to install an integrated IT package to streamline the freight operations of the Indian Railways and a fingerprint analysis and criminal tracing system for the Mauritius police force. It has also entered into a tie-up with Frontec AMT of Sweden to provide Electronic Data Interchange (EDI) and Electronic Commerce services and solutions. CMC thus is geared to provide solutions for message-based integration.

The foray into these higher margin businesses is still to be reflected in theoperating margins, which have continued to remain stagnant . But it has to be noted that operating profits have risen by 14 per cent to Rs 8.8 crore. The company is now providing information-technology solutions in key areas like railways, fingerprinting, tracking systems and enterprise resource planning (ERP).

CMC is slated for a major expansion plan over the next four years entailing a capex of Rs 125 crore. It is confident of providing 70 per cent of the same through internal accruals. This should be possible as the company has already set up subsidiaries in the US and North America. Furthermore, it is slated to service the European and East Asian markets. All this should ensure a sizable increase in the share of earnings from international operations in the future.

ICICI last year had submitted a detailed report on funding options for CMC to embark on its future growth. The report has recommended an additional share capital of Rs 20 crore, debt of Rs 55 crore and internal resource generation of Rs 50crore. With the government holding 84 per cent stake, CMC, at present, has an authorised capital of Rs 35 crore, while the paid up capital has remained at Rs 15.5 crore from 1991 onwards. Reports say that the company is slated to increase its equity base and is awaiting government approval for the same. CMC's plans to formulate a stock-option scheme for its employees has been held up owing to government indecision on equity divestment. This is crucial for CMC's future, as retaining high-quality manpower is a prerequisite for attaining its growth plans.

Cybertech Systems & Software: Cybertech Systems and Software Limited (CSSL) has benefited the most from the fast-growing demand for enterprise resource planning packages. This is because the demand for SAP professionals commensurately increased, thereby translating into higher demand for CSSL's training facilities. The company has registered an impressive growth in revenues owing to the same. CSSL mainly concentrates on providing SAP professionals tomajor accounting firms like Arthur Andersen and Delloite Touche, the leading SAP implementers globally. In order to exploit the enormous opportunity in ERP, CSSL has invested over Rs 3.5 crore in hardware and SAP R/3 software.

The unaudited financial results for the first half ended September 30, 1998, indicate that income from operations has risen by 41.63 per cent to Rs 7.79 crore. Considering the fact that margins in software training on the popular ERP packages like BaaN and SAP are higher compared to other areas has resulted in operating profits increasing by 48.57 per cent to Rs 5.2 crore from Rs 3.5 crore. Commensurately, operating margins have increased to 66.75 per cent from 63.63 per cent. Moreover, CSSL garners more than $10,000 from its American clients for training a single SAP professional. All this has led to net profits rising by 57.89 per cent to Rs 5.7 crore.

Cybertech International Corporation, USA, (CIC) has recently invested $13.8 million in acquiring a majority stake in CSSL. CSSLhas allotted 52.56 lakh equity shares at a premium of Rs 100 via a preferential allotment subject to a five-year lock-in period. CIC's stake in CCSL is currently at 51 per cent.Promoters' stake in CSSL have risen to around 80 per cent. Currently the stock is hovering around the Rs 180 mark.

CIC has started sourcing resources from CSSL in off-shore SAP implementation.CIC has developed a strong association with Oracle, Microsoft, Novell and Unisys, resulting in better reach for CSSL products in global markets. To tap the enormous potential in Y2K and euro conversion areas, CSSL has recently set up a project in Thane. It is obvious that CSSL's future profitability lies in its ability to reduce its dependence on SAP alone and increase its exposure to other buoyant areas.