New Delhi, July 5: Buoyed by a private placement of equity shares at a premium of Rs 70, Mumbai-based Orient Information Technology Ltd has shot into the limelight on the bourses. In the past 10 trading, the stock has zoomed from Rs 58.10 to Rs 90. Volumes, too, saw a spurt as in the last five trading sessions, the counter has witnessed an average volume of 60,000 shares as against a daily average of 10,000 shares. Orient Information is going in for a private placement of 25 lakh shares at a price of Rs 80 per share. The mandate for the issue has been given to SSKI Ltd. Proceeds from the issue of capital will be utilised for expanding infrastructure locally and marketing overseas. Post issue, the paid up capital will rise to Rs 10 crore as against present capital of Rs 7.5 crore.During fiscal 1998-99, the company's equity increased from Rs 4 crore to Rs 7.5 crore thanks to the preferential issue to close associates of the promoters at a premium of Rs 10.50. The funds raised were used by the company toexpand its business in the US, Europe and UK market. Earlier, the company board had decided to increase its authorised capital to Rs 15 crore from Rs 10 crore as they wanted to offer 30 per cent equity stake to foreign institutional investors (FIIs) on a preferential basis. According to marketmen, the company was offering shares at a price of Rs 145-150, which FIIs had turned down. At present, the promoters hold 60 per cent in the company and public hold 40 per cent. Two FIIs hold around 6 lakh shares of the company. The company specialises in contract services, offshore development, product marketing, distribution and support, training and solution integration. The major portion of the revenue comes from manpower sourcing and the rest from product selling, software development and ERP. To be precise, the company is catering to the lower end of the software development market.
The company is opening an office in Bangalore with the intention of diversifying its exports to Europe and the Far East for which ithas already set up marketing offices in New York and central London. In order to strengthen its back offices and its branch networks in India, the company plans to open a new office in Pune to meet increased business volumes in terms of resources requirements.
The company has tied up with global leaders like IBM Global Services for software and IT services, which covers all their clients across the globe. It has a similar tie up with UNISYS. The company also provides professional services to Oracle Corporation's clients in the Middle East. The company's clientele include UNISYS, Sun Micro System, British Bank, Novell, IBM, Emirates Airlines, Siemens, Reliance and ACC. Orient is currently working on modalities and potential of software development on Euro-currency conversion jobs, which are expected to fetch higher revenue than Y2K. The company has recently bagged a software development order worth Rs 4 crore from a UK-based firm.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.
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