Infosys Technologies

The company is likely to report a 85-90 per cent growth in topline for the first-half on the back of higher contribution from productised services and products as well as an upsurge in revenues from e-commerce. As the company is moving up the value-chain, margins are expected to improve. High margin product sales and offshore services should help Infosys maintain a growth rate of over 100 per cent in bottomline for the rest of the year, too. In the first-quarter, the company brought down its exposure to the Y2K business to 15 per cent. Infosys has also succeeded in increasing its geographical reach - its revenues from Europe have gone up by 14 per cent. In a major venture to tap the high potential e-commerce market, Infosys has tied-up with CyberSource Corporation (which is a leading developer and provider of real time internet commerce services - like transaction processing services for payment, tax calculation, risk management, fulfillment management, and distribution control). Revenue from e-commerce islikely to increase to 20 per cent (from 4 per cent in FY99) in the next 2-3 years.

Satyam Computers

The stock has recently crossed the Rs 1100-mark (ex-bonus). It is trading at a PE of 79 times. The company is likely to report a profit of Rs 52 crore for the first-half of fiscal 2000. The company has adopted the right sourcing model, which sould give a boost to its long-term growth plans. The company is increasingly moving its focus from projects to a right sourcing solution orientation - supported, on the one hand, by growing competencies in select sectors and technologies and, on the other, by offsite development center capabilities. The addition of 30 new customers in the first-quarter is evidence that the new sales model is finding growing acceptance with customers. The focus on select sectors will also help the company build existing strengths in telecom, insurance, manufacturing and finance/banking industries. These four sectors together generate 75 per cent of the revenue. Fixed bid projects now constitute 32 per cent of Satyam's business.

Wipro

Wipro Ltd is expected to double its software sales in two years and this growth is likely to come on the back of e-commerce. The company enjoys a competitive edge in business-to-business services and this should help the company tap e-commerce business. Wipro offers a range of services, including year 2000 solutions, euro currency conversion, supply-chain management and software services for telecommunication and healthcare industries. In the first-quarter, the company reported a net profit of Rs 48 crore while software and services sales stood at Rs 200.8 crore and systems and services accounted for another Rs 131.6 crore. For the second quarter, the company is likely to report a net profit of Rs 94 crore. The stock has recently been split to have a face value of Rs 2 instead of Rs 10. This is also likely to improve liquidity at the counter. After split the stock is now trading at Rs 1331 at PE of 177.4 times. Wipro commands a premium valuation to the overall industry PE ratio due to its superior businessmix, excellent long term client relationships, clear growth driven strategy, transparent and conservative accounting policies coupled with professional depth and quality management.

NIIT

NIIT enjoys a balanced mix of software and IT education, strong franchisee in education business and a well-diversified software services and systems integration business. The company is expected to report a net profit of Rs 143 crore for the full-year ending September 30, 1999. The scrip currently enjoys a discounting of 86.7. But with the growth in the software industry coupled with the increasing level of computerisation in user industries, which provides a favourable platform for NIIT in all its business lines, this is justified.

Pentafour Software

Thanks to overseas exports, Pentafour Software is expected to post a net profit of Rs 74 crore for the first-half. A strong order book position and a presence in the high-end market for multimedia and business software gives the company the potential for future growth. The stock is currently trading at Rs 645 enjoying a low PE of 17.43 times on the expected first-half earnings. The company is currently working on the 3D Hollywood animation film `Sandman' and has successfully completed projects like `Alibaba and Forty Theives' among others.

Digital Equipment

Bangalore-based Digital Equipment is expected to clock a turnover of Rs 80 crore and a net profit of Rs 18 crore in the first-quarter. The scrip is currently quoting at Rs 800.25 and enjoys a PE 48.2. The PE is on the higher side. But there is tremendous scope for appreciation (given Digital's shift in business profile as well as Compaq's pedigree as customer, supporter and investor).

HCL Infosystems

The company is likely to report a net profit of Rs 16-18 crore in the first quarter of fiscal 2000 -- a 33-50 per cent growth in bottomline. The growth will be fueled by company's decisive shift towards software and higher PC sales thanks to Y2K fears. HCL proposes to increase its e-commerce business and, at the same time, continue witgh its accent on high-end enterprise system sales, systems integration and services segments.

As the software services business is likely to underpin its long-term business outlook, it appears to have chosen electronic commerce a growth area. This includes setting up infrastructure for Internet Service Providers, solutions for cyber cafes, information kiosks, Net-on-TV, etc. All this along with the company's proposed listing abroad, should arouse interest in the stock.