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Case Study of Zensar Technologies,Pune (RPG Group) for Managerial economics

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Case Study of Zensar Technologies,Pune (RPG Group) for …

Case Study of Zensar Technologies,Pune (RPG Group) for
Managerial economics/ MBA Part I
By
Renzil D’cruz
About.me/renzilde
Drop me message @ renzilde@gmail.com

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  • 1. Case Study: Zensar Technologies For Managerial Economics By Rashmika Kangrana Renzil D’cruz Rishabh Mehata Rohit Jumale Rohit Tiwari Under Guidance of Dr. P.A.Johnson
  • 2. Index
  • 3. Zensar Technologies Our Mission Leveraging technology and processes to help customers attain their goals. Our Vision Transformation partners to global corporations. About Zensar Zensar Technologies is a global information technology services and business process outsourcer headquartered in Pune, India. It is a software wing of RPG Group, and offers a range of integrated information technology (IT) and BPO products and services to Fortune 500 clients. Zensar has a marketing presence in the US, Europe, Asia Pacific and Australia. The company has operations and a customer base spanning across 18 countries including software development centres at Pune and Hyderabad in India and Gdansk in Poland. Zensar service areas include Application Support and Development, Application portfolio management, Testing, Enterprise Collaboration and Content Management, Enterprise Application Integration, Business Intelligence & Data Warehousing. Zensar's core competency is Application Modernization, using Zensar's SBP framework. Zensar is the world's first enterprise-wide SEI CMM Level 5 Company with activity that spans across Utilities, Retail and Distribution, Banking, Financial Services and Insurance, Manufacturing and Telecommunications. Zensar Technologies (Parent Company RPG Group) provides Services such as Application Portfolio Management, Enterprise Application Service, Innovative Technology Services, Business process outsourcing and optimisation, First Time Outsourcing and it is 3,000 crore (US$567 million) company having more than 7000 employees dated April 2012.
  • 4. Achievement Highlights Zensar profit net up by 35 % at Rs 20.22 cr - Leading software solution company and BPO services provider Zensar Technologies Ltd has reported a good year-on-year profit growth for the quarter ended December 31. It posted a y-o-y net profit of Rs 20.22 crore as against Rs 15.02 crore posted during the same period of the previous year reflecting a growth of 34.6 per cent. Key People Dr.Ganesh Natarajan, Vice Chairman & CEO,Zensar Technologies. Vivek Gupta, Chief Executive, IBS and Executive Chairman, Akibia Nitin Parab, Chief Executive and Global Head, Enterprise Transformation Services (ETS) Harish Gala, Global Head, Enterprise Applications (Oracle and SAP) Yogesh Patgaonkar, Global Head, Human Resources Sanjay Marathe, Head, Strategic Services Unit and CTO Ajay Bhandari, Chief Corporate Development Officer S. Balasubramaniam, CFO Scrip ID : ZENSAR Scrip Code : 504067 (BSE) Industry : IT Consulting & Software Company :ZENSAR TECHNOLOGIES LTD. 504067 Period: Year 2008 to Year 2012 (All Prices in ) Year Open High Low Close No. of Shares No. of Trades Total Turnover Deliverable Quantity % Deli. Qty to Traded Qty * Spread H-L C-O 2008 192.00 203.70 71.00 78.35 32,07,206 50,998 43,42,47,053 19,43,515 60.60 132.70 - 113.65 2009 81.00 351.00 64.65 324.10 55,35,846 83,647 1,16,74,84,788 31,09,765 56.18 286.35 243.10 2010 326.00 365.90 151.15 166.65 64,31,592 1,40,373 1,84,34,12,495 25,49,743 39.64 214.75 - 159.35 2011 167.00 193.30 113.15 143.30 18,94,760 60,699 31,00,39,077 9,79,811 51.71 80.15 -23.70 2012 143.25 302.45 133.55 296.85 48,88,293 1,63,593 1,07,25,96,009 16,48,760 33.73 168.90 153.60 * Spread H-L : High-Low C-O : Close-Open
  • 5. Price Movement Index Comparison Performance Chart Ownership Pattern
  • 6. Annual Trends (in Cr.) 2011 - 12 2010 - 11 2009 - 10 2008 - 09 2007 - 08 Income Statement(View in (Million)) Revenue 712.75 584.52 502.32 428.00 335.87 Other Income 27.91 7.31 2.91 2.62 11.91 Total Income 740.66 591.83 505.23 430.62 347.78 Expenditure -577.36 -478.85 -393.18 -341.11 -282.36 Interest -1.03 -0.86 -0.55 -0.54 -1.12 PBDT 162.27 112.12 111.50 88.97 64.30 depreciation -25.05 -25.88 -24.92 -22.29 -15.64 PBT 137.22 86.24 86.58 66.68 48.66 Tax -42.67 2.24 -2.43 -6.21 -3.29 Net Profit 94.55 88.48 84.15 60.47 45.37 Equity 43.41 43.30 21.58 23.97 23.96 Reserves 374.01 341.27 272.34 230.46 181.05 EPS 21.79 20.47 35.77 25.23 18.95 CEPS 27.55 26.41 50.54 34.53 -- OPM % 22.91 19.33 22.31 20.91 19.48 NPM % 13.27 15.14 16.75 14.13 13.51 Detailed Detailed Detailed Detailed Detailed Consolidated Consolidated Consolidated Consolidated Consolidated Type Audited Date Begin 01-Apr-11 Date End 31-Mar-12 Description Amount (Rs. million) Net Sales / Income from Operations 7,127.50 Net Sales / Income from Operations 7,001.70 Other Operating Income 125.80 Expenditure -6,024.10 Other Expenditure -1,262.00 Employee Benefit Expenses -4,277.30 Depreciation & amortization expense -250.50 Purchase of Stock in Trade -234.30 Profit from Operations before Other Income, Interest and Exceptional Items 1,103.40 Other Income 279.10 Profit before Interest and Exceptional Items 1,382.50
  • 7. Interest -10.30 Finance Costs -10.30 Profit after Interest but before Exceptional Items 1,372.20 Exceptional Items 0.00 Profit (+)/ Loss (-) from Ordinary Activities before Tax 1,372.20 Tax -426.70 Net Profit (+)/ Loss (-) from Ordinary Activities after Tax 945.50 Extraordinary Items 0.00 Net Profit 945.50 Equity Capital 434.10 Face Value (in Rs) 10.00 Reserves 3,740.10 EPS before Extraordinary items (in Rs) EPS after Extraordinary items (in Rs) Basic EPS after Extraordinary items 21.79 Diluted EPS after Extraordinary items 21.55 Number of Public Shareholding 2,25,50,970.00 Percentage of Public Shareholding 51.95 Promoters and Promoter Group Shareholding Pledged / Encumbered Number of Shares 0.00 Percentage of Shares (as a % of the total shareholding of promoter and promoter group) 0.00 Percentage of Shares (as a% of the total share capital of the company) 0.00 Non-encumbered Number of Shares 2,08,58,804.00 Percentage of Shares (as a% of the total shareholding of promoter & prom group) 100.00 Percentage of Shares (as a % of the total share capital of the company) 48.05 Notes
  • 8. Consistent All round Grouth
  • 9. Key Milestone Consolidate number for Q4
  • 10. Consolidate Performance FY 2011 Geographical Speared of revenue Service Contribution to revenue
  • 11. M&R industry overview among top spenders in IT
  • 12. Sub Vertical Specific Strategy Service Specific strategy
  • 13. Technology specific strategy
  • 14. Sub vertical specific strategy
  • 15. Service specific strategy Technology Specific strategy
  • 16. Ratios current ratio is also called as working capital as well as bankers ratio it is given as current assets divided by current liabilities. This ratio indicates two information • Working capital position • Short term solvency position 1. This ratio shows capacity of the company to pay its current liabilities 2. The standard ratio is 2;1 which indicates that for every 1 rupee liability there should be 2 rupees of current assets 3. If the ratio is low it indicates inadequate working capital and unsatisfactory short term solvency position . 4. If the ratio is very high it indicates inefficient utilisation of shareholders funds Debt Equity ratio it is given by debt divided by equity. • Debt =borrowed funds • Equity=proprietors funds 1. this ratios shows relationship between own funds and borrowed funds 2. a standard ratio is 2:1 which indicates that for every one rupees of own funds 2 rupees can be borrowed 3. if the ratio is very high it indicates excessive borrowings and repayment problems in the future 4. if the ratio is very low it indicates under utilisation of borrowings capacity 0 0.5 1 1.5 2 2.5 2008 2009 2010 2011 2012 current ratios
  • 17. Debtors Turnover Ratio: this ratios means no of times the debtors are turned overi.e goods sold and money collected from debtors. A higher ratio indicates quick sales and quick collection from the debtors. 0 0.1 0.2 0.3 0.4 0.5 0.6 2008 2009 2010 2011 2012 debt equity ratios 0 1 2 3 4 5 6 2008 2009 2010 2011 2012 debtors turnover ratios
  • 18. Earning per Share(EPS) : Net profit after tax-preference dividend/no of equity shares. This means earning made during the year on each equity shares Net Profit Ratio : It is given by net profit divided by sales. • This ratio shows relationship between net profit and net sales. • This ratios shows profitability of the business. • A higher ratio indicates higher profit and vice versa. 0 5 10 15 20 25 30 35 40 45 2008 2009 2010 2011 2012 EARNING PER SHARE 0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 2008 2009 2010 2011 2012 NET PROFIT RATIO
  • 19. Awards Zensar Technologies felicitated with Emerging Business Applications Award for 2009 at the Oracle UK Partner Awards in London. Third consecutive CNBC award for Outstanding exporter of the year 2009 in IT, ITES & Electronics.[3][4][5] Oracle UK Partner Award Zensar felicitated by Special Jury Commendation Award by the then President of India, Dr. A.P.J. Kalam for outstanding commitment and contribution to Nation Building through CSR efforts. Zensar named as the Trailblazer of the Year 2006 by the NHRD for Best HR Practices. Zensar awarded the ‘Corporate Governance Business for Social Responsibility Award’ for 2006. Acquisitions and Joint Ventures Acquired ThoughDigital for US $ 24.9 million in 2007. Joint venture with a Tokyo Based EZA to form Zensar Advanced Technologies. Acquired Hyderabad based OBT global in 2005. Acquired Akibia Inc. worth $100 Million. Partnerships and Alliances Zensar and SOA Software announce Global Strategic Partnership in 2007 IBM - Zensar has entered into a partnership with IBM Partner World to leverage the growing E-business market Zensar Technologies is a Microsoft Gold Certified Partner Zensar is a channel and service partner of SAP Zensar technologies is a worldwide recognized Oracle partner The Markets : CHina, India, Middle East, SAARC countries Market Dynamics - Large and young populations and vast resource bases - Transitional societies making drastic economic and political reforms - Among the world’s fastest growing economies - Transition from dependency to global interdependency with two way trade and capital flows Opportunities - New and growing domestic markets - New sources of talent - High IT Adoption and investment in Infrastructure - Strong Govt promotion and support Expectations – Accelerate growth of IM business in US and Europe – Expand presence in current accounts – Implement seamless multi-shore delivery model – Streamline process to respond to larger opportunities Expectations • Accelerate growth of IM business outside of US and Europe • Implement go-to-market strategy in core geographies • Gain acceptance in market as Global IM solutions provider Develop Solutions for Target Vertical markets • Develop IM solutions to complement Zensar Vertical strategy • Build domain expertise to market & deliver these solutions
  • 20. • Team with Vertical Heads to integrate the IM solutions into there Messaging Evolving as end to end IT infrastructure outsourcing company –Capable to offer a single SLA to CIO for the entire DC operation • Which includes Networks, Systems, Applications, Compliance, and Risk Strategies for CHIMPS Application Management
  • 21. Key us Metrics
  • 22. Strengths Key Focus Metrics • Employee Engagement • Retention of critical talent • Employee satisfaction Broad basing the organization and scaling up people capabilities • Building and retaining leadership • Strengthening the quality of middle managers • Enhancing Employee Engagement Weakness Company Focus • Customer Focused Business Processes • Best in Class Performance Measures • Right People for the Right Roles • Highest Quality at Lowest Prices • Best in Class Information Technology • Knowledge Management as a differentiator! Threats Top 5 Competitor: Cognizant Tata Constancy Services IBM (Daksh) iGATE Patni Infosys Using Strengths Steps to get explore opportunities Steps Taken for transformation Reduce Cost intranet application for employee self-service on-line sales-force support Improve Processes on-line customer support e-procurement Redefine Processes vendor-managed inventory strategic sourcing initiatives sell product through e-channels Redefine Business Models sell (rather than give away) service outsource production Create Markets become a market maker/e-channel / infomediary leverage intangible assets
  • 23. Bibliography Books : Management Accounts: Anapure Website: Zensar.com http://www.zensar.com/about-us/corporate-profile http://www.zensar.com/zensar-media/inthenews/399-zensar-profit rpggroup.com http://www.rpggroup.com/ Wikipedia.org http://en.wikipedia.org/wiki/Zensar_Technologies thehindubusinessline.in http://www.thehindubusinessline.in/2005/12/14/stories/2005121402250400.htm http://www.thehindubusinessline.com/todays-paper/tp-info-tech/article1048574.ece?ref=archive siliconindia.com http://www.siliconindia.com/shownews/Zensar_acquires_OBT_Global-nid-30229-cid-2.html bseindia.com http://beta.bseindia.com/bseplus/StockReach/StockQuote/Equity/Zensar%20Technologies%20Ltd/ZENSAR /504067/ITConsultingSoftware indiatimes.com http://timesofindia.indiatimes.com/tech/techhome/5880659.cms equitybulls.com/ http://www.equitybulls.com/admin/news2006/news_det.asp?id=83876 icicidirect.com cnbc.com

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