My fortnightly column, A Dose of It that discusses the issues around Green Hospitals Kapil Khandelwal QuoteUnquote with KK www.kapilkhandelwal.com

1. c m y k c m y k
Bengaluru ●● Monday ●● 11 January 2010
Suppliers for
Apple’s tablet
are shipping
touchscreen
panels.
13
Technomics
Microsoft has
appealed a
Word patent
case once
again.
Google said the
next version of
Nexus One phone
will be for
enterprise users.
DDCC
Green the clinic
Kapil Khandelwal
T
he buzz around cli-
mate change is a
never ending one.
The hospital sector has
been known to be one of
the top waste-producing
industries. Conservative-
ly, hospitals spend
around five kilos of waste
per patient per day of
which around one-fourth
is infectious waste. Over
and above, on a per
square foot of building
space, hospitals consume
almost twice the energy,
water, and natural
resources-based products
such as paper than other
industries.
How can an industry
that heals the world leave
behind such a legacy for
future generations?
The business case for
‘green’ savings, led by
the adoption of green
technologies, has been
well established. These
savings could be substan-
tial — to the extent of 5
to 6 per cent of costs —
in well established eco-
friendly hospitals.
While the green initia-
tives for healthcare and
its information technolo-
gy enablers have been
around for the last few
years, hospitals’ track
record for adopting green
standards such as
LEEDs, Green Guide for
Healthcare and our local
Indian norms set by
Green Rating for Inte-
grated Habitat Assess-
ment has been poor. We
hardly have a handful of
hospitals which have
achieved the green rat-
ings.
Many custom-made, off
the shelf solutions that
promise to make hospi-
tals paperless, smart, and
electronic have existed
and have been imple-
mented. However, they
failed to deliver as they
did not take into consid-
eration the physical con-
figuration of a hospital.
Second, a large number
of ICT implementations
fail to meet their green
objectives as their bene-
fits have not been sold to
the doctors and clini-
cians. There is no ele-
ment of green in their
professional orientation.
We need a mass change
management that
involves all the stake-
holders. While a lot
needs to be done to clean
up the hospitals and make
them green, activists and
green accreditation agen-
cies need to start collabo-
rating with hospitals,
medical, nursing, and
engineering colleges to
usher in a healthy mass
movement of the future.
Kapil Khandelwal is a leading healthcare and
ICT expert. Kapil@KapilKhandelwal.com
A dose
of IT
A dose
of IT Q3 results: Analysts
predict strong IT show
DC CORRESPONDENT
BENGALURU
Jan. 10: It should be an encour-
aging third quarter report card
from India’s export-led IT sec-
tor, beginning with stock mar-
ket darling Infosys that will
announce results on January
12, for the first time from its
university-like training campus
in Mysore.
Almost all analysts expect top
tier IT firms to clock Dollar
revenue growth compared to
the second quarter — a majori-
ty of them pegging it between 3
and 5 per cent on the back of an
improving global economy.
There has been a pick up in IT
spending, particularly from the
Indian IT industry’s bread and
butter segment — banking,
financial services and insurance
(BFSI), which contributes to
about 40 per cent to the sector’s
revenues.
Mergers in the sector have
given rise to projects around
rationalisation of systems.
Firms have noted opportunities
in security trading, core bank
transformation, risk manage-
ment, regulatory compliance
and internal audit. Opportuni-
ties, however, may have dimin-
ished in retail banking.
“Top tier IT companies are
likely to lead recovery, mid and
small companies will catch up
after a time lag,” a report from
Khandwala Securities notes.
The report says there is an
increase in management confi-
dence about volume growth,
largely because of an upsurge
in deal closure and deal ramp-
ups, growth in BFSI after turbu-
lent times, outsourcing gaining
traction in Europe, strong
growth in emerging markets,
and gains because of vendor
consolidation. Khandwala
Securities anticipates latent
demand and unspent budgeted
amount to lead to strong growth
in fiscal year 2011.
Citigroup and Morgan Stan-
ley expects India’s third largest
IT services firm Wipro to report
the strongest quarter among top
tier firms — a growth of 4.5 per
cent compared to the second
quarter, at the higher end of its
guidance.
TCS, on the other hand, may
report muted results. Morgan
Stanley anticipates TCS rev-
enue growth to decelerate to
about 3 per cent.
Citi says investors will be
looking forward to the direction
of IT budgets, timing of the
budgets, revival in discre-
tionary spends — most compa-
nies are hoping for some revival
— and pricing.
Expectations are largely of a
flattish year over year pricing
growth.
While it could be good news
on the top line front, there are
multiple headwinds on the
profitability side — compensa-
tion increase and the Rupee’s
movement against the Dollar,
mostly.
Analysts from Batlivala &
Karani expects EBITDA mar-
gins to decline 50-150 basis
points for most companies due
to Rupee appreciation, salary
hikes, and a decline in utilisa-
tion with freshers’ joining the
IT workforce in the third quar-
ter.
Rupee appreciated by about 4
per cent against the Dollar dur-
ing the quarter.
UBS says it remains positive
on volume recovery but is cau-
tious on the margin outlook; the
firm believes EPS growth will
lag behind revenue growth.
Jan. 10: Analysts expect
Infosys to beat the upper
end of its third quarter Dol-
lar revenue guidance but
see operating margins
contracting because of
salary hikes, the impact of
Rupee appreciation, and
higher selling and admin-
istration expenses.
However, some market
watchers also expect the
IT bellwether firm to revise
its full year earnings per
share guidance.
At the end of the second
quarter, India’s second
largest IT services firm
guided third quarter rev-
enues to be in the range of
$ 1,155 million and $ 1,165
million, or a growth
between 0.3 per cent and
1 per cent.
Considering the
improvements in the
demand environment, that
will be easy to beat, ana-
lysts feel.
Batlivala & Karani
expects Infosys to grow
4.1 per cent compared to
the second quarter to
$1,201 million and revise
its FY10 EPS guidance
upwards to Rs 103-104
from Rs 99.6-100 earlier.
Citigroup pegs 3.5 per
cent revenue growth and
160 basis points decline in
margins, primarily due to
wage hikes. UBS expects
a margin impact of 200
basis points because of
the hikes.
Infosys had announced
compensation increase of
8 per cent in India and 2
per cent abroad, saying it
was a reflection of stability
and confidence — clients
were seeing better stability
and the fear factor was
down dramatically.
Wage hikes to mute
Infosys margins
Revenues
Margins
Seen climbing 3 to 5
per cent compared to
the second
quarter.
Seen declining
50-150 basis points.
key numbers