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Ramco Systems Analyst meet notes - Views on News from Equitymaster
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  • Jun 22, 2000

    Ramco Systems Analyst meet notes

    Ramco Systems Ltd. (RSL), is the erstwhile systems division of Ramco Industries. The company is no longer just an ERP company. It also provides software consulting projects & services centered on e-business solutions.

    RSL has four main focus areas:

    • Ramco e-applications which provides enterprise solutions.
    • Ramco Virtual Works.
    • Consulting in the areas of e-commerce, system integration and application development.
    • Networking and security.

    RSL has around 2,400-person years experience in enterprise application development (EAD) and over 1,000 man years experience in implementation. The company aims to be a leading provider of next generation enterprise applications using advanced technologies and right solution architecture.

    It has a unique business model classified into direct-to-customer and complementary model. Under direct-to-customer model, the company has custom built products in the area of e-commerce and special projects. The complementary model enables a select set of customers to extend scope of their offerings to their customers, augment their delivery capacity and create new products using OLTP (Online Transaction Processing). The challenge for the company lies in transformation of business systems by enabling business transactions on web. Also the timely delivery with quality plays an important role in case of ERP product. Ramco is a leader in the market since it has the ability to deliver complex OLTP systems rapidly by predicting and controlling time, effort, quality and cost.

    In the current year, RSL has introduced its most revolutionary application Ramco Virtual Works (RVW) which could become one of the most radical innovations making it a total IT Solutions company. The product operates on a business framework, which is different from the technology framework. With RVW, any changes in technology or business model require only minor levels of new programming. RVW acts as a facilitator to develop the product faster or it can be called as an ERP for ERP. It also reduces the dependence on software developers because of its flexibility. While the concept is not new, however, RSL claims that its success at having developed such a framework is the first. Worldwide OLTP market contributes around 74% to the total software market. This offers a good growth opportunity to the company.

    Till today, RSL has completed 550 installations and has even acquired FORTUNE 500 companies as its customers. Having built such a large customer base spanning different sectors and executing most complicated projects, RSL has developed good amount of expertise. In future it will be able to leverage on its strength and would be able to get more repeat business from its existing network of clientele.

    In the FY00, RSL has posted revenue of Rs 1.1 bn, which it expects to grow by 70-80% in the next year with good profit margins. For the first time the company has posted a profit of Rs 9 m in FY00. However, as regards its consolidated global operations, there is still a marginal loss of $7.5 m. With improved financials and unleveraged position, RSL would be able to record handsome profits in the current year, on a consolidated basis.



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