PSI Data a 50.4% subsidiary of Groupe Bull of France has clocked a 144% rise in profits with the improvement in its YoY operating margins in 2QFY00. However if one were to compare the company's performance quarter over quarter, profits increased by 9%. The focus on the development work in the area of Internet based application and technologies helped it to maintain its margins.
Operating Profit (EBDIT)
Operating Profit Margin (%)
Profit before Tax
Profit after Tax/(Loss)
Net profit margin (%)
No. of Shares (eoy) (m)
Diluted number of shares
Diluted Earnings per share*
All the three markets of the company viz. India, Europe and USA showed an excellent growth for the first half this year. Its revenues from Europe contributed 42% to its total revenue. PSI has already established a presence in Europe unlike other software companies which are focused on the US market. The MNC parentage is a great asset on which PSI has leveraged to create niche market in Europe. During the quarter 23% of PSI's business came was from Bull which will increase further to around 30% by the end of the year.
In the current quarter Internet/Java business constituted 33% to its total revenues (25% in FY99). It has reduced its low margin hardware business to 8% and has no plans to execute any orders in future.
At the current market price of Rs 783, PSI Data is trading at a P/E multiple of 34 times its 2QFY00 annualised earnings. The company's P/E multiple is comparatively lower than its peers in the industry. One reason is its higher onsite reveneues of around 55% where the margins are low. With its focus on Internet technology, e-commerce and strategic alliances, the company is likely to command premium valuations in time to come.
LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.
SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.
Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India. Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: email@example.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407