Silverline: Secure move - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

Silverline: Secure move

Dec 20, 2001

Silverline has partnered with Diversinet to implement its suite of PKI (Public Key Infrastructure) based wireless security products. The move to enter into the security domain is a smart one. This is because a secure environment is one of the key enablers for e-commerce and m-commerce transactions. According to the agreement, Silverline will be the preferred professional services provider (implementer) and development partner for Diversinetís products. Silverline will also offer these solutions to its own clients. Therefore, this move will open an additional channel for the company to access prospective clients. It can hope to offer its services to some of Diversinetís clients in the future. But in the immediate future the company gets an additional revenue stream. Increasingly businesses and consumers alike are adapting to wireless mode of Internet accesses. Access to personal information like the balance in a bank account on mobile phones is a familiar service that banks offer. As wireless transactions become more commonplace, security will become a significant issue. Thus, corporate spending in this area is likely to see an increase. Silverline can hope for a certain amount of visibility from this revenue stream in the near future.

According to technology market research firm, Cahners In-Stat., the number of wireless Internet subscribers worldwide is expected to jump from 170 m in 2000, to more than 1.3 bn by 2004. Over one million internet-enabled mobile devices enter the market each month, and it is estimated that more than 1.5 bn devices will be equipped with wireless capabilities by the end of 2004. This translates to a significant market for security solutions.

Diversinet is one of leading providers of wireless security products. Silverline already has solutions for the wired networks. The partnership will enable Silverline to offer solutions for both the wired and wireless networks. Key markets that Silverline could hope to tap are the banking, financial services and insurance (BFSI) verticals. These companies require transacting high value information. This has to be done in a very secure environment.

Silverline in 2QFY02 had 48% of its revenues from this vertical. The companyís client list in the vertical includes American Express, Bank of America, Chase JP Morgan and Fidelity. Thus, the company could see some pace added to its revenues from this partnership. Interestingly, the security segment has not taken the fancy of Indian software companies. In that sense, the move could give Silverline the first mover advantage.

At the current market price of Rs 67 the stock is trading at a P/E multiple of 14x its FY02 estimated earnings (for Silverline Ltd.). We expect the companyís revenues to decline by 34% in FY02. The company has the advantage of being one of the larger players in the software industry. The stock is trading a discount to many of its peers due to concerns regarding future stability in earnings and the management.

Equitymaster requests your view! Post a comment on "Silverline: Secure move". Click here!

  

More Views on News

If You had Invested Rs 1 Lakh in TCS in 2011, this is how Much You Would have Today (Views On News)

Nov 30, 2021

Did TCS perform better than the market and its peers?

India's Top 4 IT Companies are Struggling. Here's Why... (Views On News)

Oct 22, 2021

As attrition rates are unbelievably high, top Indian IT companies are going for big-ticket raises, and much more hiring this year.

Infosys had an Exceptional Quarter Buoyed by Huge Deal Wins. Revenue Guidance Boosts Stock (Views On News)

Oct 14, 2021

Infosys raised its forecast for annual revenue growth to 16.5-17.5% from the earlier 14-16%, predicted in July 2021.

Info Edge: The Anatomy of an Indian Internet Behemoth (Views On News)

Oct 2, 2021

Info Edge is very popular in the Indian startup ecosystem due to its active participation in funding events.

This Indian Company is Tapping into the Huge Autonomous Driving Opportunity (Views On News)

Sep 14, 2021

Despite many challenges, Indian companies and startups have not shied away from entering this space.

More Views on News

Most Popular

Infosys vs TCS: Which is Better? (Views On News)

Nov 26, 2021

In the post pandemic era, the top two IT companies in India are fighting to capture the growing demand for IT.

This Multibagger Stock Zooms 20% After Dolly Khanna Buys Stake (Views On News)

Nov 24, 2021

Shares of this edible oil company zoomed over 50% in three days after ace investor bought around 1% stake.

6 Popular Stocks that Turned into Penny Stocks (Views On News)

Nov 27, 2021

A look at popular stocks that crashed big time and never recovered, i.e. which went from 'Multibaggers to Multibeggers'.

India's Top 5 Monopoly Stocks to Watch Out for (Views On News)

Nov 30, 2021

These 5 companies dominate their sectors with a huge piece of the pie.

5 Indian Companies Embracing Blockchain Technology (Views On News)

Nov 23, 2021

Blockchain adoption in India was slow in the past. Now, the technology is being well received.

More

Become A Smarter Investor
In Just 5 Minutes

Multibagger Stock Guide 2022
Get our special report Multibagger Stocks Guide (2022 Edition) Now!
We will never sell or rent your email id.
Please read our Terms

SILVERLINE TECH SHARE PRICE


Apr 19, 2012 (Close)

TRACK SILVERLINE TECH

  • Track your investment in SILVERLINE TECH with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
  • Add To MyStocks

MARKET STATS