14 – The E3 Mantra

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CMD:
V CHANDRASEKARAN

This Chennai-based company has moved up to # 14 from the previous year’s # 16
rank in the DQ Top 20 survey. It has grown by about 70 percent to finish 1997-98 at Rs
291.5 crore, compared to previous year’s Rs 171.54 crore. But what is most impressive
is the fact that PSEL has maintained a CAGR of 80 percent over the last five years.

PSEL’s main focus this year is to increase revenues
from places other than the US. By dividing its operations into the E3
categories–namely Entertainment, Enterprise, and Education–the company is
confident of increasing its market presence in other countries. The E3 has further been
divided into six strategic business units–Y2k, ERP, Banking, Insurance, Multimedia
and CD-ROM titles, and the Internet.

pentafo1.jpg (11992 bytes)PSEL’s work on the world’s first full 3D movie with real-time
animation, Sindbad: Beyond the Veil of Mists, for producer Improvision Inc. in
Hollywood has been the company’s hallmark achievement in the last year.

Which is just the beginning of the company’s focus
to revolutionize the entertainment segment, particularly the film and broadcasting
industries. In addition to its existing Digital Imaging Center in Chennai, PSEL set up
another, 8,000 sq. ft studio at Hollywood, which will take up 30 percent of the multimedia
projects.

S T R A T E G Y
  • Focus on export market for software.
  • Develop more resources for off-shore projects.
  • Develop its own software products with special emphasis
    on multimedia and image processing.

T A C T I C S

  • Planned mix of entertainment and business software.
  • Multimedia, banking, insurance, and healthcare identified
    as major segments of business.
  • Will increase its worldwide revenue, other than the US,
    through its 17 registered offices in different parts of the globe.

O B J E C T I V E S

  • To become one of top 10 multimedia production houses in
    the world.
  • To revolutionize the entertainment sector, particularly
    the film and broadcasting industry, through multimedia and interactive information
    technology.

P E R F O R M A N C E  H I G H L I G
H T S

  • Seventy percent growth in revenues, 45 percent growth in
    net profits, 70 percent growth in exports.
  • Projects and products have contributed to 69.34 percent
    on-site consultancy contributed 27.70 percent, and education and training contributed 2.96
    percent.
  • Fifty-five percent dividend declared.
  • Book value at Rs 153 and equity net worth at Rs 260
    crore.

PRODUCTS AND SERVICES: Software Development,
Training & Education
* TECHNICAL COLLABORATION: IBM, Synon, Silicon Graphics * START-UP YEAR: 1991 * EMPLOYEES: 1409 * QUALITY CERTIFICATION: ISO 9001, ISO
9002

*
ADDRESS: No.1, First Main Road, United India Colony,
Chennai 600004
* TEL:
4833067, 4836934, 4840298

*
WEB SITE:
www.pentafour.com

To enable a computer to mean what a camera today
is to the film industry, and use IT as a mixing medium rather than as a processing unit,
is the goal that the company has set for itself. Its foray into the Indian film industry
in the last two years, with films such as Avvai Shanmughi and Jeans, has
helped build the brand equity of the company in the domestic market too.

The company has over the last two years made heavy
investments on building the necessary infrastructure and core competency in studio
technology through its alliance partner Silicon Graphics Inc.

On the enterprise side, too, the company’s dual
strategy has been to focus on projects and products. The rapid growth of multimedia
software, now accounting for 48.5 percent of its revenues, is clearly indicative of the
company’s focus on multimedia. PSEL bagged multimedia projects for Nanyang
Polytechnic, Singapore, and the Port Trust of Singapore.

As for products, PSEL launched two new products,
PentaMedia and PentaWare, at Comdex, Las Vegas, last year. The Internet team of the
company developed PentaGuru, an online training system, and PentaHelp, an online help-desk
product.

PentaBank—the bank automation software from
PSEL—is another product, which is being marketed by Tata-IBM alongwith the
latter’s AS/400 systems. PSEL’s insurance product—PentaLife—did well
and the company completed two projects for Lamco Insurance, Mauritius, and Thai Prasit
Insurance Co., Thailand.

PSEL strengthened its presence in the Enterprise
Resource Planning (ERP) segment through its tie-up with System Software Associates as
implementation and training partner for the latter’s flagship product, BPCS, in
India, and with SAP and Oracle as implementation partner through Siemens Infomation
Systems Ltd. The company progressed on the implementation work for TVS Suzuki, Shivaki,
and some other clients in India.

By spinning off a high-end training division, PentaSoft,
PSEL gave a facelift to the education sector. PSEL is also the Authorized Training Center
(ATC) of IBM for all major platforms, an ATC of Silicon Studio Inc., and a Developer
University Partner for Apple. Last year, it also extended its own training courses on SAP
and BPCS, and launched VISA courses in client/server,
pentafo2.jpg (19754 bytes)multimedia, and IBM.

However, the one area where PSEL could not meet its
target was the launching of CD-ROMs. As against the target of 100 CD titles last year, the
company released only 44, which shortfall it attributed to minor technical problems in
pre-mastering. The company expects to come out with another 100 CDs this year.

What’s more, PSEL is expanding its global network
rapidly and making forays into newer markets such as Canada, Australia, Malaysia, and
Japan, apart from establishing a liaison office in Kenya with a view to capturing the
African IT market. This year will see PSEL’s significant revenues coming from Japan,
too, where it has bagged orders from clients such as Sumitomo Corp., NEC, Nippon
Systemware etc.

A new initiative for PSEL is Australia. Not only is the
company looking at the telecom, mining, and manufacturing sectors offering good potential
for IT services, but it has its eyes set on substantial opportunities at the Sydney
Olympics in 2000. Apart from that, with the establishment of a training center at
Singapore—and three more on the anvil in USA, El Salvador, and Canada—PSEL has
made a foray into the international training market.

With technical alliance partnerships with world leaders
such as IBM, Synon, and Silicon Graphics, PSEL is adding to its portfolio of tie-ups names
like Autodesk, Microsoft, and PeopleSoft. It has acquired the training developer status
for Autodesk and is in talks with Microsoft to bundle its banking and insurance products
with Windows NT and SQL Server. PeopleSoft is next in the list of ERP products for
implementation and training.

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