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IT Public Issues: Gathering Momentum

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DQI Bureau
New Update

The continued Bull Run on the markets and the improving fortunes

of the technology sector has meant that it's time again for small and medium

companies to hit the public issue space. With the recent Info Edge issue being

oversubscribed 55 times, expect a number of software and dotcom companies to

come to market. As usual, caution is the keyword before retail investors get

overtaken by market sentiments and invest into companies without looking at the

merit of the issue. This is an enthusiastic phenomenon that repeats itself with

each such euphoria in the capital market.

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Among the companies that went public in recent time the investor

interest has been as mixed as can be-as seen from the table below. We cover

two such companies: Paradyne and Tulip IT Services.

Paradyne

Infotech: Financials

Quarter Ended

Growth



(%)

Year Ended



Mar-06

Particulars

Sept-06

June-06

Sales

30

27

13

87

Operating Profit

5

4

20

11

Operating Profit Margin (%)

16

15

NA

12

Net Profit

3

3

18

7

Equity

11

11

-

11

EPS (Rs)

3

3

-

7

All figures in Rs crore unless

stated otherwise. All figures rounded off.



Full year ended is for a period of 12 months

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Paradyne Infotech



Paradyne Infotech is an IT services company into application software and
technology infrastructure management services. Paradyne's services and

solutions are focused on industry verticals like Banking & Finance,

Manufacturing & Retail, ISVs, e-Governance, Education & Research etc.

The Company has developed two quality products: HRWorQ-a complete suite of

human resource information management system, and FinWorQs-a banking solution.

Paradyne has its presence in the US market through its

subsidiary, Dyne Techservices Inc. Headquartered in Mumbai, Paradyne Infotech

announced its results for the financial year ended March 31, 2006. Revenues

stood at Rs 86.7 crore, an increase of 26.6% from Rs 68.5 crore in the same

period last year. Net profit increased to Rs 7.2 crore from Rs 5 crore, an

increase of 44%.

For the quarter ended September 30, 2006 revenues for the

quarter stood at Rs 30.1 crore, an increase of 12.64% on q-o-q basis as compared

to Rs 26.7 crore in the sequential quarter. The company's EBITDA stood at Rs

4.7 crore for the quarter as compared to Rs 3.9 crore in the sequential quarter,

an increase of 19.5%. Net Profit increased from Rs 2.8 crore to R. 3.4 crore, a

sequential q-o-q growth of 18.3%.

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The company entered the capital market on September 30 with an

IPO of 33 lakh equity shares of Rs 10 each for cash, at a premium of Rs 32 per

share. It has been over-subscribed 42.8 times.

Paradyne Infotech entered into strategic alliances with many IT

companies like Oracle, Sun Microsystems, IBM, Cisco Systems, Acer and Microsoft,

which will widen its horizons in terms of IT solutions, technology, processes

and markets. The share of the company trades at Rs 68.

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Tulip IT Services



Tulip IT Services is a provider of end-to-end data connectivity. It offers
MPLS based network, offering wireless based last-mile connectivity in 550 cities

in India. Services provided have been certified to ISO 9001:2000 standards by

KPMG.

Tulip:

Financials

Quarter Ended

Growth



(%)

Full Year Ended



Mar-06

Particulars

Sept-06

Sept-05

Sales

185

117

58

508

Operating Profit

26

10

159

55

Operating Profit Margin (%)

14

8

NA

11

Net Profit

20

10

109

49

Equity

29

20

-

29

EPS (Rs)

7

5

-

17

All figures in Rs crore

unless stated otherwise. All figures rounded off.



Full year ended is for a period of 12 months

In the financial year ended March 31, 2006, total revenue stood

at Rs 508.4 crore, an increase of 48.6% from Rs 342.2 crore. Net Profit for the

period was Rs 48.5 crore, an increase of 248% from Rs 13.92 crore.

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Total revenue for the quarter ended Sept 30, 2006 increased to

Rs 185.2 crore as against Rs 117.4 crore in the same period last year, a 57.8%

increase. Revenues from IP/VPN segment witnessed a growth of 278% from Rs 17.7

crore in Q2 '05 to Rs 66.8 crore in the current quarter. Revenues from network

integration were recorded at: Rs 118.28 crore in Q2 '06, up from Rs 99.6 crore

in Q2 '05, a 17% increase from Q1 '06. Net profit was Rs 20.2 crore, an

increase of 110% from Rs 9.7 crore.

During Q2 '06 the number of connects in IP/VPN business went

up to 24,106 connects from 14,980 at the beginning of the quarter.

Acquisitions in the quarter include Aditya Birla Group, Bajaj

Allianz, SIDBI Bank, NTT Com India, Safeexpress. Tulip received the National

Long Distance License from the Department of Telecom and was also awarded the

Letter of Intent for International Long Distance license.

Tulip entered into a collaboration with NTT Communication India

to provide connectivity services on Tulip's MPLS network to NTTCom's global

customers based in India. NTT Com India is a 100% subsidiary of NTT

communications which is a subsidiary of Nippon Telegraph and Telephone (NTT)

Corporation. The shares of Tulip trade at Rs 386.

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