Pune: Ganesh Natarajan, vice-chairman and CEO, Zensar Technologies, the Information Technology (IT) business unit of the RPG group, doesn’t complain about the recent downturn.
The mid-cap IT company’s top line has been growing in double digits. During 2008-09, when the IT industry was in the doldrums, Zensar’s top line grew 16 percent and net profit was up 35 percent on a year-on-year basis. This at a time when the overall net profit of mid-cap IT companies declined 14.3 percent.
In the past seven quarters, Zensar’s net profit grew substantially higher than frontline IT companies, said analysts. According to a recent ShareKhan analysis, the company’s revenue, EBITDA (earnings before interest, tax, depreciation and amortisation) and net profit grew at a compounded quarterly growth rate (CQGR) of 3.5, 7.7 and 9.9 percent, respectively, over the period.
That was reason enough for the Harvard Business School to prepare a case study on the company’s business model — how it sustained during the slowdown.
Natarajan, who was brought in when Zensar was deep in the red in 2001, said the reason for the smart turnaround was due to the initial investment the company had made on people, cost efficiencies and geographical expansion.
The “On the revenue side, one has to adapt to change. We entered three new verticals right in the midst of slowdown — utilities, media and entertainment, and education — and they are all doing well. The other aspect is non-linear focus, cost efficiencies and delegation of work,” he said.
