Stable currency, IT services push to improve Ricoh's profits

Tokyo-headquartered Ricoh Company Ltd's Indian subsidiary is hopeful of posting better profits this fiscal supported by a stable rupee-dollar rate and a strong push into IT services. The company is into imaging, IT services and communications.

“With the dollar stabilising against the rupee in the last one year or so, we see improvement in profits in the current fiscal,” said Manoj Kumar, executive vice president and CEO of Ricoh India Ltd.

Ricoh India is also confident of registering a 50 per cent growth in topline in the current fiscal, in line with what it was doing in the last three financial years, he said. It expects revenues to grow to around Rs 1,500 crore as against Rs 1,047 crore in the fiscal ending 2013-14.

According to Kumar, in the financial years preceding the 2013-14 fiscal, the appreciation of dollar against the local currency had led to higher import costs for several products, affecting its profits. “Dollar rise affects our bottomline tremendously. One key reason why our profits have been under pressure for the last two years (2011-13) was due to the rise in dollar that has led to a rise in import costs,” he said.

Led by increased demand for IT services in the country, the company expects its contribution to the total turnover to rise from the previous fiscal’s 45 per cent to 55-60 per cent in the current fiscal. “We have been able to spread our risk from higher import costs with the introduction of IT services,” he said.

It recently was selected for a joint five-year Rs 1,370-crore India Post project to supply hardware solutions as a part of the latter’s modernisation initiative.

As part of its growth plans, Ricoh has plans to emerge as a strong IT services player and focus more on Tier II, III locations where the demand for IT, imaging and communication services is growing.