Dsq Software Sees Better First-Half Sales

DSQ Software, the Chennai based software company, recorded an impressive overall growth in 1997-98. While sales increased nearly 83 per cent, net profit climbed by over 64 per cent. In the first half of current fiscal too the company significantly bettered its performance.

During the first-half ended September 30, the company's sales leaped by over 115 per cent. The software market scenario improved considerably during the last fiscal. During the first half of the current fiscal too demand rose. Besides, the better sales was mainly due to higher demand in the international market.

M G Ghouse, chairman, DSQ Software, pointed out the company has set up dedicated development centres for NEC, NEDCAR, Nippon Systemware and OKI Electric. In the current year, it has added new clients to its list like Levis, ABN Amro, Volvo, Rover, GE, Sanwa Bank, Aerospatiale-France and Credit Suisse First Boston.

By virtue of a better sales performance, the company recorded a near 75 per cent jump in operating profit. Net profit increased by more than 83 per cent. The company achieved this feat despite higher total expense and interest burden.

DSQ Software started to improve its performance from the first quarter of the current year itself. During first quarter 1998-99, sales rose to Rs 42.2 crore from Rs 19.8 crore the previous corresponding quarter - an increase of nearly 113 per cent. Net profit climbed from Rs 4.76 crore to Rs 8.84 crore - an increase of 85.7 per cent.

Similarly, in second quarter of the current fiscal, sales growth was nearly 118 per cent - from Rs 24.3 crore to Rs 52.8 crore while net profit increased from Rs 6.44 crore to Rs 11.7 crore - a rise of over 81 per cent.

The company's annualised EPS increased to Rs 20.27 from Rs 12.31 the previous year while its net profit margin increased slightly - from 21.3 per cent to 21.6 per cent. The share price of the company too moved more or less in tandem with its financial performance.

On June 30, the stock was quoted at Rs 256.40. On August 27 it moved up to Rs 314.40 but fell to Rs 234.60 on September 18 due to depressed market conditions. Subsequently it touched Rs 279.80 on October 14.

On October 12, in an out-of-the-court settlement, the Commonwealth Development Corporation agreed to offload its 19 per cent holding in DSQ Software in favour of the company's promoters, the Dalmias. After the agreement, the promoters' stake in DSQ Software will increase to over 60 per cent.