HSIL Limited Clocks Strong Growth Post Revenue of ₹ 2726 Crore for FY 2018-2019; Jumps 21.2% Y-o-Y

HSIL Limited, makers of iconic brand Hindware, reported revenue of ₹ 2726 crore for the FY 2018-19, as against ₹ 2249 crore for the corresponding year FY 2017-18, registering a growth of 21.2% Y-o-Y on account of excellent sales and attractive growth opportunities harnessed across all the businesses. EBIDTA grew by 22.7%, to ₹ 346 crore in FY 2018-19 from ₹ 282 crore of the previous year.

Commenting on the year, Mr. Sandip Somany, Vice Chairman and Managing Director, HSIL Limited said, “Over the years, we have grown our brand Hindware to expand into other businesses and product categories. This has proven to be successful, with more than 60 million people connected to us today, making Hindware one of the most reliable and vibrant brands in the country. We credit this growth to our belief in innovation, re-invention and transformation, and this is a reflection of our world-class products that are designed to deliver only the best to our valued customers. This, backed by robust marketing capabilities, expanding distribution network and dynamically talented and motivated business teams have translated into strong growth and returns for our stakeholders.”

“Our strategic investments in the Pipes business has emerged as a solid winner with a record sales of over ₹ 130 Crore in a short span of eight months since making its commercial launch. Additionally, our Consumer Business has achieved sizeable growth of 47.2% in revenue in this financial year. As we look ahead, HSIL is on its way towards achieving a greater degree of success by capacity streamlining, brand segmentation and product range expansion to enable us to cater to a wider cross-section of consumers,” Mr. Somany further added.

Achieving new frontiers of growth in FY 2018-19, few Business Division highlights are:

• HSIL’s Packaging Products Division’s revenue surged by 21.2%, growing to ₹ 1115 crores from ₹ 920 crores during the corresponding period last year
• Consumer Products Division made significant strides and its revenue increased to ₹ 305 crore in FY 2018-19, registering a 47.2% growth year-on-year
• Building Products Division grew by 18.7% to ₹ 1222 crore  Y-o-Y

HSIL’s significant investment in distribution network, brand segmentation and product differentiation has started to yield encouraging outcomes. The brand Hindware is now present across multiple businesses and product categories, ranging from kitchen to bathroom to living rooms, and the company is relentlessly focusing on expanding the brand further.

Virtual Desktops on Microsoft Azure Power Aditya Birla Sun Life Insurance’s Sales Team Across 100 Branch

Aditya Birla Sun Life Insurance (ABSLI), one of India’s leading private sector life insurance companies, is adopting cloud technology to enhance experience, productivity and process efficiency for its team of insurance sellers and distributors. As part of the initiative, ABSLI has implemented Virtual Desktops on Microsoft Azure cloud for 1,400 members of its sales team, at over 100 branch locations across India. This initiative is enhancing customer acquisition and revenue generation for ABSLI.

ABSLI has been operating for nearly two decades, and has developed an extensive network of branches and partner agents. Adoption of Virtual Desktops on Azure cloud has reduced the capital expenditure involved in hardware refresh of a distributed IT infrastructure, reduced usage costs as the Virtual Desktops are on a pay-as-you-use model, and enabled availability of infrastructure during seasonal business spikes. It has also enabled ABSLI sales force to access data and applications across branch locations seamlessly, thereby improving end-user experience and productivity. The replacement of old desktops with virtual desktops has also led to power savings.

The Virtual Desktop, also referred to as Desktop-as-a-Service, solution has been implemented by Microsoft partner, Anunta. The solution has been designed for 1,400 users and 1,000 end-points. It includes Citrix Xen Desktop and Firewall implementation, data and Office 365 migration, peripheral integration, monitoring and management of complete VDI (Virtual Desktop Integration) stack in the Azure environment. ABSLI is now planning to rollout this solution for its entire sales team, across India.

Mohan Shetty, Senior Vice President IT, Aditya Birla Sun Life Insurance said, “Aditya Birla Sun Life Insurance is championing implementation of people-centric digital solutions that can ease the way our end-users perform their day to day operations. We wanted to implement cloud-based solution that could enable anytime, anywhere accessibility of data and applications for our large number of sales-force across branch locations in India. Anunta’s innovative EUC solution implementation on Azure Cloud enabled us to adopt secure cloud hosted desktops and has resulted in significantly enhanced end-user productivity, reduced power consumption, increased mobility of sales-force with access to data and applications anywhere, anytime, and enhanced end-user experience.”   

Rajiv Sodhi, General Manager, Partner Ecosystem Microsoft India said, “It is a delight to see how organizations with operations across the length and breadth of India are embracing digital innovation to drive business outcomes. The Virtual Desktops on Azure solution from Anunta is a first of its kind implementation, enabling Aditya Birla Sun Life Insurance to empower its field-force by ensuring anytime, anywhere access to core business applications, securely and in a cost-effective manner. The solution is improving end-user experience and process efficiency, and with seamless integration with legacy systems, is leading to enhanced productivity.”

Sivakumar Ramamurthy, COO, Anunta added, “ABSLI’s use of digital technologies has been exemplary and we are happy to have been a part of this journey. Using DaaS on Microsoft Azure, the company will be able to derive higher satisfaction for its customers as well as salesforce.”

“We are proud to see ABSLI pioneer DaaS on Azure solutions in the financial services segment by porting our virtual apps and desktop licenses on Microsoft Azure (IaaS). Being a business-critical project, this will enable Aditya Birla Sun Life in augmenting its digital transformation initiatives. The project has been successfully deployed for more than 1400 users across 100 branches ensuring a great end-user experience. Thanks to our partner, Anunta for successfully enabling ABSLI with a secure implementation and seamless transition in an extremely short duration,” said Dixit Roy Mahidhara, Regional Director, Citrix.

Persistent Systems Extends Partnership with Trend Micro from Endpoint Security to Virtual Server Security

Trend Micro Incorporated, a global leader in cybersecurity solutions, recently announced that it has been appointed by Persistent Systems to secure its VMware environments, after a successful endpoint security deployment for nearly a decade.

The solutions chosen are Deep Security, Trend Micro’s signature server security solution, and Apex One endpoint security, which Persistent Systems has been using to protect its 11,000 endpoints across the globe for almost ten years.

Featuring a blend of cross-generational security techniques, Deep Security provides multilayered, automated protection and comprehensive visibility needed for today’s increasingly complex IT security tasks. It is also tightly integrated with VMware, allowing it to intuitively protect the VMware infrastructure and automatically shield virtual machines (VMs) from malware and ransomware attacks.

“We were on the lookout for an agentless virus protection solution for our VMware virtualized environment. Trend Micro’s Deep Security helps us protect all the VMs from advanced threats and virus attacks without compromising VM performance. The product has helped us significantly reduce the admin overhead without compromising VM security,” said Sandeep Deshmukh, senior general manager, Technology Excellence, Persistent Systems.

“We were looking for a tool that would reduce operational efforts and achieve cost-efficiency. Trend Micro’s Deep Security really works for us and allows us to reduce operational efforts, and protect virtual machines from malware,” said Parag Karhadkar, senior general manager, Service Excellence, Persistent Systems.

Nilesh Jain, vice president, Southeast Asia and India, Trend Micro said, “We are extremely proud that our solutions are able to meet Persistent Systems’ high standards for endpoint and VMware server security. In addition, we also make our Premium Support Program (PSP) available to Persistent Systems, so they can receive prompt guidance for urgent issues and minimize issue escalations.”

Trend Micro’s position as a leader in the Gartner Magic Quadrant for Endpoint Protection Platforms since 2002, and in The Forrester Wave Endpoint Security Suites Q2 2018 Report, along with earning the rank of ‘most effective recommended breach detection system’ for two years running by NSS Labs, prompted Persistent Systems to choose Trend Micro over other solutions.

vivo Y91 and Y91i Available at Exciting New Prices Across India

vivo, the global innovative smartphone brand, today revised the prices of two smartphones in its Y series - Y91 and Y91i.  These power packed devices deliver the best of smartphone technology at an even more affordable price point. The devices are equipped with a high capacity 4,030 mAh battery further complemented by an exclusive smart power management system so that users don’t have to worry about running out of power. With the 13MP + 2MP dual Camera in Y91 and rear 13 MP camera in Y91i, the devices let you click pictures the way you want and the 8MP Front Camera ensures the perfect selfie shot. Additionally, Y91 has AI face beauty which detects gender, age, skin tone and lighting for beautiful pictures. The smart Y91and Y91i are available at a best buy price of Rs. 8,990 /- & Rs. 7,990/- respectively.

The stylish Y91 and Y91i smartphones come with an IPS LCD display and screen that can vividly display over  16M colours. Both the devices are equipped with powerful 2 GHz Octa core processor and 2GB RAM that enables the user to multitask smoothly. Y91 and Y91i run on Android Oreo 8.1 and comes with a 32GB memory expandable up to 256 GB.

The smartphones are a great blend of style and class which makes the smartphone appear very sleek. Connectivity options include 4G, VoLTE, 3G, Wi-Fi, Bluetooth, USB On-The-Go and GPS. The unique finger print scanner feature provides the smartphones with an impenetrable security that can be surpassed only by the user. vivo Y91 and Y91i will be available through  all brand outlets across the country.

IT Services Major Cognizant Reported Disappointing March 2019 Quarter on All Counts

CTSH delivered weak revenue growth, missed margin targets and reported decline in cash generation in March 2019 quarter. CTSH has cut CY2019 c/c revenue growth guidance to 3.6-5.1%, down from 7-9% at the beginning of the year citing weakness in banking, healthcare and weaker execution. Delivering on medium term goals laid out at the analysts’ day seems challenging. Turnaround themes have their set of challenges; CTSH seems to be going through one with broad-based slippages.

Cognizant misses revenue growth guidance for March 2019 quarter

CTSH reported constant revenue growth of 6.8% in c/c, lower than guidance range of 7.5-8.5% for March 2019 quarter. On organic c/c basis growth was 4.2%. On a sequential basis, CTSH reported revenue decline of 0.5% to US$4.11 bn. Management indicated that revenue growth started weakening towards the second half of the quarter. The magnitude of miss for the quarter was surprising noting that guidance was laid out in the first week of February. The revenue miss was contributed by the slowdown in growth to a trickle in financial services (0.2% yoy c/c growth, 1.5% qoq USD revenue decline) and healthcare (+4.6% yoy in c/c, negligible excluding Bolder acquisition and down 3.1% qoq in USD terms). Other vertical continued robust performance. GAAP EBIT stood at 13.1% and had 290 bps impact from the recent Supreme Court of India ruling on Defined Contribution Obligation; CTSH has accrued impact of the ruling assuming retroactive application. Adjusted EBIT margin of 16% fell short of guidance primarily due to flow through impact of weaker revenue growth.

Steep cut in CY2019 revenue growth guidance, adjusted EBIT margin guidance band cut 17%

CTSH has cut CY2019 revenue growth guidance to 3.6-5.1% in c/c (guidance includes inorganic component), down from 7-9% growth guidance set out at the beginning of the year. Revised guidance bakes in 170 bps contribution from inorganic growth. Cut in guidance captures—(1) slowdown in the financial services vertical (35% of revenues) that was broad-based. Revenue decline from three of the five large banking clients continued. Regional banks are turning more cautious on spending outlook. M&A in regional bank client base also impacted revenue growth outlook. Guidance does not assume any recovery or deterioration in the financial services business and (2) healthcare vertical (28% of revenues) was impacted by M&A in the client base, accelerated movement of work to a captive center at a large North American client. Revised guidance assumes 0.5-2% sequential revenue growth in 3Q-4Q of CY2019. CTSH also cut adjusted EBIT margin guidance to 17% from 19% for CY2019. The company attributed the entire shortfall to weaker revenue growth outlook relative to initial expectations. EBIT margin expectation for 1HCY19 stands at 16% with recovery expectation in 2HCY19 (implied closer to 18%). CTSH cut CY2019 adjusted EPS guidance by 10-12% with a revised number that stands in a range of USD3.87-3.95/ share. CTSH expects to deliver 3.9-4.9% revenue growth in constant currency for June quarter.

Turnaround themes are difficult; CTSH has a few challenges at hand

CTSH’s poor performance surprised us. Weak revenue growth and guidance cut reflects execution challenges at CTSH rather than industry wide growth slowdown. The transition to a profitable growth model initiated a couple of years back had its share of challenges which have been compounded by slippages in execution. The new CEO has a challenge at hand. We would not be surprised with a few leadership changes, common in any turnaround effort. Against this backdrop, ability of the company to deliver board-backed medium term revenue growth target of 7-11% and EBIT margin of 19% with 10 bps expansion every year seems unrealistic to execute in the near term.

Timing the turnaround themes is challenging. CTSH stock may seem inexpensive after the potential correction in stock price but will have its share of bumps in performance and disappointments.

Read through for other IT services companies

Large part of the slippages seems specific to CTSH and not representative of growth across the industry. However the risk to industry growth from the financial services vertical cannot be denied. Clients in the capital market segment of banking have turned a bit more cautious in spending outlook. In addition spending by regional banks in the US is also turning cautious. Other segments of financial services are steady in our view.

Key highlights from earnings call

* Commentary on BFSI: BFSI vertical registered flay yoy growth in constant currency. The vertical is affected by insourcing among CTSH’s BFSI clients. The company reported conservatism in spending among several regional banking clients in North America with some banks impacted by M&A activity. Slowdown in decision making particularly around larger deals in the pipeline due to executive transitions in several clients impacted growth in insurance. Softness in three out of the top five clients is expected to continue in the near term. Management expects pressure on banking spends in 2HCY19 due to moderating growth outlook in the business.

* Life sciences and healthcare. M&A related activity accelerated movement of work to captives in a large client and ramp down of an account in which CTSH is a subcontractor impacted growth in the vertical. The company expects further deterioration in the next quarter and reported sluggish outlook for the full year. Softness was mainly in the healthcare payers business. The company reported strong double-digit growth in life sciences sub-vertical.

* Commentary on products and resources and communication & media verticals. The company reported strong double-digit constant currency growth in retail and consumer goods, travel and hospitality as well as in manufacturing, logistics, energy and utilities. Retail sub-vertical was strong despite bankruptcies in a few smaller clients. Growth in digital services for media and entertainment clients offset slower growth in the communication industry which is affected by consolidation trend.

* Margin levers. The company expects margins to improve in 2HCY19 on the back of procurement optimization, better utilization, improved pricing, simplification of business unit overhead structure, rationalization of delivery costs and shift to higher value services such as digital

* Digital. Digital business now accounts for 33% of overall revenue and is the primary driver of growth. Digital revenue growth in the quarter was strong at 20+%. Core modernization, digital engineering, AI and analytics, intelligent process automation, platform solutions, interactive customer experiences and IoT form the core of Cognizant’s digital strategy

* Senior management. Ex-CEO Frank D’ Souza who is currently in the role of Executive Vice Chairman will transition to Vice Chairman of the Board at the end of June 2019. Raj Mehta has stepped down as president. Malcolm Frank has been appointed as the new President of Cognizant’s digital business. Prasad Chintamaneni, EVP and President of Global Industries and consulting will additionally manage the banking business on an interim basis.

Week-Long Bamboo Art Exhibition by Uravu Inaugurated at Karnataka CKP Until May 7

‘Hiraeth: A Pining for the Past’, a first of its kind 6 day exhibition of bamboo installations organized by ‘Uravu Indigeneous Science and Technology Study Centre’ was inaugurated by internationally acclaimed painter and Artist-CuratorShri Bose Krishnamachari. The exhibition will be open to the public until May 7th at Karnataka Chitra Kala Parishat, Bangalore.

‘Hiraeth’ is an exploration in bamboo that aims to reinforce the credentials of bamboo as a sustainable medium of art. Lenin.CP, the chief designer at Uravuaims to recreatethe forms and frames of life in bamboo. He expresses it through the idea of water and the flora and fauna of watery village lives.

‘Hiraeth’ is expected to set a platform for a series of exhibitions to be held at Chitra Kala Parishat, Bangalore, to showcase distinct artistic possibilities in bamboo that that would establish bamboo’s potential as a serious material of art. Hiraeth is presented by Eleganz Interiors pvt ltd

Uravu is a not for profit, non-governmental organisation that strives for rural empowerment through sustainable solutions. Established in 1996, URAVU works with people, governments and businesses to facilitate initiatives with the   prime motive of sustainable development and implements focused end-to-end programs in the bamboo sector.

Linium Receives Award for Delivering Outstanding Value in Digital Transformation, innovation

Linium, a Ness Digital Engineering Company and a leading provider of digital business, engineering, experience and transformational consultancy services, has been recognized by ServiceNow as the 2019 ServiceNow Americas IT Workflow Partner of the Year. The achievement is the result of demonstrating overall excellence in expanding the breadth and depth of its IT Transformational Cloud Practice size.

The ServiceNow Global Alliances and Channel Ecosystem recognizes the achievements and contributions of its best in class partners who have successfully grown its ServiceNow business through transformation or innovation in business, technology and customer success. This year's awards are based on partner performance in 2018 – a combination of revenue contribution, product line expansion, workflow and skill growth, and business innovation or transformation.

“Always doing the right thing for our customers, employees, and partners is core to Linium’s culture and integral to sustained success,” said Joe Burke, president, North America at Linium. “This award reflects our comprehensive approach to helping our customers leverage ServiceNow as part of their overall digital business strategy. Our deep roots in software engineering help us guide our customers and take into account a range of areas from data and analytics to DevOps and automation. Today’s organizations need to elevate employee experiences and reshape customer service, and Linium is fully committed to making this a reality for our customers.”

With over 3,500 successful enterprise transformations since its inception in 2000, Linium enables modern workforce experiences and empowers organizations to make better decisions faster by enhancing collaboration, reducing manual tasks, aligning work to business priorities, and resolving issues quickly and proactively. Converging 4,000+ strategic thinkers, exceptional technologists, and user experience experts from around the globe, Linium is dedicated to creating the most value-driven experience for its customers by applying non-traditional thinking to solve traditional business challenges. From designing cutting-edge modern service experiences to mitigating compliance risk; gaining financial visibility to resolving security threats; building custom applications to managing operations, Linium solves complex business challenges across the enterprise.