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Everonn System's debtor days increased to 208 vs 187

Published on Mon, Nov 09, 2009 at 13:17 | Source : CNBC-TV18

Updated at Mon, Nov 09, 2009 at 14:05

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In an interview with CNBC-TV18, P Kishore, MD of Everonn Systems, spoke about the latest happenings in his company and sector.

Below is a verbatim transcript of the exclusive interview with P Kishore on CNBC-TV18. Also watch the accompanying video.

Q: Let me start with ITC, your government schools business, which is not growing at the kind of clip your investors would like to see. Can you tell us through why growth is sluggish there?

A: The last quarter we have done extremely well. We have added 1,266 schools in the last quarter alone which is almost 25% of our last many years performance. So, we are now in about 5,708 schools across India. It has grown quite well last quarter.

Q: We are just not seeing revenues grow that much or even profitability from that segment flowing in. When will that happen?

A: That will happen in the following quarters because we have just signed up those contract and the contract is under execution mode. In the next couple of quarters, we will see revenues coming in there.

Q: Can you take us through the Vitel segment and how fast things have been moving there?

A: We have shown some great traction in Vitel. Currently, we have 734 schools across India, just last quarter we added 114 schools. But the great point has come in from our colleges. We have 1,165 colleges across India, added 225 colleges just the last quarter. Please note that was almost the biggest ever which we have done in the last quarter.

Q: Do you expect this segment to continue to deliver growth and profitability going forward as well?

A: Yes. This has been our key area of focus. We believe our Vitel's at our schools, specially the colleges, will keep more than a 100% growth rate.

Q: This is a little bit of a wrinkle on the debtor days which have gone upto 208 days. Any reason why that is happening and by when do you expect to get it down a bit?

A: We have, this quarter, set ourselves this on a priority. We would see it definitely below the 180 days this quarter that is our target internally. But as we go along with the contracts which we have with our government are all 180 day contracts. We expect mainly the new ones which we have bagged which will shorten this below that number.

Q: Between Vitel and ITC, you expect to continue report margins of 35-36% going forward?

A: It is possible. Yes, because we have the advantage of delivering this content into multiple locations, simultaneously; thus, we expect to retain those margins.