IT services business to boost growth: Ricoh India

Manoj Kumar, executive vice president & CEO, Ricoh India spoke to CNBC-TV18 about on the companies third quarter performance and the outlook going forward.According to him growth in core products and IT services helped boost topline in Q3. The IT services saw a growth of 200 percent in the quarter of which a large extent comes from government of India, he added.The third quarter net profit for the company came in at Rs10.6 Cr verus loss of Rs 0.2 Cr posted for the same period year ago. The net sales in the quarter were up 80.3% at Rs 409 cr versus Rs 226.8 crore. (YoY)Below is the transcript of Manoj Kumar’s interview with CNBC-TV18's Ekta Batra and Reema Tendulkar.Ekta: Take us through your performance this quarter, both your segments which is basically automation segment as well as your IT services?A: We have shown an overall topline growth of 81 percent in the just concluded quarter three over last year and this growth has been possible due to the significant increase in the businesses that we have shown in both these major lines which is our core products as well as the IT services.Ekta: So how much did each segment grow and what was the profit of each segment?A: Growth in IT services of course has been 200 percent plus and the other segment has grown by roughly about 30 percent. Also the contribution of IT services to our total topline is now around 60 percent. So, that speaks about where this growth in the quarter has come from.Reema: Can you tell us a little bit about your balance sheet what the debt is because finance cost has been a drag on the company’s financials?A: That is right. There has been a finance cost and that is to fund the growth requirements of the organisation. However, recently the parent organisation infused non-convertible debentures (NCDs) worth about Rs 200 crore which happened in the month of September and also they have invested in Ricoh India through commercial paper. So, all that has helped us to bring our bank borrowings down and therefore has had an impact on our finance costs also which going forward should come down. Reema: So how much is the debt on the books now?A: The debt on the books as of just now is roughly in the range of about Rs 500 crore. Ekta: And how much has it been reduced by?A: It has been reduced by about Rs 200 crore or so.Ekta: You said your IT services grew 200 percent for the quarter?A: Yes.Ekta: What lead to that, what is the guidance?A: IT services is a very growing market and there are several projects that we have got into. So, we are active players in the field of executing government government-to-citizen (G2C) projects plus also a very important player in executing certain high value commercial projects. So, with the government very seriously pursuing the agenda of financial inclusion, digitisation and automation, the IT services market is growing and that is where we are able to capture a very large pie.Reema: Majority of your IT services revenue comes from the Government of India?A: Yes, to a very large extent it comes from government.