MEGASOFT Share price

COMPANY AND MANAGEMENTBRIEF HISTORY AND PROFILE OF THE COMPANYMegasoft Limited was incorporated on 29th June 1999 with the object ofbecoming a "Total Solutions Provider" for the Software challenges facedglobally. Mr Ravindra Sannareddy a Non-Resident Indian residing in USis the main Promoter of the Company. The other Promoter Director of theCompany is Mr S Rajagopal Reddy who is father of Mr RavindraSannareddy. The Company is a provider of comprehensive IT consultingservices for a global customer base that include both Fortune 500 andsmall to mid-size companies as well as numerous public-sectororganisations.The Company has completed two years of operations. During these twoyears the Company successfully set up offshore development facilitiesin Chennai and Hyderabad. The Company has resourcing/marketing officesat Bangalore and Hyderabad to tap the cream of software professionaltalent for offshore software development onsite projects and forexpanding the domestic IT business. During the first six months ofcommencing the business the Company posted a turnover of Rs. 138 lacsand profits of Rs. 13.23 lacs.As part of its expansion programme the Company entered the capitalmarkets with the reverse merger of Indus e-Solutions Limited a ListedCompany with effect from 1st January 2000 as per the Honourable HighCourt of Madras orders with itself. The merger has benefited theCompany in obtaining the extra capital (Funds). The Equity Shares ofthe Company are listed at the Stock Exchanges at Chennai MumbaiAhmedabad and Hyderabad. Further to spread its geographical reach theCompany opened subsidiaries at Singapore Malaysia and Hong Kong andoverseas office at Virginia US. The Company also tied up with variousGlobal Majors like Microsoft Oracle Remedy for business development.Hence in addition to establishing a strong base in India during thelast two years the Company has also significantly expanded itsGlobal operations and today along with its Associates and AffiliateCompanies is present in eleven countries across the world. On themanpower front the Company's strength increased from 52 in Jan-2000 to347 in Feb-2002.The performance of the Company despite dull phase in current economicsituation world wide has been quite commendable. The Company continuedto grow in the financial year 2000-01. The Company's turnover in thefinancial year 2000-2001 increased to Rs. 2185 lacs with profits of Rs.321 lacs. Continuing the growth trend the audited results of theCompany for the half-year ended 30th September 2001 show an income ofRs. 1473.60 lacs with net profits of Rs. 64.67 lacs. The Company madeforeign exchange earnings of Rs. 1951.82 lacs in the year ended 31stMarch 2001 (15 months).Since its inception the Company has been concentrating on continuouslyimproving its quality of service and has been awarded the ISO 9001certificate for quality by KPMG an International Consultancy firm on31st March 2001 effective 22nd February onwards. The Company has beenable to provide high quality delivery capabilities from the offshoresoftware development centres and has executed several projects forcustomers across US UK and Europe besides the Asia-Pacific Region.The Company on 3rd September 1999 was permitted to set up a Hundredpercent export oriented unit under the Software Technology Park Schemeof Government of India.Merger of Indus e-Solutions Ltd (formerly Orion Plastek Ltd)Megasoft Limited entered the Indian Stock Exchanges for the first timeafter the merger of Indus e-Solutions Limited (formerly Orion PlastekLimited) with the Company. Indus e-Solutions Limited a SoftwareDevelopment and Solutions Company with its principal office in Chennaientered the Stock markets in 1995 in the name of Orion Plastek Limited.The Company went public with an issue of 2950000 Equity Shares of Rs.10/- each for cash at par aggregating Rs. 295.00 lacs for partfinancing the project for manufacture of Plastic Blown Film Lines. TheIssue opened on 27th May 1996 and closed on 31st May 1996. The issuewas fully subscribed. The Shares of Orion Plastek Limited were listedon the Stock Exchanges at Madras Mumbai Ahmedabad and Hyderabad.The Company did not start its commercial operations. As the revival ofthe Company seemed to be bleak the Company shelved its business andventured into Software development e-solutions e-commerce Internetand Web related activities. The name of the Company was changed toIndus e-Solutions Limited effective 29th September 1999 as per theRegistrar of Companies Tamilnadu letter No.30474/S21/99 dated 29thSeptember 1999.Indus e-Solutions Limited got merged with Megasoft Limited as per theorders of the Honourable High Court of Madras dated 9th June 2000 theeffective date of the merger being 1st January 2000. The valuationreport of M/s SB Billimoria & Co. Chartered Accountants a leadingfirm dated 10th January 2000 recommended a stock swap ratio of 1:1 forthe merger. The Shareholders of both the Companies approved the Schemeof Amalgamation at the Court convened Meeting held on 4th March 2001.The Shareholders of Indus e- Solutions Limited were thus issued sharesof Megasoft Limited in the ratio of 1:1 (detailed in the build up ofcapital structure) as per the Scheme of Amalgamation.Pursuant to the Scheme of Amalgamation the assets and liabilities ofIndus e-Solutions Limited were transferred and vested in the Companywith retrospective effect from 1st January 2000. The scheme ofamalgamation has accordingly been given effect to in the accounts ofMegasoft Limited. Consequent to the Amalgamation 5150500 EquityShares of Rs. 10/- each were allotted at par to the shareholders ofIndus e-Solutions Limited in the ratio of 1:1 on 24th August 2000.