Investing Reflections On India

MRO Tek operates in the computer hardware industry within the networking and communications segment.  It manufactures digital modems and converters and aims to cater to 3g/broadband demand. The company has reported a consistent decline in revenues and operating profits over the last five years, representing a decline in competitiveness – it reported operating losses on revenues of about 25cr in the last financial year.  However, it had a net cash position of about 16cr as at 30 th September, 2011. The business operates in a fast-changing field where new technology renders business models obsolete.  This, perhaps, is the reason for the company’s massive revenue decline.  It is also exposed to the risks of delayed launches and large gestation periods of own products, which could be lethal in such a dynamic industry.

Jetking Infotrain operates in the IT education industry, providing training solutions for hardware and network professionals. The company has over 100 centres throughout the country and has partnerships with IBM for training material, WIPRO for recruitment and various colleges for training students.  It aims to adjust its curriculum according to demand and hence, focuses on recruiter requirements when drafting its courses. The company has reported declining revenues and operating profits over the last five years – reporting about 10cr of operating profits on revenues of about 40cr in the last financial year.  It employed no net debt in its operations and had liquid assets amounting to about 18cr as at 31 st March, 2011. The business is subject to the risks of rapidly changing technologies such as cloud computing, which question the need for extensive hardware/network systems.  Therefore, the company has to always be on the watch to update its curriculum, w...