CMC was trading barely 1% higher at Rs 494.05 in early afternoon trades on Thursday giving back a major part of gains secured on news of its bagging an order in the Middle East.
The scrip of the Tata group computer hardware and software maintenance and services company had hit a high of Rs 503 earlier in the day after a flat opening. But those levels could not be maintained. 30,000 CMC shares were traded on the counter on BSE so far.
Over the last few months, CMC has witnessed sustained buying on interludes of selling. In the last few trading sessions, the stock has been moving in a band of Rs 490-515. At the current Rs 494.05, the stock is trading substantially higher than its 52-week low of Rs 321. It, however, is sharply off its 52-week high of Rs 749 as well.
The rise in CMC on Thursday comes after the company said that it won an order from the National Bank of Bahrain, a front runner among banks in the Middle East, for the installation and implementation of CMC's core banking solution - TC/4. This is a significant win for CMC in the Middle East marketplace, CMC said. CMC did not reveal the size of the order.
CMC is involved in design, development and implementation of software technologies and applications. It also provides professional services for export and procurement, installation, commissioning, warranty and maintenance of imported and indigenous computer systems, education and training and networking services. For these activities, the company has different segments namely Customer Services, Systems Integration, Indonet, Education and Training. Besides, the company has a wholly owned subsidiary, Baton Rouge International in the US.
CMC has a large base of reputed clients in verticals like transportation, and a large share of the domestic market with work done for the Indian government in Railways. CMC has over 32,000 consultants. CMC and Tata group software giant Tata Consultancy Services have a joint marketing strategy in place .
For Q3 ended 31 December 2002, CMC posted impressive results. On a 21% rise in sales to Rs 139.07 crore, its net profit surged 45% to Rs 10.14 crore. Operating margins more than doubled during the quarter.
The Customer Services and Systems Integration business unit of CMC received some significant orders in Q3 in the areas of IT infrastructure management, call centre operation in telecom etc.
Going forward, CMC wants to leverage its association with Tata Consultancy Services. It has already started executing some new projects teaming up with TCS in the North American and Indian markets. On the back of this relationship, the company has given a guidance of sales growth of around 25% to 30% and improvement in margins by around 30% for the year ending 31 March 2003.
However, CMC's education and training business has been going through a rough patch in keeping with the general industry trend.
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