Edserv sees Q3 rev up 40% sequentially

Edserv sees Q3 rev up 40% sequentially

Mumbai: Edserv Softsystems Ltd expects third-quarter revenue to rise by about 40% on a sequential basis, as the education services provider gets more government deals and expands its e-learning business, a top official said on Wednesday.

The company, which provides vocational training, school education and online education services, is pitching for deals to set up Industrial Training Institutes across the country.

“We are likely to announce few such deals in the near future, may be in the next one or two months," S. Giridharan, chairman and chief executive, told Reuters. “In the second half, we can expect government deals to contribute more to revenue."

The Chennai-based company has also been expanding its network of schools, which it expects to add to revenue during the December quarter.

It plans to have 150 schools by the fiscal year-end from 60 at the end of the September quarter.

Earlier in the day, Edserv said its July-Sept net profit more than doubled, boosted by government contracts and its online education services business.

The company, which went public in March 2009, posted a net profit of 91 million, compared with 39.6 million a year ago. Revenue surged 145% to 273.6 million.

Edserv’s online education services business, lampsglow.com, contributed 20-25% to total revenue, while government deals accounted for 40-45%, Giridharan said.

Edserv said it is confident of recording a net profit of 400 million on revenue of 150 crore this fiscal.

The company, which raised 610 million via a qualified institutional placement last month, said its board has approved raising more funds through the issue of shares or warrants on a preferential basis.

“The proceeds will be used to fill up the rest of the 130 crore project expansion plan that we have," Giridharan said, adding the company has already raised 108 crore.

At 3.10 p.m., shares of Edserv were trading down 0.57% at 227.95 in a choppy Mumbai market.