Wealth Maximization: Wealth maximization has been accepted by the finance managers, because it overcomes the limitations of profit maximization. Wealth maximization means maximizing the net wealth of the company’s share holders. Wealth maximization is possible only when the company pursues policies that would increase the market value of shares of the company. Wealth maximization is based on the concept of cash flows. Cash flows are a reality and not based on any subjective interpretation. On the other hand there are many subjective elements in the concept of profit maximization.
It considers time value of money translates cash flows occurring of different periods into a comparable value of cash flows is considered critically in all decisions as it incorporates the risk associated with the cash flow stream. About 3i Infotech 3i Infotech is one of the top 4 Indian Software Products Companies. * The company provides software products and IT services (Managed IT Services, Application Software Development & Maintenance, Payment Services, Business Intelligence, IT Consulting, BPO, Document Imaging & Digitization and Data Warehousing) for the Insurance, Banking, Capital Markets, Mutual Funds and Government verticals.
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The company services customers in over 50 countries across 5 continents. FINANCIAL HIGHLIGHTS Consolidated results for the year ended March 31, 2008 1. Revenue for the year was Rs. 1224 crores, representing a year on year growth of 82. 4 %, of which organic growth is 37. 9% and inorganic growth is 44. 5%. 2. Profit after tax and before minority interest which stood at Rs. 183 crores grew by 75. 3% over the previous year and represents a net margin of 14. 9% 3. Basic Earnings per share (EPS) increased to Rs. 13. 40 from Rs. 8. 9** in the previous year, representing a growth of 49. 1%. Consolidated results for the quarter ended March 31, 2008 1. Revenue for the quarter was Rs. 352 crores, representing a sequential growth over the previous quarter of 8. 9% and a growth of 66. 9% from the corresponding quarter of the previous year. 2. Profit after tax and before minority interest which stood at Rs. 50. 2 crores grew by 56. 9% over the corresponding quarter of the previous year and represents a net margin of 14. 3% 3. Basic Earnings per share (EPS) increased to Rs. 3. 1 from Rs. 2. 86** in the same quarter of the previous year. DIVIDEND: The Board has recommended an equity dividend of Rs. 1. 50 per share of face value of Rs. 10 each. OUTLOOK FOR THE YEAR 2008 – 09: For the year 2008 – 09, the Company estimates revenues at around Rs. 1700 crores (about 40% over FY2007-08) with fully diluted EPS of between Rs. 13. 00 – Rs. 13. 50. (as against Rs. 10. 25 in FY2007-08) BUSINESS HIGHLIGHTS FOR THE QUARTER ENDED MARCH 31, 2008 1. The Company signed a memorandum of understanding with China’s Yucheng Technologies Ltd. a leading provider of IT solutions and services to Chinese banks and financial services companies, to set up a 51:49 Joint Venture in the Peoples Republic of China. Synergies between the two companies will be leveraged to provide 3i Infotech’s award winning BFSI products and related services to BFSI entities in China. 2. The Company partnered with Union Bank of India to implement Anti Money Laundering initiative. 3. Kastle Lending Solution is being deployed by one of the oldest and 3rd largest Bank in Singapore with assets exceeding USD 125 billion. . Three leading Banks in South Asia have gone in for AML products and Kastle suite. 5. J&B Software secured new business wins for providing enterprise wide payment processing solution to a major media and television company and check and accounts payable transaction processing solution to a transportation company. 6. Premia won a multi million dollar order from a company specializing in internet based alternate delivery channels for distribution of its wide range of Insurance Products. 7.
A Washington DC based leading provider of insurance for expatriates, international schools, multinational businesses & relief organizations selected 3i Infotech’s Premia product. 8. A Utah based Managing General Underwriter company focused on providing specialized insurance solutions for physicians and employer groups also selected Premia product. 9. One of the oldest and most prestigious investment banks in Kenya selected 3i Infotech’s MFUND suite solution integrated with iBOSS and Orion for their brokerage, investment banking, portfolio management and back office operations. 0. The Company acquired Accounting Frameworks Limited (AFL), in London. AFL is an independent provider of accounting, portfolio management and front office systems to the private equity sector. Conclusion: The mergers and acquisition and the diversification of the company are the key role which helps in maximization of the wealth. We can see that in 3i-Infotech how it created the wealth in the recent times from its different activities by Expansions in various areas of operations.
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