Master.Com

Master.Com Software Limited

Issue Opens : September 11, 2000 Issue Price: Rs.10/- per share (FV - Rs. 10/-) Issue Size: 25,00,000 shares amounting to Rs.250 lakhs Registrars to the Issue: Aarthi Consultants Pvt. Ltd.	Issue Closes: September 15, 2000 Minimum Application: 200 shares @ Rs.5/- each Post-issue promoter’s stake: 35.93% Lead Managers: Ashika Credit Capital Ltd.
Recommendation : Above Average

Listing on: Ahmedabad, Hyderabad, Calcutta and Pune Stock Exchanges

Executive Summary

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Business

Industry Scenario

Financials

Project Analysis

Critical Success Factors

Competitive Position

Market Scenario

Recommendation

Business

The Company was incorporated in April 2000 as Master.Com Software Ltd (MCSL). The Company proposes to provide various services in the field of Information technology such as E-Commerce solutions, product development related to E-Com, ASP using Internet, Offshore and On-Site project Maintenance services, HR-Consultancy and Training. The company is also focussing on web-enabling of ERP services.

Dr. B. Manjari (MBBS) has an interest in Information Technology sector and has gained adequate knowledge in the field. She has wide contacts in USA and UK in IT Industry. She had been to USA to study on the working of IT Companies in 2000.

Mr. M. Sreekiran (B.Tech and PG Diploma in Systems Design) has experience in IT industry for a period of 10 years both in hardware and software segments. He had worked with Commercial Auto Products, Lucknow as a Quality control engineer. He also worked in various other organizations. In 1998-99, he promoted Master.Com, engaged in imparting training and undertaking job works in addition to product development using Oracle Designer and Oracle Developer 2000.

Mr. B. Sreekalyan (B.Tech), has an experience of around 5 years in information technology. His core competency is in areas like HTML Designing, lay Out management, Content Development and other Internet related areas.

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Industry Scenario

Companies tapping the market of web enabling of ERP are increasing in number. The ERP solutions of big companies are handled by the big players in the IT sector. Similarly, smaller ERP solutions are provided by small IT companies. However, competition in this sector is increasing at a very fast rate, and only well-established firms, with good contacts are likely to succeed.

As regards the business of manpower placements abroad, it is one of high remunerative businesses. However, no company can survive in the long run with exclusive dependence on the revenue generated from this business segment.

The key to success in the IT field is product development, idea generation and building USPs.

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Financials

Master.com was incorporated in April 2000. The projections for the two years ending March 2001 and March 2002 are as follows:

Key Financials
Particulars (in Rs. lakhs)	2001	2002
Total Income	574.46	670.21
Net Profit	132.94	148.9

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Project Analysis

The company is focussing on tapping the overseas market by building on the contacts of the promoters, which they have built during their past ventures. Master.Com is setting up a marketing office in the US presently.

Particulars	Cost (in Rs. Lakhs)
Plant & Machinery:
(i)Hardware (ii)Software	149.32 93.55
Electrification	14.00
Furniture & Fixtures	14.28
Misc. Fixed Assets	27.85
Preliminary & Pre-Operative Expenses	55.00
Overseas Office Establishment	126.00
Public issue expenses	23
Deposits	18
Working Capital Finance	79
Total	600.00

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Critical Success Factors

Master.Com Software Limited has strategic tie-up with Lucent Professionals, Inc. and Dolphin Information Solutions, Inc. USA. With alliance partners in place, Master.Com Software Limited likes to concentrate on onsite consultancy in areas like Java, EJB, Digital Certification, DHTML, XML and Multimedia & Animation skill set requirements.

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Competitive Position

The company is newly established and hence does not have a very strong hold of the market either domestically or at the international level. The size of the company is also very small both in terms of capital as well as manpower. At present, the company's competitive position is weak. However, there is likely to be substantial improvement in the same in the near future.

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Market Scenario

The primary market had witnessed a boom at the beginning of this year when many companies came out with public issues at high premiums. The market has however now learnt to identify the good and high growth companies from the entire lot. While companies offering at par are still sailing through, the ones charging a premium need to be more careful. Companies like SIP Technologies have called off their IPOs due to poor response.

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Recommendation

The company is newly incorporated and is estimating its total income to cross Rs.5 crore in the first year itself, which does not sound very reasonable. The revenue is mainly dependent on the contract with Dolphin Information Solutions, Inc. The company has a tie-up with Lucent Professionals, which is mainly for manpower placement. The revenues are likely to get accrued only December 2000. Overall, investors are advised to be alert and careful in investing in the scrip.

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