Fundamenal Delivery Picks

KLG Systel Ltd
(A Power Player)
Company Background
The roots of KLG Systel Limited (KLG), which went public in 1994, are more than two decades old. It has been providing services to different verticals in the manufacturing industries and utilities. In this process KLG started developing products for Power Discom’s. Their products namely Vidushi, SG61, Connectgaia.com cater to Discom’s as well as industry. These products enable demand management and conservation of energy. Of late the growth is being driven by power sector and sales to power sector stand at 65% in FY07 and is growing further.

Business Model
The Company has expertise in various domains. Currently the company is catering to sectors such as Engineering and Construction, Infrastructure, Oil and Gas and Power. The company has successfully completed many projects in Oil and Gas sector. It has an esteemed clientele that include Reliance Petroleum Ltd, L&T, Tata Project, SAIL, Alstom Projects India, and DLF etc. KLG Systel is also in Life Sciences solution business and has completed successfully many important projects.
The company has recently de-merged its Power System Solutions (PSS) line of business to its subsidiary KLG Power Ltd. Post this, KLG Power Ltd has procured an unsecured loan of Rs 200 Crores, at an interest rate of 9.5%, from TPG Growth India Ltd. The loan is compulsorily convertible upto 20% holding on diluted basis on the date of conversion in KLG Power Ltd.
KLG Systel Ltd derives all its business from the domestic market and thus is immune to currency fluctuations arising out of forex exposure.


Bartronics India Ltd (BIL)
Company Background
Incorporated in 1990, Bartronics is a Hyderabad based company that started with providing solutions in AIDC that includes Bar Coding having application in the area of inventory management, sales over retail counter, supply chain management and attendance recording. BIL has recently expanded into the business of RFDC (Radio Frequency Data Communication), RFID tags, Smart Cards, Point of Sale (POS) unit targeted at the retail market. BIL has 10-distribution center spread in India and 5 overseas offices. BIL canboast of an impressive clientele and servicing some of the leading manufacture of the country. BIL offers consulting services, design, software, hardware, customization and full implementation of integrated and tailor-made AIDC- and RFID-based systems. The company also provides business and technology strategy,
systems design and architecture, applications implementation, network and systems integration in this field.

Business Model
Incorporated in 1990, BIL started developing and marketing bar codes, one of the oldest AIDC
technologies. From the bar-coding segment, BIL forayed into other advance areas of the AIDC technology
Biometrics and RFID. BIL expertise lies in providing a total barcode solution together with system integration, which has applications in areas such as inventory management, attendance recording, dispatch management and sales over retail counter etc. With the advent of the RFID/RFDC revolution, BIL diversified into the same. RFID is a technology that holds tremendous potential and BIL is certainly in a position to leverage on its expertise; this being its core area. By venturing into RFDC which has application in automated plants, BIL was able to target upcoming manufacturing units as well as existing plants upgrading their manufacturing facilities.


Tulip IT Services Ltd
(Network Integration and IP/VPN Player)
Company profile
Tulip IT Services Ltd. initiated business operations in November 1992, as a company primarily trading in software products. Tulip has been widening their range of services and has seen tremendous growth. Tulip today offers an unparalleled MPLS based network, offering wireless based Last-Mile connectivity in 650 cities in India. Tulip has been awarded the NLD license (National Long Distance) and ILD license (International Long Distance) by the Department of Telecom (DoT). Tulip has been focusing on Wide Area Network (WAN) since 2003.
Business Model of company Traditionally the company has been in the business of Network Integration (NI) providing services like network design, H/W supplies, project management, integration and implementation and post implementation network management.. The growth in the network integration business is driven primarily from segments, viz., banking, finance & insurance companies, telecom service providers, BPO, manufacturing companies and government initiatives. The development of new techniques for delivering Virtual Private Network (VPN) services over public networks continues to be one of the most active areas of innovation in communications. A VPN as a private data network makes use of the public telecommunication infrastructure, maintaining privacy through the use of tunneling protocol and security procedures. The main purpose of a VPN is to provide customers virtually similar capabilities as private leased lines at much lower cost by using the shared public infrastructure. In other words, a Virtual Private Network will allow users at remote locations to access a secured private network virtually from any location without installing expensive leased or private lines.
Earlier, users at remote locations were not able to access the secure networks using shared Internet connections owing to security concerns. The company business model is one of hybrid with two principal lines of business: -
- Network Integration and management services.
- Corporate Network and data services i.e. IP/VPN wireless connectivity.
In view of its Hybrid business model in the year 2005-06,company rolled out largest wireless based
IP/VPN network covering 350 cities and upgraded its network to Multi Protocol Label Switching (MPLS) enabled Network.
The addition of IP/VPN wireless network allows the company to further consolidate its strength as network integrator through providing total network solutions – from the design and development stage, to remotely.
business. This business will also allow it to participate in the growing VPN market for corporate with
existing networks.
Services Provided
A list of services provided by the company is as follows: -
• Network Integration
As part of network integration services, company design and develop networks for their clients. Further, company assist clients by identifying and providing equipment for their networks, integrating and
implementing their network rollouts, and providing post-implementation network management and maintenance services. The company has also started providing remote management services through its network operation centers, thereby providing significant cost and space savings to clients.
• Wireless:
The Company provides wide range of point to point and point to multi-point wireless applications, including products for backhaul from 4E1 to 1 GB and access products at 4MBPS.
• Networking:
The Company has established strong presence in networking and over the years have developed expertise
in designing and implementing local and wide area networks.
• Services:
The Company provide facility management, network management and security services to leading Indian corporate. With a countrywide presence in 70 cities, it is able to provide a single window for countrywide support.
• Rural Connectivity:
Rural Connect is its offering targeted at state Governments and agencies to provide internet/data connectivity in rural areas. The Government of India has allocated Rs. 3334 Crores for such networks, to be spent over the next 5 years. Tulip IT is aggressively looking on this opportunity and in the process of bidding for such contracts.
• Corporate Network/Data Services (Tulip Connect):
During the financial year 2005-06 Tulip IT has launched Internet Protocol based Virtual Private Network, with last mile on wireless connectivity business. It provides inter-city and intra-city data connectivity specifically to corporate clients based on a hybrid strategy. Inter-city connectivity is provided through leased lines and fiber optic cables from multiple service providers. Intra-city connectivity is provided wirelessly through its own network.
The company derives most of it revenues from the domestic market.