Satyam's brand value rises on higher net
By siliconindia   |   Friday, 02 July 2004, 19:30 IST
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HYDERABAD: A higher net profit before tax for FY04 has resulted in a higher brand valuation for Satyam Computer Services at Rs 3,462 crore. The valuation of the company’s brand is about 28% higher than last year's estimate of Rs 2,705 crore. The adjusted profit for brand valuation is higher at Rs 578.2 crore (Rs 475.7 crore) after adding back financial charges (Rs 75 lakh) and reducing non-branded income of Rs 84.5 crore, according to the company's annual report. Yet another parameter which underlines the shareholder value — Economic Value Added (EVA) — is higher by 94% from Rs 93.8 crore to Rs 178.5 crore. EVA is the after-tax cash flow generated by a business minus the cost of the capital it has deployed to generate that cash flow. It represents real profit versus paper profit. The company’s subsidiaries, however, continued to incur losses during the year. The net loss of Satyam's BPO outfit Nipuna Services which is at Rs 21 crore, for instance, is much higher than its revenues of Rs 11.3 crore. Other subsidiaries like Satyam Asia, Satyam Europe, Satyam Manufacturing Technologies and Satyam Computer Services (Shanghai) have also incurred losses. Further, “the rollback of the H1 visa limit to 65,000 per year is a dampener for the Indian IT industry. While we are adequately equipped to overcome the effects of the reduction in the short and medium term, this may result in potential onsite wage pressures and limitations on the onsite headcount in the long term,” the report added.

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