Date:05/05/2006 URL: http://www.thehindubusinessline.com/2006/05/05/stories/2006050504040400.htm

Back 3i Info has on its radar 5 or 6 small product firms

V.Rishi Kumar

To tap managed services business, sees scope in capital market segment

Hyderabad , May 4

Mr Amar Chintopanth, Chief Financial Officer of 3i Infotech Ltd, is a busy man evaluating about half a dozen companies, both domestic and US-based, for possible acquisitions.

3i concluded four acquisitions last fiscal, and is now armed with a kitty of Rs 300 crore, about $50 million (Rs 225 crore) of this from an FCCB issue, Mr Amar is actively pursuing the company's growth plans.

On a visit to Hyderabad, a centre which the company added last year with the acquisition of SGD Software, Mr Amar told Business Line, "Our strategy for inorganic growth has been to focus on small companies that complement our product line and enhance the role we play in the banking, financial services and capital markets."

In 2005-06, 3i acquired Innovative Business Solutions, a US-based business intelligence and security solutions company, SDG Software, engaged into anti-money laundering solution, FormulaWare, an ERP company for manufacturing vertical and Datacons, a Bangalore-based company engaged in mutual fund software.

Money laundering

"After the acquisition of SDG, we have added a range of solutions — Anti-money laundering (AML) software and know your customer (KYC) solutions. This is a rapidly growing business and given the opportunity, we expect to add about 100 people in this area to the existing 150 now," he said.

The company has a perfect blend of products and services contributing about 45:55 respectively and is focussed mainly on small and medium enterprise segment. While banking, financial services and manufacturing continued to be key focus areas, capital markets offered opportunity for growth, he explained.

MANAGED SERVICES

"Given the capability to offer end-to-end services, and the exposure we have had managing the IT and software of ICICI Bank, we are now gearing up to tap the managed services market. Indian companies and particularly banks are now thinking of managed services," he said.

"Last fiscal, we registered revenues of Rs 424 crore and a net profit of Rs 58 crore and expect to grow this by about 25-30 per cent, organically. We now have about 2,500 people spread across multiple delivery centres, and added about 400 last year and expect to add about 450-500 this year. Unlike a pure play services company, the number additions would be modest," he explained.