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i-flex opens 2.1% above IPO price

Indian financial software maker i-flex Solutions Ltd's shares began trading at Rs 541, 2.1 per cent above its initial public offering price of Rs 530 per share.

Citigroup is the largest shareholder in i-flex with a more than 40 per cent stake.

The Bangalore-based company makes banking software products used by 330 institutions in 80 countries.

i-flex's IPO, the largest Indian tech offering in two years, opened on June 5 as tension between India and Pakistan was peaking and the nuclear-capable neighbours seemed dangerously poised on the brink of war.

The IPO, through which i-flex sold 3.96 million shares or 10 per cent of its equity, closed on June 11 and was oversubscribed 2.72 times.

Institutional investors were allotted 60 per cent of the issue, while 15 per cent went to high net-worth individuals and 25 per cent to retail investors.

The shares are listed on the Bombay Stock Exchange and National Stock Exchange.

Company profile

Despite the slowdown in IT spending by banks, i-flex, one of India's top 20 software exporters, reported a 34 percent jump in revenue to Rs 4.15 billion for the past year to March. Profit rose 15 per cent to Rs 1.27 billion.

Products accounted for 60 per cent of revenue with the balance coming from services. Other Indian software companies earn most of their income from services.

The US currently accounts for 34 per cent of i-flex's revenue and Europe about 26 per cent. Company chairman and managing director Rajesh Hukku said in late May that i-flex would be increasing its exposure to the United States and said the listing was aimed primarily at providing greater visibility.

i-flex raised Rs 2.1 billion through the IPO.

Hukku said i-flex will spend Rs 1.71 billion of that money building new software development centres and Rs 500 million on marketing. It may also buy niche software product companies to augment its portfolio.

i-flex was built by former employees of Citigroup and in addition to that company counts Japan's Shinsei Bank, UBS Warburg and the Development Bank of Singapore among its top clients. It has over 2,000 employees.

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