i-flex continues on its winning streak
By Pradeep Rane | 17 Dec 2003
i-flex has added 23 new product clients in the past six months — the highest in any 6-month period. It had an order backlog of US $36m (contracted but unbilled license revenue) as of end-September 2003, strengthening its presence in the global software product arena. Product-based revenues account for about 65 per cent of i-flex's consolidated revenues. It is the only Indian company deriving a significant portion (55 per cent) of product revenues from developed markets such as USA, Europe and Japan.
For product business, profitability in the US and European markets is expected to be significantly higher than in the developing ones, discloses a report by Enam Securities. "The product business is at an inflection point as i-flex has invested significantly in product development and marketing/sales infrastructure," the report said.
With aggressive marketing and sales investment in USA, Europe and Japan, the proportion of revenues from developed markets is expected to grow at a higher pace. "We believe i-flex is ahead of domestic competition TCS, Infosys and Polaris in the product space," Enam Securities said.
i-flex's order backlog (contracted but unbilled revenues) grew from US $34.3m in June 03 to $35.9m in Sep 03. The company expects a substantial increase in demand for packaged software in the banking vertical owing to increased IT budgets after nearly three years of expenditures having been frozen and a spate of consolidations in the industry, forcing banks to upgrade operating platforms.
Also, the new regulatory changes to monitor money laundering and Basel II norms for risk management are forcing banks to upgrade the platforms or add new features will stand I-flex in good stead. i-flex already has a framework (Reveleus Basel II) which enables compliance with Basel II risk management requirements as specified by the Bank for International Settlements (BIS). i-flex has already executed a project for a German Bank to incorporate changes required under Basel II norms and has won two new assignments for similar projects. This is likely to act as a good referral for winning future business for I-flex.
i-flex has a competitive edge in the form of a comprehensive banking product catering to all segments (retail, corporate and investment banking), a modular structure of products and relatively low cost implementation. Citigroup has chosen Flexcube platform for its corporate bank on a global basis and is implementing
Flexcube in about 100 countries. i-flex has already implemented Flexcube at Citigroup in about 40 countries. Citigroup implementation is expected to continue for the next 7-8 quarters.
