IBS Software vetting IPO option

KOCHI, December 30, 2012







IBS Software Services is toying with the idea of an initial public offering (IPO) in end-2013 or first-half of 2014, said V. K. Mathews, Founder & Executive Chairman of the IBS group.



Talking to The Hindu here on Saturday, Mr. Mathews was optimistic that external market situation was expected to be conducive for IPO during this period.



Looking back at 2012, Mr. Mathews said it was the best for IBS in terms of business with significant wins and noteworthy implementation of IT solutions. (IBS has posted a compounded annual growth rate (CAGR) of 47.5 per cent over the last 15 years).



Starting with 55 staff at Technopark, Thiruvananthapuram, IBS has become a multi-national company, now employing over 2,000 staff, doing business from ten offices in the Americas, Europe, Asia-Pacific, the Middle East and Africa. It is a leading provider of new generation IT solutions to the global travel, transportation and logistics industries. From a start-up company in 1997, the IBS products and customised solutions today manage the mission-critical operations of major airlines, airports, oil and gas companies, seaports, cruise lines and tour operators world-wide.



IBS has acquired HBSi, a U.S.-based company in the hospitality industry. This multi-million dollar acquisition brings to IBS fold leading players in the hospitality industry, including names like Starwood, Harrahs, Raffles, Ramada, Fairmont, Expedia, Orbitz and Travelcity. IBS has made six strategic acquisitions — one acquisition in India, two in Europe, and three in the U.S. — in its 15-year history, expanding its solution portfolio to cover travel, hospitality and aircraft engineering areas.



INKS PACT WITH LUFTHANSA CARGO



Lufthansa Cargo, the third largest cargo carrier in the world, has chosen IBS solutioniCargo to manage the airlines' air cargo movement worldwide. IBS solution will replace the legacy system used by the airline for the past 30 years. IBS was selected from among 400 global solution providers after an intense selection process lasting over 18 months, Mr. Mathews pointed out. The cargo platform project will cost Lufthansa around Rs.700 crore and is one of the largest IT system deals.



Asked about the significance of the Lufthansa deal for the country, Mr. Mathews said this deal was perhaps one of the biggest IT product deals in India, and in that sense signalled the emergence of India as an IP and IT product destination, an important and inevitable goal for Indian IT industry to promote non-linear growth. This success should be positive and encouraging news for the several emerging product companies in the country.



Most of the contracts entered in to by Indian IT companies are service deals where Indian companies supply people for executing the job specified by the customers. The cheaper cost of Indian IT professionals is primarily what helps win the contract. The IBS-Lufthansa deal is different. "We are substituting value arbitrage for cost arbitrage. Here, an IT product for which an Indian company has an IP will be used by one of the largest airlines in the world to manage a mission-critical operation like movement of cargo. A global customer is using a product that is conceptualised, developed and owned by an Indian company. In one way, this signals the coming of age of the Indian IT industry," Mr. Mathews said, signing off.
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