Indian IPO

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Thursday, August 10, 2006

Cellebrum all set to raise Rs 1000cr from market, a B K Modi-promoted company in the business of providing value-added services to most of the mobile telecom service operators in India, has decided to raise Rs 1,000 crore (Rs 10 billion) from the capital market by the next year, reports Business Standard.

The market funding will help the company to put up operations in Bangalore, Kolkata, and Mumbai; and expand the existing locations at Parwanoo and Noida.

The IPO will be preceded by a venture capital funding of Rs 150 crore (Rs 1.50 billion) (approximately) with a strategic technological partnership or an angel investor to offload 10% of the total equity by next month. The KPMG projected the valuation of the company at Rs 1,000 crore in the recent past.

The company is in the process of developing software for the community services, particularly in the area of interaction. This would be rolled out in about two months.

With the launch of this software, the telephone chat like that of a web chat would become feasible. This would be developed in association with the UK based ICE 365. The cutting-edge technology would help the company to access the European market as well.

CEO of Saket Agarwal said that the investment in research and development was the crucial investment component in this business.

The company was investing about 30% of its revenue in R&D. The future strategy of the company would be to expand capacities in R&D. The thrust would be on the developing new value added services like TV on mobile.

The growth pattern of the market for the VAS can be substantiated from the fact that grew from Rs 25 crore (Rs 250 million) to Rs 100 crore (Rs 1 billion) of annual turnover in the past two years.

Besides outsourcing to the domestic players Cellebrum has done overseas assignments in Mauritius, Indonesia and Bangladesh. The similar projects for Malaysia and Sri Lanka are in the pipeline.

With a trained manpower of 250 persons, Cellebrum happens to be the largest vertically and horizontally integrated (as it provides voice, roaming and GPRS) VAS provider. The company provided roaming to all players except for Hutchison and Airtel in India.

Cellebrum has set up a 3G technology equipped office in Singapore. This would be a dress rehearsal to prepare us for catering the 3G market when it is launched in India. Tele Malaysia is keen to partner with Cellebrum for this project.


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