First Indian BPO company EXL to go public

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First Indian BPO company EXL to go public
The initial public offering (IPO) of the first-ever Indian BPO company to file for listing on Nasdaq EXL Services is to be the size of $75 million (Rs 340 crore).

Although the price at which it will list will be determined only after the company completes its road show, it is expected to be at around $24 per share or more, depending on the market conditions.

EXL had sold 5,26,316 shares recently to Norwich Union (an Aviva company) for $12.5 million, which brings the valuation per share to a little under $24.

Market conditions being favourable, the stock is expected to be priced at least at the previous sale levels or higher, say sources.

It will also take the networth of promoters Mr Vikram Talwar, currently CEO and vice chairman, and Mr Rohit Kapoor - president, vice chairman and director, soaring to over $ 25 million each.

Some senior and mid-managers are also expected to be worth a few million dollars each post-IPO.

According to the prospectus filed by EXL with the SEC, it has notched revenues of $43.1 million for the nine months ended September 30, 2004, compared to $19.0 million for the nine months ended September 30, 2003 an increase of 126.8%.

EXL is a provider of value-added offshore business process outsourcing solutions, primarily serving the needs of Global 1000 companies in the banking, financial services and insurance segment.

EXLs largest clients are Norwich Union and Dell (including Dell Financial Services). Other clients include Allianz, Deloitte & Touche, IndyMac Bank FSB, Prudential Financial, one of the three largest US insurance companies and one of the three largest US banks.

As much as 77.4% of the companys revenues derive from the two largest clients, Norwich Union and Dell (including Dell Financial Services).

Headquartered in New York City, where most of its marketing team is located, EXLs BPO agents work out of Noida and Pune. The company has grown from 1,827 employees as of December 31, 2002, to 4,551 as of September 30, 2004.

The company expects to hire approximately 350 additional employees by the end of 2004. In addition, EXL says it is committed to investing in an operations facility outside of India by the end of 2005.

As for attrition, for the nine months ended September 30, 2004, EXLs turnover rate for employees who had been with it for more than the six-month probationary period was 17.0% for back-office BPO operations and 54.9% for non-back-office BPO operations.
 

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