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Caritor in expansion mode — Plans Nasdaq listing

Preeti Pandey

Bangalore , Dec. 30

GEARING up to enter the big league, IT services firm Caritor is on an expansion mode with plans to grow both organically and inorganically.

While it would invest $15 million in India and increase its team to 3,700 people by end-2005, acquisition targets are also being evaluated by the company.

"In 2005, we expect to make some announcements on acquisitions and we are looking at domain specialised firms in the US and UK to help us to grow our domain expertise in areas such as HR, pharmaceuticals and auto industries as also firms that have specialisation in SAP implementation," Mr Raja Sekharan S.G., Vice-President (Sales) of Caritor (India) Pvt Ltd, said.

While Caritor is cash-rich with estimated revenues for financial year 2004 (Jan-Dec) at $85-88 million, the company expects to fund its acquisition through a back-end tie up with external investors.

"Although we have not worked out details we expect to divest some stake to external financial institution(s) once we have the acquisition tied up," Mr Sekharan told Business Line.

The acquisition would also help Caritor become a $200-million company by 2006 and support its strategy of an overseas listing, "preferably on the Nasdaq. With estimated 50 per cent growth we should finish next year with close to $130-135 million in revenues," he said. Having invested close to $11 million in India during the last two years, the sub-continent prominently figures on the company's roadmap to step into the Tier I category with plans to open new development centres in Bangalore and Chennai.

While Caritor has both SAP and PeopleSoft practice as part of its business application service, the company is bullish on the SAP implementation stream in spite of the PeopleSoft-Oracle merger.

"Our existing customers on PeopleSoft have made commitments to stick to the application but we expect clients to migrate later and 15 new customers were added this year on the SAP front," according to Mr Sekharan.

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