i-flex Solutions is attracting buying interest on a slew of positive developments despite overall weakness in frontline tech stocks.

From a recent low of Rs 799 touched on 12 February, the i-flex stock has risen nearly 5% to Rs 838.50 on 14 February, touching a high of Rs 899 in the intra-day trades. The BSE IT Sector Index has shed nearly 1% in the same period.

The performance of the company has been reasonable over the last few months. From its low of Rs 433.05 touched on 29 July 2002, the i-flex stock had risen to its all-time high of Rs 938 on 20 January 2003. After dipping to a low of Rs 785 on 27 January 2003, the stock has recovered once again on renewed buying interest.

The buying on the i-flex Solutions counter on Friday was attributed to reports that the company has bagged a $200-million order from Citigroup. It may be noted that Citigroup, the global financial services company, has a 43.2% stake in the software major.

According to reports, this is the largest software project awarded to an Indian software services company till date. The contract will run till 2005-end. Citigroup plans to implement i-flex's banking software product, Flexcube, in more than 93 countries.

Last month, i-flex announced its third quarter ended 31 December 2002 consolidated results - a rise in net profit by 117% to Rs 59 crore compared to Rs 27.18 crore in the corresponding period of the previous year. Revenues increased 50% to Rs 174 crore (Rs 1.74 billion) from Rs 115.66 crore (Rs 1.15 billion) in DQ 2001.

An analysts poll by capitalmarket.com had expected net profit growth in the range of 39.5-64% to Rs 38-44.6 crore for the Mumbai-based software company on a 28.5-43% increase in net sales to Rs 148.6-165.6 crore (Rs 1.48 billion).

The company, which heavily depended on Citibank for business till recently, has seen its client concentration improving of late. According to a recent research report by Morgan Stanley, Citibank's contribution to revenues has decreased to 68% in DQ 2002 from 73% in SQ 2003. Its blended billing rates have moved up 3% sequentially with offshore rates moving up 5% and onsite rates dropping marginally.

i-flex is one of the few IT companies in India with a focus on IT products, deriving over 60% of its revenues from high-margin products. It is also in the business of providing solutions to the financial services industry, and its range of solutions includes packaged applications for the financial services industry, custom application software development, deployment, maintenance and support services for financial institutions, and business and IT consulting services in the financial services domain.

i-flex caters exclusively to the banking, financial services and insurance sectors. i-flex's ‘Flexcube' has been ranked among the two top selling wholesale banking back-office systems for 1999 and 2000, and among the three top selling retail banking systems in the world for 2000 by IBS. In 2001, it was ranked among the two top selling solutions in both the retail banking and the wholesale banking sales league table.

As on 31 December 2002, the promoters' holding in i-flex was 43.2%, while the public, local institutions and foreign institutions held 40.6%, 4.3% and 10.96%, respectively.

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