IT's Finance Whizkid

The Straight Through Processing (STP) initiatives of SEBI has not only
reduced the settlement cycle to T+1, but also offered several Indian vendors
operating in financial services domain another lucrative source of revenue.
While established software majors like Infosys, TCS, and i-Flex have been prompt
in taking advantage through their STP solutions, a lesser-known Mumbai-based
company, Financial Technologies (FTIL), has apparently stolen the thunder. A Rs
12.7 crore profit on a topline of just Rs 27.6 crore in 2003-04 vindicates this
optimism. And, with the first three quarters of 2004-05 already generating Rs
24.5 crore, the juggernaut seems to be rolling on.

Unlike Infosys, TCS, and other biggies, who are primarily software companies
with domain expertise in financial services, FTIL is mainly a finance company
with strong software skills. During its decade-long existence it has developed
and deployed proven transaction automation technologies for equities, forex,
commodities and derivatives markets. This, explains director Dewang Neralla,
covers all the stages of a trade life cycle-pre-trade, trade, and post-trade
operations to deliver single point transaction fulfillment.

Smart alliances

Being an official member of the KEYSTONE alliance of Microsoft, Intel, and
Compaq has proved to be of immense benefit. KEYSTONE, which is an alliance for
the financial services industry, has spearheaded FTIL's marketing efforts in
the APAC region by leveraging the clientele and relationships of these companies
with other players in the financial services industry of the region.

FTIL is mainly a finance company with strong software skills. But it has developed and deployed proven transaction automation technologies for equities, forex, commodities and derivatives markets

Further, under its global STP partnership with OMGEO, FTIL has set up a
market-wide central messaging platform for STP services called STP-Gate. As part
of this arrangement, its FT e.Cosystem solution suite allows brokers and
investment managers to move to a full STP environment and provide local market
participants with access to OMGEO's global community of over 6,000 clients,
including leading Indian brokers. While FTIL's STP solutions has held its own
against the offerings from its much-bigger competitors, it is the
exchange-market domain that has proved to be a differentiator for FTIL.

Ruling the exchanges

In the exchanges sector, its achievements include a permanent recognition
from the Government of India for the Multi Commodity Exchange of India (MCX), a
nationwide multi-commodity exchange it set up for online futures trading. It has
also partnered with IBS-Forex to set up FXDirect, the country's first
indigenously developed electronic forex trading platform, established under the
formal mandate of the Reserve Bank of India and Foreign Exchange Dealers
Association of India (FEDAI). The latest feather in FTIL's cap was surpassing
of the 25,000-mark in live-trading desks. "Within 11 months of the launch
of the CTCL/IML technology for the commodities market, we have enabled market
participants to expand their trading network across 900 server sites in 150
cities," says Neralla with understandable pride.

Dewang Neralla, director, FTIL Within 11 months of the launch of the CTCL/IML technology for the commodities market, we have enabled market participants to expand their trading network across 900 server sites in 150 cities”

Another milestone: FTIL and MCX have formed an alliance with National
Agricultural Cooperative Marketing Federation of India (NAFED) to set up
National Spot Exchange for Agriculture Produce (NSEAP), India's first
electronic exchange for commodities markets. This national-level electronic
exchange for commodities market links all the Agriculture Produce Marketing
Cooperatives (APMCs) and other physical market players across the country. Ajit
Kumar Singh, chairman of NAFED, endorses the value proposition that NSEAP brings
to the table: "This national level electronic agriculture spot market has
enabled NAFED, FTIL and MCX in respective domains to exploit one another's
complementary competencies to the fullest so that Indian agriculture markets can
be positioned globally."

Now FTIL has arrived on foreign shores too. FTIL and MCX have formed a JV
with the Dubai Metals and Commodities Center (DMCC) to establish a commodity
market place in Dubai. This strategic initiative of the Dubai government
provides industry-specific market infrastructure and a full range of facilities
for the gold and precious metals, diamonds and colored stones, and commodities
industries including metals, softs and energy.

This alliance is also setting up another electronic commodities exchange
called Dubai Gold and Commodity Exchange (DGCX), which is expected to become
operational in the second half of 2005. Says Colin Griffith, DMCC's executive
director for the gold and precious metals sector: "Appropriately for the
City of Gold the first contract listed on the exchange will be gold, but that
will be quickly followed by other contracts in silver, steel, freight, cotton
and energy."

So far FTIL's report card shows that even the small can hold its own when
it comes to specific domains.

Rajneesh De