Ramco Systems Ltd, which has put on hold its earlier planned rights issue, plans to rope in a strategic partner to take its cloud-based products to global markets next year, according to the company's Chief Operating Officer, Mr Kamesh Ramamoorthy.

“It could possibly be an equity partner. We are yet to decide,” he said.

The Chennai-based software company last year decided against the rights issue and managed with the available funds. However, next year, it is to launch its products in the US and Asian markets like Singapore for which it will raise funds, which could be nearly 20 per cent of the revenue. The funds will be used for partnerships, brand building, working with research firms and attracting talent abroad, he told Business Line .

Overseas expansion

First succeed in India and then go global. That's exactly what Ramco plans to do with its OnDemand Enterprise Resource Planning (ERP) product, which is a full-fledged ERP suite offered to clients on the cloud or pay per user model. Ramco will launch its cloud-based products in the US in April.

“In the past, simultaneously we launched the products in the US and Europe along with India without first proving it in the domestic market. While we got customers, it was difficult to manage and scale beyond a point. We do not want to repeat the same mistake this time,” he said. For the OnDemand ERP, Ramco focussed only on India in the last couple of years; proved the model was 100 per cent success before launching abroad.

The product has been accepted by over 200 customers in India and Ramco is getting around 50 customers every quarter as against 15 a quarter during last year. Ramco will now launch the product first in the US, which is a matured ERP market, and then in Singapore, Malaysia and the Philippines, he said.

A company pays a monthly fee of Rs 6,500 per user to use the product. While there is an implementation cost of Rs 5 lakh for small companies, there is no maintenance or software upgrade cost. Around 3,500 users are using the product, said Mr Ramamoorthy, who is confident of achieving 5,000 users by March end.

Target companies

Ramco first thought smaller companies of around Rs 300 crore and less could be the ones interested in buying the OnDemand ERP because buying a full suite of the traditional ERP was very costly. However, Ramco found that even larger companies such as the Sujana Steel, which is an Rs 5,000 crore company, were interested in buying the product.

Today, nearly 20 per cent of its clients are large companies, which buy the product not just for affordability but to get rid of the pain of managing an ERP with a large team.

Better performance

Mr Ramamoorthy said the company's performance this financial year will be better than last year. “To breakeven, we require around $50 million a year and we are on track to achieve it. We are more confident than in the past of better financials.”

Ramco's stock on the Bombay Stock Exchange closed at Rs 59.25, down by Rs 3.15 or 5.05 per cent over the previous day's closing price.

> raja@thehindu.co.in

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