3C IT Solutions & Telecoms (India) coming with IPO to raise Rs 11.44 crore

3C IT Solutions & Telecoms (India)

• 3C IT Solutions & Telecoms (India) is coming out with an initial public offering (IPO) of 22,00,000 equity shares of face value of Rs 5 each for cash at a fixed price of Rs 52 per equity share. 
• The issue will open for subscription on June 4, 2024 and will close on June 7, 2024.
• The shares will be listed on BSE SME Platform.
• The share is priced at 10.40 times higher to its face value of Rs 5.
• Book running lead manager to the issue is KREO Capital.
• Compliance Officer for the issue is Laxmi Tiwari.

Profile of the company

3C IT Solutions & Telecoms (India) (3C IT Solution) is in the business of IT systems integration, operating for the past 8 years. It specializes in end-to-end IT integration solutions covering Power Management to Data Centers and everything in between. At 3C IT, it offers outstanding system integration services through highly-valued partnerships and proven expertise. System integration is not merely a technical process and has a strong impact on the core business as well as its people. For a holistic and seamless expansion of the current IT setup, 3C IT works with client organizations in evaluating the existing systems, locating the problems and finally building a system integration solution that is futuristic, cost-efficient and the best in performance. 

The Company operates with a vision to provide competitive IT system integration capabilities endeavouring to use best-in-class technologies and hence bring significant value to the stakeholders. It aims to create a well-respected, highly skilled, and professional workforce that can serve the diverse technology needs of the businesses as its service portfolio comprises several IT-related services which cater to the needs of its customers. The company offers security consolidation solutions focus on eliminating configuration clutter and also bring down the overall cost by cutting down operational expenses, licensing costs and management overheads. From firewall assessments to using a UTM platform, it delivers resilient business benefits and increased cost savings. Its service offerings are spread across the spectrum of various IT products and services bifurcated under 3 segments i.e. Infrastructure solutions, Digital business solutions, and Consulting solutions to meet its client requirements. 

As an ISO 9001:2015 certified Company, it offers innovative solutions which cater the technological requirements of its clientele. Collaborating closely with its clients, it forges strategies to augment their existing business framework and prepare them for forthcoming challenges. At 3C IT Solutions, it helps customers to enhance their business practices by leveraging its extensive industry knowledge, technological expertise, and a comprehensive portfolio of services, all tailored to specific segments. Its industry experience, the skillset of its resources and technical expertise enables it to deliver desired results to its clients. The company stands as a steadfast partner in business’ transformational journey, adapt at identifying new growth prospects and facilitating ventures into new sectors and markets. It focuses on client satisfaction and prioritizes customer experience. It offerings address the IT infrastructure, and IT portfolio requirements of its customers. The company provides customised IT solutions to various sectors such as pharmaceutical, education, banking, manufacturing, and healthcare.

Proceed is being used for:

• Funding working capital requirements of the Company
• Repayment/ prepayment of certain borrowings availed by the Company
• General corporate purposes

Industry overview

Over the past year, India has shown resilience and continues to be the fastest-growing large economy in the world. Similarly, the country’s technology industry has also exhibited continued revenue growth and is expected to grow double digits in constant currency terms in FY2023E. India’s massive digital infrastructure also played a key role in driving India’s domestic tech adoption. With continued investments by the government and enterprises in emerging technologies, India’s domestic sector emerged as the great propeller. Domestic revenue is growing 13% from FY22 in rupee terms, with a significant uptick in digital spending amongst Indian enterprises

In recent years, India has emerged as a global powerhouse for deeptech innovation capabilities & R&D and is steadfastly committed to ushering future growth and innovation for global enterprises. Global Capability Centres (GCCs) have had a huge impact in making India a destination of choice for Engineering R&D. 40% of global GCCs are present in the country today which demonstrates a tremendous opportunity for the country to scale up. India added 65 plus new GCCs in the year taking the total to 1570 plus. Sub-sectors such as ER&D also witnessed an accelerated double growth at 11.1%

India is the topmost offshoring destination for IT companies across the world. Having proven its capabilities in delivering both on-shore and off-shore services to global clients, emerging technologies now offer an entire new gamut of opportunities for top IT firms in India. The Indian IT & business services industry is expected to grow to $19.93 billion by 2025. Spending on information technology in India is expected to reach $144 billion in 2023. By 2026, widespread cloud utilisation can provide employment opportunities to 14 million people and add $380 billion to India's GDP. 

Pros and strengths

Tailored IT services: 3C IT Solution takes pride in offering custom IT solutions. It understands that each business is unique, facing specific challenges and demands. Its IT solutions are tailored to address organization’s distinct needs, providing a strategic advantage in the dynamic digital landscape. The holistic approach of 3C IT Solution addresses the multifaceted nature of cybersecurity. Instead of prescribing a one-size-fits-all solution, it collaborates with organization to tailor its services, including custom IT solutions, to meet specific challenges. Its goal is to empower organizations to navigate the digital landscape confidently, knowing that they have a robust defence against a diverse range of cyber threats. Education is another pillar of its approach. Beyond the technical aspects, 3C IT Solution emphasizes user education as a crucial line of defense against cyber threats.

Quality of services: The company has been accredited with ‘ISO 9001:2015’ certification for Design and Development of Application Software, Web Applications and Managed IT Services. It adheres to quality standards as per industry standards; hence it gets repetitive work order from its customers, as it is capable of meeting their quality standards at competitive costs, which enables it to maintain its brand image in the market.

Customer Relationship: It constantly tries to address its customers’ needs. It tries to provide a tailor-made specification according to their requirements. Its existing customer relationships help it to get continuous business from its customers. This has helped it to maintain a long-term working relationship with its customers and improve its customer retention strategy.

Risks and concerns

Revenue is dependent on domestic market: Its revenue is dependent on sales of products and services in domestic market i.e. in India only. It does not have any business presence or revenue from any other country. In the event of any slowdown in domestic market, or any developments that make its products or services less attractive in domestic market, it may experience more pronounced effects on it business, results of operations, and financial condition than if it had further diversified revenue across different geographical locations. Its business, results of operations and financial condition have been and will continue to be largely dependent on the prevailing domestic market conditions and any adverse changes in the conditions affecting domestic market related to its business operation, may adversely affect its business, results of operations and financial conditions.

Any IT system failures may lead to operational interruption: The success of its businesses depends in part upon its ability to effectively deploy, implement and use information technology systems and advanced technology initiatives in a cost effective and timely basis. Its information technology systems include CRM systems that allocate resources and facilitate internal and external communications, enabling it to coordinate and make quick decisions across its business. Its computer networks may be vulnerable to unauthorized access, computer hacking, computer viruses, worms, malicious applications and other security problems caused by unauthorized access to, or improper use of, systems by its employees, subcontractors or third-party vendors. Any systems failure or security breach or lapse on its part or on the part of its employees and other ecosystem participants that results in the release of user data could harm its reputation and brand and, consequently, its business, in addition to exposing it to potential legal liability. Any such legal proceedings or actions may subject it to significant penalties and negative publicity, require it to change its business practices, increase its costs and severely disrupt its business.

Delays or non-payment by clients: It is exposed to counter party credit risk in the usual course of its business dealings with its clients or other counterparties who may delay or fail to make payments or perform their other contractual obligations. The financial condition of its clients, business partners, suppliers and other counterparties may be affected by the performance of their business which may be impacted by several factors including general economic conditions. It cannot assure of the continued viability of its counterparties or that it will accurately assess their creditworthiness. It also cannot assure that it will be able to collect the whole or any part of any overdue payments. Any material non-payment or nonperformance by its clients, business partners, suppliers or other counterparties could affect its financial condition, results of Operations and cash flows.

Outlook

3C IT Solutions & Telecoms (India) is in the business of IT systems integration, operating for the past 8 years. It provides customized IT solutions to sectors such as pharmaceutical, education, banking, manufacturing, and healthcare. As an ISO 9001:2015 certified Company, it offers solutions which cater the technological requirements of its clientele. It has been awarded a certificate of recognition from the Department of Promotion of Industry and Internal Trade as a start-up in ‘IT Services’ and 'IT Management’. It aims to expand project sizes and numbers while broadening service offerings. On the concern side, it operates in a competitive environment where it faces competition from other companies that operate within the same geographic region as it does. Its competitors may have superior financial and other resources, which may provide them with a competitive advantage. The factors that determine the level of competition it faces include the type, value, complexity and location of the project, as well as risks relating to revenue generation.

The company is coming out with an IPO of 22,00,000 equity shares of face value of Rs 5 each for cash at a fixed price of Rs 52 per equity share to mobilize Rs 11.44 crore. On performance front, revenue from operations has reduced by Rs 492.10 lakh that is a reduction of 7.36% from previous year. Revenue from operations was Rs 6193.36 lakh in the fiscal year ended March 31, 2023 and Rs 6685.46 lakh in the fiscal year ended March 31, 2022. Net profit after tax has increased by Rs 2.72 lakh which is an increase of 2.45%. It has increased to Rs 113.62 lakh in the fiscal year ended March 31, 2023 from Rs 110.90 lakh in the fiscal year ended March 31, 2022. Meanwhile, it has devised tailored plans which align with its clients' requirements, turnaround times, and industry standards. This strategic approach enhances the efficiency of its service offerings. These plans are not only innovative but also adaptable to the evolving needs and trends in the market. It aims to create certified and trained resources and has its own in-house employee resources from receiving of the order to complete deployment of it.