Bangalore based OFS Technologies Limited, that debuted on BSE-SME exchange on January 14, is planning to use its IPO proceeds for an acquisition either in India or Europe, subsequently adding few more clients in its kitty.

Speaking to SMEpost.com, OFS Technologies’ Company Secretary, Manival Kumarasamy, said, “We are expecting to get about 4.25 crore from the IPO. We are planning to add another 1.75 crore from our internal accruals and will try acquire firms who work in our verticals”.

Acquisition will also result in getting existing customers of the acquired company.

He added that the company will earmark a total of Rs 6 crore for acquisition and the board will take decision before the acquisition is finalised.

During the last financial year, the company earned a foreign exchange equal of Rs 264.14 lakhs and there was no outflow of foreign exchange.

The company has mentioned in its prospectus, “We currently derive our entire income from two clients. As a result of our reliance on two clients, we may face certain issues including pricing pressures”.

OFS Technologies, promoted single handedly by a first generation entrepreneur Jesudas Premkumar Sebastia, gets 90 per cent of its revenue from US market and less than 10 per cent of its revenue from India.

The company posted total revenue of Rs 46,029,961.79 and a net profit of Rs 12,567,659 during the last fiscal year ending March 31, 2105.

Mr Kumarasamy said, “We want to diversify into new markets including India. Right now we are into Banking, Food Processing, Healthcare and ERP verticals. So we are scouting out for firms who work in this area”.

The company has also mentioned in its prospectus, “We provide software development services for our clients, who typically are Independent Software Vendors (ISVs)”.

Already talks are going with few firms in India, Canada and Europe.

Acquisition will also add to the employee strength of the company that currently has only 54 full time employees in its registered and corporate offices and development centre.