SoftPro Systems Limited, a city-based software provider, will be investing $2 million (approximately Rs 9.8 crore) in its research and development (R&D) centre in Hyderabad over the next five years, according to its chairman and managing director G Bala Reddy.
“The investment will go into creating support activities for governance, risk and compliance (GRC) solutions of SoftPro’s subsidiary Cura Software Solutions, especially customised GRC platforms that conform to the regulations in other countries,” Reddy told Business Standard.
SoftPro acquired South Africa-based Cura for a structured consideration of $19 million (Rs 93.1 crore) in an all-cash deal in June this year, which includes earnouts over the next three years. Globally, GRC as a market (software, advisory, consulting and services) is pegged at $30 billion, which is projected to touch $50 billion over the next five years.
“SoftPro raised Rs 53 crore through an equity placement recently and this will be used to fund the expansion. The company’s present equity capital stands at Rs 7.6 crore,” he added.
Announcing the launch of its global product development centre in Hyderabad – which was created at an investment of $3 million (Rs 14.7 crore) – on Tuesday, Reddy said the company had hired 100 R&D professional and will add 200 more within the next six months.
“The Hyderabad centre will develop the Version-4 of Cura’s GRC software, including design, testing and internal support. Though it will act as a captive centre initially, we are looking at opportunities to develop products in other areas as well, going forward,” Reddy said.
Stating that the company had set an internal target of achieving consolidated revenues of $200 million (Rs 980 crore) in the next five years, both through organic and inorganic means, he said SoftPro’s revenues this year were projected to touch Rs 60 crore.
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“While Cura is expected to bring in Rs 50-52 crore, as against its last year’s revenues of $8 million (Rs 39.2 crore), SoftPro will contribute the rest,” Reddy said, adding that the company was currently focusing on consolidating its operations and will look at acquisitions from next year. He, however, declined to comment further.
SoftPro’s scrip plummeted 3.31 per cent to end the trade at Rs 261.05 on the BSE on Tuesday, as against the previous close of Rs 270.