3i Infotech Ltd Management Discussions.

The management discussion and financial analysis is based on the consolidated financial statements prepared in accordance with the Generally Accepted Accounting Principles (GAAP) and in compliance with the Indian Accounting Standards (Ind AS).


As per Forrester, global tech investment was flat in the pandemic recession of 2020 but will bounce back to 6.5% growth in 2021 and 2022, driven primarily by softwares expected 10% growth in both years. The largest tech markets, China and the US, are experiencing rapid economic recoveries and will account for 56% of tech investment growth in 2021 as other regions lag due to lingering recessions from continued or resurgent COVID-19 cases. Asian and European tech markets are also caught in the crossfire between the US and China over technology protectionism. Over the next decade, software, tech services, and the availability of tech workers with advanced digital skills will drive tech market growth. Global tech purchases will grow by a solid 6.5% in 2021.

The compounded annual growth rate of technology purchases from 2019 to 2022 in Asia Pacific (APAC) and North America will outpace that of other regions. The largest tech markets, China and the US, are experiencing rapid economic recoveries and will account for 56% of tech investment growth in 2021. In most countries, economic growth in 2021 will erase the declines in 2020.Europe was one of the regions most affected by the decline in tech investment in 2020.Strong demand for telecom services in the Middle East and Africa will help the region return to growth in 2021. Latin America will see tech spending grow in local currency terms, but a resurgent pandemic will keep 2022 investment levels below 2019.

Tech services and software will drive tech market growth over the next decade, powered by tech workers with advanced digital skills. However, COVID-19 has increased protectionism, as countries have realized how much they depend on companies in other countries for drugs, vaccines, medical equipment, and technology.US trade tensions with China and other international frictions make tech collaboration more challenging.


3i Infotech (Company) was incorporated in 1993 as a wholly owned subsidiary of ICICI Limited. ICICI Limited was merged with ICICI Bank with effect from March 29, 2002. The Company began functioning as a back-office processing company for ICICI/ICICI Bank, certain of their subsidiaries and affiliates. In 1999 technology initiatives across ICICI/ICICI Bank, certain of their subsidiaries and affiliates were consolidated under the Company. Additionally, in order to leverage the expertise derived by servicing ICICI Limited /ICICI Bank, certain of their subsidiaries and affiliates, the Company made an entry into information technology services business in late 1999 by providing: (i) software development and services; (ii) IT infrastructure and network management; and (iii) IT enabled BPO services. In March 2002, ICICI divested majority of 3i Infotech Equity Shares, by virtue of which we ceased to be a subsidiary of ICICI Limited.

In 2005, the company had changed its name from ICICI Infotech Ltd. to 3i Infotech Ltd. The new company filed red herring prospectus with SEBI for IPO. The IPO of the company, which closed on April 4, 2005, was subscribed by more than six times. It received more than 1.72 lakh applications accounting for a total demand of over 12.1 crore shares. The institutional portion was subscribed 5.16 times, with a total demand for over 5.05 crore shares. Between 2006 to 2010, the company opened product development center at Kochi, launched Technology Centre of Excellence forming partnership with Oracle, launched Global Development Centre (GDC) in Chennai and also acquired majority stake in Fineng Solutions Pvt Ltd & Delta Services.

During 2011-12, especially by the end of second quarter of the year, due to global economic slowdown when the business environment was gloomy, the bankers were also adopting conservative approach for funding the refinancings. As a result of this, the Company started facing liquidity crunch and it was not able to fulfill some of its repayment obligations. In order to overcome debt repayment obligations, the company made a reference to the Corporate Debt Restructuring (CDR) cell on December 28, 2011 for restructuring of the debts of the Company through CDR Mechanism envisaged under the Reserve Bank of India (RBI) guidelines dated August 23, 2001 and subsequent amendments thereto. The final restructuring package was approved by CDR empowered group on March 16, 2012. The Master Restructuring Agreement was signed with the lenders participating in the CDR package ("CDR Lenders") on March 30, 2012.

In 2016, the company approved another CDR scheme for waiver of all unpaid interest dues from 1 April 2014 till 31 March 2016, including liquidated damages & penal interest. If there is any shortfall in servicing of interest/ unpaid interest till 31 March 31 2014, the lenders would be allotted equity shares of the company at face value towards the shortfall amount unpaid amount. The lenders have also approved conversion of 35% of the debt into non-convertible redeemable preference shares, with a coupon rate of 0.10% and maturity of 10 years. Further, the lenders approved conversion of 40% of the debt into equity shares of the company at face value of Rs 10 each and retention of balance 25% net debt with elongated repayment schedule and revised interest rate. The companys board had submitted the CDR to the lenders on 7 December 2015. The company issued the letter of approval dated 14 June 2016.

In same period, 3i Infotech bagged the "Best Innovative IT Company Of The Year" award, re-launched Orion ERP in India and showcased advanced BFSI solutions at the Connect Expo positioning itself among the 20 Most Promising ERP Solution Providers 2016.

In 2020, the Board of Directors of the 3i Infotech ("Board"), at its meeting held on December 28, 2020, and the shareholders of the Company, vide postal ballot concluded on February 28, 2021, have approved slump sale of global software products business on a going concern basis -

a) sale of the global software products business carried on by the Company and its subsidiaries in India and across the world to Azentio Software Private Limited, India, Azentio Software Private Limited, Singapore ("Azentio Singapore") and Azentio Singapores subsidiaries in the relevant jurisdictions (collectively "Azentio"), as a going concern and on a "slump sale" (as defined under section 2(42C) of the Income Tax Act, 1961) basis, on an "as is where is" basis, without values being assigned to individual assets and liabilities; and

b) the Companys intellectual property rights relating solely to the Product Business outside India, on an "as is where is" basis to Azentio Singapore.

The Company executed inter alia business transfer agreements (BTA) with Azentio Software Private Limited on December 28, 2020 towards this transaction. Aggregate consideration for the aforesaid transaction is INR 1,000.20 Crores (Indian Rupees One Thousand Crores Twenty Lakhs). The slump sale has been completed on March 31, 2021, except for subsidiaries in Saudi Arabia and Thailand where regulatory approvals were yet to be received.

The buyer is Azentio Software Private Limited alongwith its parent and fellow subsidiaries (collectively "Azentio Group") worldwide. Azentio Group is wholly owned by private equity funds advised by Apax Partners. Apax Partners is an independent global partnership focused solely on long-term investment in growth companies across four global sectors: Tech & Telco, Services, Healthcare, and Consumer.

With more than 25+ years of experience, 3i Infotech become provider of IP based software solutions and information technology services in India and internationally. A comprehensive set of software solutions, coupled with a wide range of IT services, uniquely positions the Company to address the dynamic requirements of a variety of industry verticals, predominantly Banking, Financial Services, Insurance, Capital Markets and Asset & Wealth Management (BFSI). The Company also provides solutions for other verticals such as Government, Manufacturing, Distribution, Telecom, Healthcare and Retail. The Company has over 480+ clients, in more than 15+ countries.

The Companys quality certifications include ISO 9001:2015 for Business Process Outsourcing, Application Development & Maintenance Services, e-Governance, Business Intelligence & Infrastructure Management Services, ISO/IEC 27001:2013 for Data Centre Operations for Mumbai, Chennai, Bengaluru & Hyderabad locations & ISO 20000:2018 for our IT Services management process at Chennai location. 3i Infotech currently maintaining CMMi Level 3 certification and we have initiated our process of upgrading our CMMi certification from version 1.3 to 2.0 at maturity level 3 and the recertification for Development and Services across Mumbai, Chennai, Bengaluru & Hyderabad will be completed by January 2022.

3i Infotechs Global Delivery Model provides for optimal resources, to be drawn from its vast talent pool across the globe, to offer best fit solutions to customers. Our service offering model facilitates customized solutions to enable customers to undertake technology-based business transformation and reorganize in line with todays dynamic digital business environment.


After slump sale of product business from 3i Infotech, the new 3i Infotech has a new vision, mission and goals for its lines of business and overall business strategy. We believe that FY21-22 will be the period of transformation for new 3i Infotech as we are changing the structure as well as business model for creating new 3i Infotech. With the new management, on business side we have entered in three new business segments such as Digital Business Services, Digital Transformation Consulting and NextGen Business Services along with our existing Enterprise Services business. Whereas on operations side we have created new Marketing, Revenue Assurance and Strategy process to support our overall growth plan. This year we have restructured our management and also added top notch people to our team. We have hired Chief Marketing Officer, Chief Growth Officer for North America, EMEA (Europe Middle East & Africa) region, India Business Head, India Head for Business Process Services, Global Delivery Head for AAA (Application Automation Analytics) and Global Practice Head for Cloud Solutions. We consider the new 3i Infotech structure and business strategy can fuel future growth of organization in coming quarters in all major territories, creating more value for our clients and bringing business for us.

3i Infotech is at the cusp of a new growth story since restructuring started, and our aim is to be a one-stop digital transformation resource for our global clientele, with a customer-first approach and a human-centric outlook. As we step into a new decade of 5G data and technology, 3i Infotech envisions being the steady force to lead our clients into the new dawn of digital business services. We are strong advocates of the fact, that what worked for the last decade will not work in future unless we realign ourselves to a digital led transformation. We believe that the only way to do this is through the adoption of disruptive technology, whether it is - Artificial Intelligence, the Internet of Things, Machine Learning and so on to pave the way for cognitive transformation in all businesses. We are looking to Run, Grow and Build. Run with the existing services, Grow with disrupting digital and Build with a differentiator. We look to position digital inside our Altiray solution stack, work on Security as a Service (SASE). Based on a Digital and a Cloud-first approach, the new 3i Infotech a cognitive services solution-oriented company will help in accelerating technology and product startups across the ecosystem. We are creating a future where digital transformation and business process management converge, and where technology and automation execute strategies at the highest efficiency. The focus will be on value to a customer, orchestrating solutions, incubating companies that harness the power of 5G.


Our offerings are categorized as per nature of client requirements such as Enterprise Services, Digital Business Services, Digital Transformation Consulting and NextGen Business Services.

Enterprise Services business comprises Application-Automation-Analytics (AAA), Infrastructure Management Services, Business Process Services. Our Digital Business Services consists of Cloud Computing (Cloud First), Platform Solutions (BPaaS, KPaaS, GRC) and Altiray powered digital services.

We are also offering Digital Transformation Consulting for Enterprise Technology Change Management, Design Thinking, Cultural Transformation, Collaboration and Knowledge Management. Our NextGen Business services includes 5G,powered services, SASE, Edge Computing, Cognitive Computing, Internet of Things (IoT, IIoT), Cyber Security Services etc.

Over 25 years of experience across the Banking & Financial Services, Insurance & Healthcare and Government spectrum gives us an exceptional edge and puts us in a leadership position. Our long-standing understanding of industry practices across these sectors, and across the globe, helps us understand customers needs and pain points, tailor our solutions to suit their specific needs and add value to their services to their customers. In addition to this, our ongoing investment in our products and services ensures that our products retain their cutting edge. The domain expertise ensures that we identify and facilitate our customers digital transformation journey with maximum impact benefiting their business. Our engagement with industry experts and regulators keeps us abreast of market developments which reflect in our product enhancements.