August 2008, www.finextra.com

NumeriX, the independent leading analytics provider for the structuring, pricing and valuation of derivatives and structured products today announced a partnership with Pyxis Systems-a provider of technology solutions and services to the global financial derivatives industry.

This groundbreaking partnership will expand integration and support services for NumeriX customers throughout AsiaPac, from Hong Kong and India.

Since establishing its Asian operations in 1998 with offices in Tokyo and Singapore-and most recently in Hong Kong-NumeriX has developed a reputation for delivering the most sophisticated analytic solutions for structuring and pricing derivative and structured product instruments, making it the solution of choice for some of the largest institutions in the region. Moreover, NumeriX's relationships with over 40 partners provide institutions the ability to build end-to-end solutions-from pre-trade structuring, through pricing, trade capture and valuation. As most financial institutions have existing relationships with many of NumeriX partners-such as Reuters, Misys and Bloomberg-potential users can seamlessly integrate NumeriX market standard analytics into their current platforms, thus expanding their current platform to support the widest range of derivative products.

Through this partnership with Pyxis, NumeriX customers in India and Southeast Asia will have enhanced regional support for training, integration and professional services, including system and market data integration. Additionally, clients will have the ability to work with the NumeriX-certified staff of Pyxis, to design and develop new instrument types and add-ins for NumeriX's Excel-based offering, NumeriX 7.

"With the explosive growth of the derivative and structured products markets, as evidenced by the opening of new markets in the region, coupled with the need to manage and navigate the troubled credit markets, there has been a significant increase in demand for NumeriX analytics," said NumeriX President and COO, Steven R. O'Hanlon. "Through our partnership with Pyxis, NumeriX now offers the largest support infrastructure of any analytics provider in the region."

"Pyxis offers Derivatives Consulting Services to banks and financial institutions with superior assistance through its experience in the derivatives and technology domain. Pyxis is working along with several large Indian and foreign banks and financial institutions, helping them set-up derivatives desk frameworks, implement derivatives systems, provide professional services and develop custom applications for front- and mid-office analytics. A Partnership with NumeriX will help Pyxis serve the high-end derivatives players across Asia," said Pyxis CEO, Nandlal Bhatkar (Johnny).

(Read the article on www.finextra.com).

 

September 2007, www.biztech2.com

Derivative trade has gained momentum since it was first launched in 1994 in India. Apart from corporate and financial institutions, a lot of individuals are now understanding and showing interest in derivatives trade. While the derivative market is growing at a rapid pace there are very few Indian companies which provide technological solutions for this extremely complex and niche financial domain.

Pyxis Systems, a Pune based company has been striving to create its dominance in the financial derivatives industry with its industry centric solutions. The company recently launched www.ionpot.com, a web-based solution for financial derivatives based on its flagship product RisKompass. Nandlal Bhatkar, founder and CEO spoke to Biztech2 about its latest offerings and other issues pertaining to the derivatives industry.

What prompted you to provide derivatives services through a web based solution, as you already have a presence in the market through your software RisKompass?
RisKompass mainly caters to large derivatives players like banks and financial institutions. It can not cater to small players as the kind of investment and number of people required for using RisKompass is huge. Large derivative players mainly use three types of derivatives software, which can be categorised as front office software, mid-office or risk management software and back office software. Each of these softwares which could cost $1 to 5 million are very complex in nature, takes a lot of time in implementation and requires a dedicated team of people. Small derivatives players may not have that many trades, number of people and budget to go for a very expensive system and Ionpot is targeted specifically towards such people.

What are the prominent features of your latest offering Ionpot?
While most of the new developments in the derivatives software market are targeted towards large derivative players, Ionpot comes in aid of the smaller players. Ionpot services are available on a subscription based model. Currently we have priced it between Rs 3.5 lakh to Rs 4 lakh per year per user. Being a web based platform, Ionpot is very easy to use and one just needs to log in the system, like operating any other email account. It provides transparency to the users and an effective mechanism on the web to price derivative deals accurately and independently in much the same way as market makers. In order to get credible data for Ionpot, we have tied up with large international and local brokers as well as banks which will help in bringing the traded market prices directly on to the platform.

What kind of services will be provided by this web portal?
Ionpot allows the user to price, save and mark-to-market various interest rates and Forex derivatives instruments. It will provide several services to the industry such as delayed market prices, details on derivatives programmes, market summary etc. This system will allow the user to capture the trades; will allow him to market it using real time data.

Apart from this, Ionpot houses a portfolio management system (Ionpot PMS) which provides real time pricing and valuation for Interest Rate and Foreign Exchange derivatives. Ionpot is powered by RisKompass and has all the functionalities of the software.

What kind of response has the solution received?
We have got very good response from the market. As of now many people are using it on a trial basis as we have just launched it. Adani Enterprises and Arvind Mills have already signed an agreement with us. We shall be signing 15 to 20 clients in the next month.

What are the major issues and challenges of derivatives software market?
Derivatives trade is a fairly complex and niche business. Several risks associated with this business such as market risk, liquidity risk, operational risk and credit risk, require complex mathematical and calculation tools. A pure IT player may not be able to provide an appropriate solution.

For a bank which may be dealing in foreign exchange, interest rate and credit derivatives, the biggest challenge will be to first identify the right system. A consultant who has been in this business can be very useful while deciding the system requirements. Implementing the system is also an issue. At Pyxis, we have a separate unit which looks after system implementation.

The knowledge both on the bank and corporate side about what derivatives are, how they are priced, how they need to be used etc has to be improved. I think there is a grave need for education and awareness among banks and corporate.

(Read the entire interview on www.biztech2.com).

 

August 2007 - Compliance, Risk & Opportunity (CRO) Journal

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Ionpot can help meet RBI Guidelines for Derivatives
December 2006, The Economic Times

Mumbai, August 22, 2007: Pyxis Systems, a provider of technology solutions and services to the global financial derivatives industry, announced the launch of Ionpot (www.ionpot.com) – the first Asian company to provide this kind of web based solution for financial derivatives. Ionpot allows the user to price, save and mark-to-market various interest rates and forex derivative instruments.

The solution is accessed via the internet using industry standard security protocols and frees the user from installing and maintaining expensive risk management infrastructure. Ionpot is powered by RisKompass, a comprehensive derivatives risk management system developed by Pyxis Systems.

This product may help the derivatives markets meet the recent RBI guidelines which states that all banks and primary dealers of derivatives should come out transparent on the pricing and expected impact of derivative transaction on the users. Also it requires the users (corporates) to be provided a calculator to mark-to-market these products on an ongoing basis. Ionpot will give market the required analytics models to price several derivatives trade.

“Ionpot is a far superior solution than just providing a valuation calculator. The valuation of the derivatives instruments not only requires model but also needs credible market data. Ionpot provides both the components. Ionpot has tied up with large international brokers like Tullet Prebone, besides local brokers and banks, to get these data. Besides this, Ionpot also allows the trades to be stored in a portfolio and gives mark-to-market value of individual trades with a click of a mouse 24X7”, said Nandlal Bhatkar, Founder & CEO of Pyxis Systems.

Some key features of Ionpot:

• Real time market data feed
• Flexible and customizable market data view
• Real time pricing for interest rate, forex derivatives and strategies
• Organization wide portfolio view, mark-to-market and analytics
• New generation interactive user interface for fast and easy operations

"Ionpot is a great & high utility product for Indian Corporates who resort to derivatives markets. It prices not only several option strategies and strips but also handles local product like Overnight Index Swaps. The live market feed for both local and international market makes it a very valuable product", said K Rajaram, Head Forex and Risk Management, Arvind Mills.

Ionpot is aggressively priced and is available on an annual subscription basis. It addresses the most common needs for a wide segment of the Indian markets (especially corporates) that are using derivatives for hedging. Ionpot is already in use by over a dozen users who started as trial users of the system.

According to RK Das, Senior VP, Treasury, Adani Enterprises Limited, “Ionpot provides the flexibility and the analytical coverage needed to accurately price many of the derivatives used by us. We are extremely happy with the intuitive user interface and the simplicity with which we can price the deal and do mark to market of the entire portfolio”.

Pyxis also offers other value added services to the users such as VaR analysis of the portfolio, hedge effectiveness calculations etc. Pyxis plans to expand the footprints of Ionpot to SE Asia and other countries in the next 1 -2 years.

About Pyxis Systems
Pyxis is a niche and focused player providing software solutions and services in the financial derivatives space. Pyxis has expertise in quantitative finance and modeling as well as knowledge of global derivatives markets, derivatives desk operations, regulatory framework and has its own derivatives risk management platform called RisKompass with analytics library. Pyxis was started in November 2004 by two IIM Ahmedabad alumni and technocrats, Nandlal Bhatkar an ex- international derivative structurer and conusltant & Sunil Nikhar, an IT entrepreneur. Pyxis is the only company in SE Asia to offer end to end solutions in derivatives space.

For further information kindly contact:

Anusuya Mitra – 9892871531
Adfactors PR
anusuya.mitra@adfactorspr.com

 

Banks Signs Agreement for derivatives risk management solution, RisKompass
December 2006, The Economic Times

Mumbai, September 21, 2006: Pyxis Systems, a provider of technology solutions to the global financial derivatives industry, announced that UTI Bank has selected RisKompass as the software solution for financial derivatives risk management. An agreement to this effect has been signed between UTI Bank and Pyxis Systems.

With UTI Bank, Pyxis Systems marks its first client for the product.

RisKompass is a state-of-the-art software system for derivatives valuation and risk management, which enable clients to manage derivative trades in a more controlled manner from the front to the back office. It is capable of handling valuation and risk management of a wide range of derivatives instruments, including structured products.

It will provide cutting-edge mathematical models and technology for managing the bank’s derivatives portfolio. Pyxis customer focus will enable the bank to customize and implement the software accurately on ongoing basis. This product offering will be further enhanced with complete after sales support from Pyxis Systems.

Speaking on the tie up Mr. Nandlal Bhatkar said that “This is the first time a comprehensive derivatives risk management solution is being provided by a local vendor. We hope that this will satisfy the long standing need of the local market. Pyxis is not only providing the product but also willing to work with the clients to provide complete solution in form of further customization / implementation of the product. Pyxis will be offering Mid Office / Back Office
related services to its clients, if the need be.”

Pyxis is the only company in the world in the derivative solution space with the full technology center based out of India, the IT hub of the world, getting benefits of the extra ordinary talent pool of professionals and mathematicians at 40% of the cost.

"We look forward to strengthening and building our client base in India and overseas market in the coming years" said Sunil Nikhar, founder and President of Pyxis Systems. "The derivatives industry globally has a rational view for investment in technology systems and this will drive demand for RisKompass, our integrated solution for derivatives. In the coming years, we expect banks to continue to invest in financial software to lower costs, mitigate operational risk, facilitate use of new asset classes and also address regulatory compliance".

Mr. R.V.S. Sridhar, Vice President - Treasury, UTI Bank said, “We selected RisKompass due to the user friendliness offered by the system. The software also offers good portfolio management features and pricing capabilities required to meet the increasingly complex requirements of customer business. It also promises smooth deal processing with checks and balances and online risk monitoring mechanism. We hope to use the software across the bank at multiple locations.” The users at the bank would include Marketing Personnel, Dealers and Risk Managers.

About Pyxis Systems
Pyxis Systems is a solutions provider for Derivatives Risk Management and provides related consulting/ IT Services to banks / FIs & Corporate. Pyxis was started in November 2004 by two IIM Ahmedabad alumni, Mr. Nandlal Bhatkar an ex- international derivative structurer and conusltant & Mr. Sunil Nikhar (IT entrepreneur). Pyxis is the only company in SE Asia to offer end to end solutions in derivatives space and the only one in the world (in this domain) with a
state of the art technology centre based out of India.

About UTI Bank
UTI Bank was the first of the new private banks to have begun operations in 1994, after the Government of India allowed new private banks to be established. The Bank was promoted jointly by the Administrator of the specified undertaking of the Unit Trust of India (UTI - I), Life Insurance Corporation of India (LIC) and General Insurance Corporation Ltd. and its associates viz. National Insurance Company Ltd. The Bank's Registered Office is at Ahmedabad and its Central Office is located at Mumbai. Presently the Bank has a very wide network of more than 450 branch offices and Extension Counters. The Bank has a network of over 2000 ATMs providing 24hrs a day banking convenience to its customers. This is one of the largest ATM networks in the country. The Bank has strengths in both retail and corporate banking and is committed to adopting the best industry practices internationally in order to achieve excellence.

For further information kindly contact:

Naini Roy Choudhury – 98199 00135/22871361
Adfactors PR
naini.roychoudhury@adfactorspr.com

Rinki Saha – 98201 35827
Adfactors PR
rinki.saha@adfactorspr.com

Abhishek Rohatgi – 98811 23123
Pyxis Systems Pvt. Ltd.
abhishek.r@pyxis-it.com

 

December 2006, The Economic Times

MUMBAI: Knowledge process outsourcing is not only about high-end processing, legal work and healthcare outsourcing. It is a knowledge-rich industry and most players have carved out their niches in this multi-billion dollar industry.

Sunil Nikhar, an IIT-B and IIM-A graduate, like several other IITians looked West for opportunities, at first. He started a company called Ascent in New York and ran it successfully for nine years before selling it in 2003. Somewhere in Singapore another IIM-A graduate Nandlal Bhatkar was working with American Express before returning to India.

Entrepreneurial instinct got the two classmates together to start a KPO in the derivatives segment, Pyxis Systems in December, 2004 — perhaps the only Indian KPO in the derivative segment till date.

To start the new venture all they had was skills. Sunil Nikhar, founder and president, Pyxis recalls, “When we started we couldn’t recruit the right kind of people as there weren’t many people who could understand derivatives. Funding was also a problem.”

Both Nikhar and Bhatkar pooled in $0.5 million to get the company going but in the first year, there were problems regarding training and retaining people.

“In the first year, we used to report to employees rather than the other way around,” says Nikhar. Bhatkar who is known in the stock market circles for his good training skills, took up the task for grooming new recruits.

The company is still walking a tightrope and is expected to break-even in the first quarter of 2007. Recently, Pyxis got $1million angel investment funding. “This money will help us reach a certain level and break-even,” adds Nikhar.
The Pune-based company has developed Riskompass, a product which helps risk managers determine the price, analyse and manage risks in derivatives. “Managers can also analyse risk at different points of time with the help of the product,” says Nikhar. The product enables banks and financial institutions keep tabs on the market and generate reports related to derivatives.

Riskompass, which is targeted at large banks, financial institutions and hedge funds, costs around $0.5million, while similar products by international players such as French company Murex and US-based Sunguard costs anywhere between $1 million and $2 million.

To tap smaller organisations, Pyxis is going to launch a mini version of Riskompass in January which will be available on subscription basis.

Currently, Pyxis has only one client — UTI Bank, but by March, 2007, they expect to have three clients. The company has 60 employees and is considering raising the headcount to 100 by next year.

 

September 2006, The Economic Times

MUMBAI: UTI Bank has selected RisKompass, a software solution for financial derivatives risk management, developed by Pyxis System.

An agreement has been signed between UTI Bank and Pyxis Systems, said a release issued by UTI Bank and Pyxis Systems here on Thursday.

"We selected RiskKompass due to the user friendliness offered by the system. The software also offers good portfolio management features and pricing capabilities required to meet the increasingly complex requirement of customer business," said R V S Sridhar, Vice President-Treasury, UTI Bank.

RisKompass is a state-of-the-art software system for derivatives valuation and risk management, which enables clients to manage derivative trades in a more controlled manner from the front to the back office.

Speaking on the tie up, Pyxis System founder Nandlal Bhatkar said that for the first time a comprehensive derivatives risk management solution was being provided by a local vendor.

 

June 2006, Business Standard

Sticking to its USP of providing software as a service, Pyxis Systems, a Pune-based startup providing end-to-end services in derivatives risk management space is confident of striking it big in the banking, financial services and insurance vertical (BFSI).

Speaking to Business Standard after the company won its first client, a private sector bank, for its newly developed product Riskompass, Pyxis' CEO, Nandlal Bhatkar, said

"The derivatives market is a $5 billion market globally, growing at 22 per cent per year, of which 40-45 per cent is in the US, 30-35 per cent is in Europe and the rest in Asia which is galloping ahead to grow."

Pointing out that less than 5 per cent of the BFSI vertical have a derivatives system, the reason for which, Bhatkar said, is the "unsatisfactory service provided by MNCs and the high cost associated with these systems. A typical deal size for such systems is $1-2 million".

Helping organizations set up, integrate and run the derivatives systems, the company eventually plans to even provide business process outsourcing and knowledge process outsourcing services around the derivatives domain.

Sunil Nikhar, founder and president, Pyxis, said, "We will grow from a 45 people team to 125 people in the next 6-9 months. We will have 5-6 clients in the coming year for our product and within three years we will be a $18-20 million company

On the cards is also setting up offices in the US and UK for which they are in talks with venture capitalists for getting the first round of funding

"We are expecting to get a funding of $1-2 million soon for supporting our expansion plans to the US and UK," said Bhatkar.

Bhatkar, a domain expert, runs a leading derivatives consulting firm Origin Risk Management whose clients include American Express Bank, Reliance Infocomm, State Bank of India, and several others.

Nikhar, a technology expert, who having worked with corporations like IBM Corporation, Matsushita, Sony Corporation, Transamerica and others had setup his own company Ascent Computing Group that got acquired by China dotcom in 2003.

 

June 2006

Mr. Sunil Nikhar, President & Mr. Nandlal Bhatkar, CEO, Pyxis Systems

Pyxis Systems is an Integrated Solutions provider for Derivatives Risk Management and provides consulting/ IT Services to banks / FIs & Corporate . It is the first Indian company in the derivatives market space, which is principally occupied by foreign multinationals. The company operates three lines of businesses viz. Software Products for Financial Derivatives Industry, Consulting and IT Services in Financial Derivatives Space and BPO (Business / Knowledge Process Outsourcing) for mid and back office operations for Bank / FIs, Hedge Funds and corporates dealing in derivatives. Pyxis has recently completed the development of a state-of-the-art software system called ‘RisKompass’ for derivatives deal capture/valuation and risk management. Pyxis says it enjoys a 40% cost advantage with a development centre in India combined with highly experienced and capable consultants.

Mr. Sunil Nikhar, President, Pyxis Systems, brings in rich and diverse sets of skills from the derivatives and information technology domain. Prior to his current position, he was CEO of Ascent Computing Group, Inc USA. Ascent was acquired by Chinadotcom in 2003. Sunil has worked with several reputed companies such as IBM Corporation, Matsushita, Sony Corporation, TransAmerica, Glaxo Pharmaceuticals etc. in various technology and management roles. Sunil holds a B.Tech and M.Tech in Computer Science and Engineering from the Indian Institute of Technology (IIT), Mumbai, India. Sunil also has an MBA (PGDM) from the IIM, Ahmedabad.

Mr. Nandlal Bhatkar, CEO, Pyxis Systems, has been successfully running Origin Risk Management (www.origin-rm.com), a leading derivatives consulting firm, since October 2001. Origin is a leader in providing training, front office pricing tools and consulting for the finance sector. A few of Origin's clients include American Express Bank, Reliance Infocomm, State Bank of India , and several other leading banks. Nandlal headed a structured derivatives team for American Express Bank in Singapore , where he oversaw the Bank's operations in the Asia Pacific region from 1996-2000. Nandlal holds a Bachelor of Chemical Engineering from University of Mumbai and also has an MBA (PGDM) from IIM, Ahmedabad.

Replying to Anil Mascarenhas of India Infoline, the promoters of Pyxis Systems say the costs related to technology and professionals in the field of derivatives have continued to escalate.

Walk us through the changes we have witnessed in recent years in the risk management segment. Globally, what kind of growth are we witnessing?
Ever since the inception of over-the-counter derivative markets, we have witnessed a steady upward trend in the volume and complexity of the derivatives instruments. However, their demand for flexibility with ever increasing complexity and expansion of asset classes on which derivatives contract are based, pose a serious challenge to the technologies currently used to track them.

The phenomenal growth of the derivatives market has attracted major financial players to this field. The last decade has witnessed major innovations and developments in the structuring and engineering of financial derivatives products that the financial institutions sell to their clients.

However, the costs related to technology and professionals in the field of derivatives have continued to escalate, making it imperative for enterprises to reduce their operating costs from the front to back office.

How has the trend been in India as far as derivatives is concerned?
Derivative products made a debut in the Indian market during 1998 and overall progress of derivatives market in India has indeed been impressive.

The Indian equity derivatives market has registered an "explosive growth" and is expected to continue its dream run in the years to come with the various pieces that are crucial for the market's growth slowly falling in place.

Over the counter derivatives market in Interest Rate and Foreign Exchange has also witnessed impressive growth with RBI allowing the local banks to run books in Indian Rupee Interest Rate and FX derivatives. The complexity of market continues to increase as clients have become savvier, demanding more fine tuned solution to meet their risk management objectives, rather than using the vanilla products.

Besides Rupee derivatives offered by the local players, RBI has also allowed the client to use more exotic products like barrier options. These products are offered by the local bank on back-to-back basis, wherein they buy similar product from market maker from the offshore markets.

The complexity of derivatives market has increased, but the growth in deployment of risk management systems required to manage such complex business has not grown at the same pace. The reason being, very high cost of such system and absence of any local player who could offer the solution, which could compete with product offered by the international vendors.

What is your current turnover and profit? You spoke about a $18-20mn turnover. By when do you hope to achieve the same? What are the factors which will drive your growth?
Since it’s a new company we did not have any revenue so far. In the fiscal year 2006-2007, we plan to close 4 to 5 clients which will bring us close to $2.2mn. We plan to achieve a revenue base of $18-20mn in the next three years.

The business lines will expand into Productized services, ASP based offerings and KPO for mid-office and back-office for derivatives related activities to the global market players including Hedge Funds.

We feel the KPO will drive the revenue faster in the coming years

Tell us more about your KPO services? How many clients do you have here?
KPO division of Pyxis provides support for handling mid-office and back-office processes. Today, Pyxis has a trained pool of talented professionals with an expert knowledge of derivatives. The training division provides constant training to the staff to keep them up to date with the knowledge and also train professionals for undertaking specific tasks related to mid and back office.

Using the KPO services, both financial institutions and corporate can achieve significant cost savings through reduction in high cost manpower requirement and on the time spent on such activities.

Your present manpower strength. Any plans to ramp up. By how much and where?
Pyxis was started in November 2004 and has a team of 45 professionals currently in Pune. The team will be expanded to 120 professionals by March 2007 with sales offices in US and Europe.

Derivatives have turned to be more risky on account of high speculation. Your views on how effective it has been in risk management?
Derivatives allow the end user to unpackage risk in any financial instrument and allows the management of each of the risks individually. Thus it provides great flexibility in managing risk. It is due to derivatives that today a bank lending money say in HongKong can securitise it and using derivatives convert it into say USD short term instrument and sell to investors in the US. Derivatives has converted rigid financial instrument into "Lego" blocks kind of structure, allowing one to change certain aspects of the instruments, without having to change the actual underlying instrument.

However, the same instrument can be used for trading. The risk associated with derivatives is that the user may not know how the changes in various market parameters (like yield curve, Fx rates, Volatilities etc) impacts the value of these instruments. This is a very critical risk and risk management software are built to address this issue.

When do you see more Indians being active in the derivatives market space?
Derivatives on equity markets have been around for a few years. However, we believe that the smaller operators in the market are not very derivatives savvy ( you can see options being used for taking directional views). This is primarily due to the knowledge gap. Only if operators get more serious about the training needs, they are likely to operate within the current framework.

However, the larger institutions have realized this and have been imparting training to their staff. This is the reason why the OTC market, where corporates and banks are the key players, is lot more mature and advanced than the exchange traded market (especially when it comes to small and medium size operators).

What is the revenue break up between Software, Consulting and BPO. Going ahead how would the break up be in terms of percentage?
We envisage the revenue split from software, consulting and BPO in the ratio of 30:30:40 in the long run.

You’ve recently developed RisKompass. Does it integrate seamlessly with third party derivatives back-office etc?
RisKopmass is created with the knowledge that it will be getting integrated with various third party derivatives back offices. RisKompass uses XML and FpML to achieve this task.

You speak of a 40% cost advantage. How do you mange the same?
The cost advantage on the product side is mainly due to our lower operating cost vis-à-vis our competition. Pyxis also invests heavily in training its employees.

You have an analytics library. Is it only for internal use?
The analytics library gives us a competitive edge over others, it helps us providing and customizing solutions as we want, however we want it…. In summation we and our client can decide the model and its flavor of implementation rather than some readymade model that we have to work around

Who are the promoters? What is the shareholding pattern?
Pyxis was founded in November 2004 by two IIM Ahmedabad alumni and technocrats, Nandlal Bhatkar (ex- international derivative structurer / trader / consultant) & Sunil Nikhar (IT entrepreneur and founder of Ascent Computing Group, New York which was acquired by chinadotcom in 2003).

You are speaking with venture capital funds. How much do you plan to raise? What would the funds be utilized for?
We are planning to raise $2mn through VCs or Angels. The money will be used for expansion of team and expanding marketing efforts in US and Europe

Any plans to tap the capital markets? When?
Right now we plan to grow with the help of VCs and Angel investors. In another 3 -4 years we may look at tapping the capital market.

 

June 2006, The Economic Times

Who says India Product companies can’t battle it outr with the SAP’s Oracle and IBM of the world? Ask Tally which has dare to challenge the dominance of SAP and Oracle in the ERP Space. Or even Pyxis Systems which has launched a product that competes with Sungard and Reuters or Newgen Software and is successfully winning market shares from American measures such as EMC, NCR and Unisys. Up against the brand power and pedigree of the North American and European software majors, India Minnows are using the India advantage to offer “Value for Money” and a better understanding if the local condition.

“With our entire product development based in India, we are 30%- 40% cheaper than that of our competitors. That’s a big competitive advantage against our competitors, whose major operations are based in high cost centers in Europe and North America”, Says Pyxis System’s Founder and President Mr. Sunil Nikhar. The company has developed “Riskompass”, a product for derivatives deal valuation and Risk Management. It has already bagged 2 clients. Pyxis Competes with similar products from companies such as Sungard and Reuters.

Other Indian Companies are banking on scale provided by the large Indian Market to take on MNCs, whose focus has mostly been large Indian Companies. “MNCs follow the Gartner definition which classifies its small and medium business (SMB’s) as those with the minimum turnover of Rs (150-200) crores. That’s not our focus, we want our ERP package to be used even by a Rs. 10 crore company”, says Tally Vise President, Head South Africa Sales Mr. Subhas Arora. “While SAP targets 100 customers a year in India, we have already signed 750 in the last 3 months”, he added.

To garner numbers, the company is targeting industrial clusters across the country. For instance, its representative contacted around 10000 industrial units in Faridabad to understand their IT needs. It plans to repeat the same in Chennai. It’s the same with Newgen Software which makes work flow and document management software maker

Newgen Software. The company differentiates itself from the foreign competitors such as IBM and EMC on the basis of lower life cycle cost and faster implementation.

 

June 2006, The Economic Times

The much touted outsourcing and off shoring of high end software on which critical applications of Global financial entities run is beginning to happen. This is a niche segment, different from the Software services on which India has built her reputation as a software power house.

Pyxis Systems Pvt. Ltd., a start up company developing solutions for derivatives, trade and risk management, is targeting the $4.8 billion global market for Risk Management Products and services. This is a market dominated by a world’s big consultant who can command hourly rates of $180-200 for consultants with domain expertise in the derivative and Risk Management System. Off shored to India, the rates can come down to $40-50 an hour. “This is a segment which requires Domain expertise, with a very high level of Mathematical skills of the PhD level of pure, not applied Math”, said Mr. Nandlal Bhatkar, Founder and CEO, Pyxis Systems. The company provides customized solutions in derivatives and Risk Management, for which it has developed its own analytics library. It uses Software as a platform to deliver solutions to the different asset classes.

In the International Markets, the leading providers of products in this segment do not customize. Hence, Banks are forced to buy products, not solutions. Pyxis on the other hand offers the service to its products, customizing the package into a solution. “We are positioned to offer a productized service or solution, to the Bank or Financial Institutions”, said Mr. Sunil Nikhar, Founder and President, Pyxis Systems.

“The India market, which we are targeting first, had daily transactions worth Rs. 40,000/- crores in derivatives”. Explaining how a derivative works, Mr. Sunil Nikhar citied the example of an Airline which might want to undertake long term contracts for aviation fuel. It has to work in the Risk of the International Price of Crude, Currency, Fluctuations, etc. Banks and Financial Institutions as intermidiaries, sell components of this deal, to mitigate the risk.

“In India, this trading instrument began in 1999-2000. In the West, it is a well established practice and there are derivatives for weather, etc. and the combinations vary. Credit derivatives which are very big in the US and European markets, shThe much touted outsourcing and off shoring of high end software on which critical applications of Global financial entities run is beginning to happen. This is a niche segment, different from the Software services on which India has built her reputation as a software power house.

Pyxis Systems Pvt. Ltd., a start up company developing solutions for derivatives, trade and risk management, is targeting the $4.8 billion global market for Risk Management Products and services. This is a market dominated by a world’s big consultant who can command hourly rates of $180-200 for consultants with domain expertise in the derivative and Risk Management System. Off shored to India, the rates can come down to $40-50 an hour. “This is a segment which requires Domain expertise, with a very high level of Mathematical skills of the PhD level of pure, not applied Math”, said Mr. Nandlal Bhatkar, Founder and CEO, Pyxis Systems. The company provides customized solutions in derivatives and Risk Management, for which it has developed its own analytics library. It uses Software as a platform to deliver solutions to the different asset classes.

In the International Markets, the leading providers of products in this segment do not customize. Hence, Banks are forced to buy products, not solutions. Pyxis on the other hand offers the service to its products, customizing the package into a solution. “We are positioned to offer a productized service or solution, to the Bank or Financial Institutions”, said Mr. Sunil Nikhar, Founder and President, Pyxis Systems.

“The India market, which we are targeting first, had daily transactions worth Rs. 40,000/- crores in derivatives”. Explaining how a derivative works, Mr. Sunil Nikhar citied the example of an Airline which might want to undertake long term contracts for aviation fuel. It has to work in the Risk of the International Price of Crude, Currency, Fluctuations, etc. Banks and Financial Institutions as intermidiaries, sell components of this deal, to mitigate the risk.

“In India, this trading instrument began in 1999-2000. In the West, it is a well established practice and there are derivatives for weather, etc. and the combinations vary. Credit derivatives which are very big in the US and European markets, should come to India in the next few years. This refer to instruments used by Banks which have taken loans fron the international market and need to swap credit, says, against the oil rate. Here the pricing of the instruments is critical since there is huge combination varity possible”, Mr. Sunil Nikhar, said.

While entry into the Global Market could be through the simplest route, handling the back office, the aim is to move higher up. This involves handling the front and middle office business. Every trader has a trade limit, and needs verification from a Risk Manager if he is exceeding his limit. However, the Risk manager needs to calculate the risk, which could be offshore. This is where Pyxis is positioning itself.

Admitting that getting domain experts is difficult anywhere, witness the high rate a consultant can command in New York, Mr. Sunil Nikhar, said they have chosen to recruit fresh IIT Mathematics oriented talent. The company will set up its knowledge processing Office (KPO) operations soon. Its solution as an ASP (application service provider) will roll out by mid 07 and it is in the process of setting up offices in the US and UK.

The 45 people company, which is looking at an Angel investment of $1.5 million by end of this month, is also ramping up. It expects to have 100 people by the end of this fiscal. Mr. Nikhar said the Angel Funding, from Bankers from India, Singapore and Honkong, would last them for about 18 months, at which time they would look at venture capital finance.
ould come to India in the next few years. This refer to instruments used by Banks which have taken loans fron the international market and need to swap credit, says, against the oil rate. Here the pricing of the instruments is critical since there is huge combination varity possible”, Mr. Sunil Nikhar, said.

While entry into the Global Market could be through the simplest route, handling the back office, the aim is to move higher up. This involves handling the front and middle office business. Every trader has a trade limit, and needs verification from a Risk Manager if he is exceeding his limit. However, the Risk manager needs to calculate the risk, which could be offshore. This is where Pyxis is positioning itself.

Admitting that getting domain experts is difficult anywhere, witness the high rate a consultant can command in New York, Mr. Sunil Nikhar, said they have chosen to recruit fresh IIT Mathematics oriented talent. The company will set up its knowledge processing Office (KPO) operations soon. Its solution as an ASP (application service provider) will roll out by mid 07 and it is in the process of setting up offices in the US and UK.

The 45 people company, which is looking at an Angel investment of $1.5 million by end of this month, is also ramping up. It expects to have 100 people by the end of this fiscal. Mr. Nikhar said the Angel Funding, from Bankers from India, Singapore and Honkong, would last them for about 18 months, at which time they would look at venture capital finance.

 

May 2006, The Economic Times

NEW DELHI: Risk management solutions provider for derivative market, Pyxis Systems, is targeting a turnover of $18-20 million in the next three years.

The target set by Pyxis is on the back of growth in derivative markets across the world.

"Currently we have two orders, one from an Indian private sector bank and the other from the US. We expect this to double by the end of this year," Pyxis Systems Founder and CEO Nandlal Bhatkar told media.

We would also increase our headcount to 120 from the existing 45 by December 2006 and expect to reach topline to $18-20 million in the next three years with 80 per cent of our revenues coming from global clients, he said.

The Pune-based company, incorporated in 2004, is expecting investment to the tune of $2 million from Indian venture capital soon.

"We are talking to a few venture capitalists to raise $2 million for our expansion and product development," he said.

The company deals in the derivative market space by providing risk management solutions and integrated services for trading with flexibility. It also deals with consultancy and IT services for the market.

"Pyxis has recently developed its product "RisKompass" for derivatives deal valuation and risk management and is in the process of developing its own analytical library," he said.

The product is priced at $500,000, he said.

 

September 2006, HR Speak Column | Smart Techie

Sunil Nikhar
Founder/Head HR, Pyxis Systems
Headcount: 55

I look out for two traits in candidates while recruiting. One, whether they can take risks and another, if they are ambitious. These are pre-requisites for working in any organization and that alone can push a person up the career ladder.

A scientifically proven study developed in Arizona has stated that the first child in the family is intellectual and the second is believed to be creative and inventive and best suited in the IT industry. I have followed this method and have found out for myself that this theory works!

Experience matters, but while recruiting a fresher, you can’t just close your eyes to him because of his inexperience. No CEO is born in a day.

Once I confronted a similar situation when we met a soccer-fan in a candidate. We asked him to do a presentation on soccer and he took that opportunity and in front of 50 others, made a presentation on soccer, relating it to his job profile. He demonstrated strategies used in the game and co-related the field with IT companies. This impressed me and we immediately hired him.

Analytical skills prove the real worth of candidates. To a question like “What’s the approximate number of vehicles in X city”, the candidate can roughly estimate it by finding out the degree of population in that city and calculate accordingly.

What is essential is to think of possible solutions rather than give a hurried “I don’t know”, for an answer. Similarly, I have an aversion to candidates who quit jobs on the pretext of money. In the long run money really doesn’t give job satisfaction. Money should not be the key driver; it has to be career progression. We once had a candidate who had quit his earlier job on the look out for more money. Needless to say we did not hire him.