Optical networking vendor Tejas Networks India Ltd. has plans to further expand its operations outside India and into Southeast Asia.
The Bangalore-based company is said to be raising $20m from India-focused hedge fund Sandstone Capital, followed by a private equity fund buying out existing investors like IL&FS, which holds around 15% stake in the company. Sandstone Capital is one of many investment funds that have sprung up to back Indian startups.
Sandstone Capital is one of the largest India-dedicated investment funds, based in Boston, Massachusetts the company manages capital for U.S. and European universities, foundations and families. Sandstone invests in public and private Indian companies with strong growth prospects.
Tejas Networks was started in 1998 by Guru Raj Deshpande, the founders are Sanjay Nayak, Kumar N Shivrajan, and Arnob Roy. The company has raised funding from investors like Intel Capital, Battery Ventures, ASG Omni, Sycamore Networks, IL&FS and Gabriel Venture Partners.
CEO Sanjay Nayak says the company has won small OEM deals in other emerging markets such as Indonesia and Vietnam, which it will use as a starting point to expand its sales in the region. Tejas is “shipping in the thousands” to OEMs, he says, which include as yet unidentified partners in the U.S. The company has been profitable for the past three quarters and expects to reach $50 million in revenues for the financial year ending in March.
“We believe that the time is ripe for Indian product companies. Tejas has performed very well not only to gain significant market share in the fast-growing but highly competitive Indian telecom market, but has also reached international customers through strong global partnerships”, said Paresh Patel, Managing Director of Sandstone Capital in a statement.
International sales account for around 25% to 30% of the company’s revenues, but “the objective next year is to have an equal split between India and international sales,” Nayak says.
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