Essel Group Floats Net-Based Exchange Intrex

Subhash Chandra's Essel group has floated a new company Intrex India which will be a trade exchange on the Internet. The new company will create a convergence of the market place, a trade exchange and a bank.

Ashok Goel, managing director, Intrex India, said: "This is not a dotcom venture or an IT company, but is associated with the Internet as that would be the main technology. It is a traditional business on a new platform."

"Every organised business in India needs to increase capacity, utilisation, control inventory better and promote more efficient cash flows. This is the core demand that Intrex India is designed to meet," he said.

Intrex India will be owned by the Goel family with the entire investment of around Rs 60 crore coming from within the family. As regards the investment into the company, Goel said, "The entire project has been divided into three phases. In the first phase, the promoters have invested Rs 15.77 crore and in second we are investing Rs 17.65 crore."

The Intrex trade exchange model is a click-and-mortar model combined with Internet and an extensive network of channel partners who will extend their assistance and fulfillment through traditional channels.

As regards the market for such an exchange, Goel said, "We have identified 407 industries within six categories namely manufacturing, services, utility, entertainment, agriculture and others. To begin with the company will cover only 50 industries."

As per Intrex's survey, there are 1,34,556 registered manufacturing units in the country, of which there are 1,22,722 private units and the rest are government units. There are 5,01,261 registered companies and there are 5,10,821 non-government companies.

The company expects the moneyless trade exchange industry size in India to be as big as Rs 23,850 crore. Against this backdrop, Intrex India is expecting to earn gross revenue of Rs 4.75 crore in the first year and by the tenth year expect revenues to grow over Rs 550 crore.

The company has a technical tie-up with ICICI Infotech, which has designed and implemented the exchange and Ernst & Young has been roped in for validating the business plan and systems application.