Ameer Khatri Atul Randev Himanshu Jain Prashant Kumar

HEC RAPTORS
 ABOUT THE COMPANY

Integrated IT solution development & implementation for

banking industry

Specialty: Risk Management, Lending and Credit Scoring

Present across diverse geographies- 60 countries and 25

Clients

Employee centric focus on Performance based appraisal

& employee engagement

Flat organizational structure

5 offices presently

Source Loxon website

Background Analysis Objective Strategy Financials Implementation

 KEY STATISTICS
Approx. Revenue in million HUF

No. of No. of Revenue/Cus Revenue/Em

Year/Region HU CEE CIS MEA APAC Total
Customers employees tomer ployee
2010 620 290 200 20 1130 27.00 83.00 41.85 13.61
2011 600 390 210 120 1320 28.00 108.00 47.14 12.22
2012 520 600 240 230 150 1740 33.00 126.00 52.73 13.81
2013 480 420 390 230 170 1690 37.00 134.00 45.68 12.61
2014 520 680 520 350 190 2260 39.00 136.00 57.95 16.62
2015 480 550 320 570 370 2290 45.00 145.00 50.89 15.79
projected 2016 456 625 352 1114 500 2637 49.84 162.12 52.92 16.27
Growth rate 2010-2015 -4.99% 13.66% 9.86% 95.42% 35.11% 15.17% 10.76% 11.80% 3.99% 3.01%

Background Analysis Objective Strategy Financials Implementation

 KEY INDUSTRY ISSUES- SWOT ANALYSIS
STRENGTH WEAKNESS

Balanced Portfolio of technology Small Revenue difficult to qualify for bids in emerging
Experience of working in the core banking industry countries
Good experience of credit scoring technology Legacy systems in banks- difficult to integrate new
Worked across 25 different regulatory and business products
environments Low experience in Fintech and merchant transaction
High quality employees services

OPPORTUNITY THREAT

Cloud computing market improving technology Mobile Banking

Peer to peer banking/lending market Bitcoins
Crowd sourcing Payment Wallets
E-commerce payments and business analytics tools Services like Ubank
Business opportunities in APAC and MEA countries Other competitors such as: TCS/Infosys/Nucleus/FICO
Personalized financial analysis space

Background Analysis Objective Strategy Financials Implementation

KEY OBJECTIVES

High 1 Customer
employee
retention & Experience
development

Bank
Maintain 2
High High &
Product focus
to enter new
Business
Operational
stable technology
Efficiency
domain
growth rates

3
Market
expansion to
opportune
geographies

Loxon to improve customer experience for Banks

Background Objective Strategy Financials Implementation

OFFER CURRENT PRODUCTS IN NEW GEOGRAPHIES

Key Observations:
Growth rate in MEA post-recession (2010-2016): 95.42 %

Uncertainty in
Need for
Money
Uncertainty in Oil software that
movement-
prices- Majorly helps manage
currently more
Price decrement liquidity as well
with consumer
in recent past as risk
and less with
management
corporates

Background Objective Strategy Financials Implementation

OFFER CURRENT PRODUCTS IN NEW GEOGRAPHIES

Key Observations:
Growth rate in APAC post-recession (2010-2016): 35.11 %

Need for
Higher default risk Requirement of
software that
Poor credit rating customer loan
helps in credit
High Non- management &
scoring & loan
performing assets monitoring
management
with Banks

Background Objective Strategy Financials Implementation

OPPORTUNITIES FOR CREDIT SCORE TECHNOLOGY

Good opportunity in
APAC region and few
MEA countries

World Bank Financial

Stability Report data

Background Objective Strategy Financials Implementation

IMPROVING CUSTOMER EXPERIENCE-NEW PRODUCTS

1. E-Commerce
2. Mobile Wallet
3. Personalized Financial Analysis
4. Bitcoin/P2P segment/ Crowd funding

Background Objective Strategy Financials Implementation

E-COMMERCE
Support banks by developing merchandise transaction application.
Take advantage of huge data in E-commerce to improve credit scoring.

Developing credit
scoring technology
and offering to
banks

Background Objective Strategy Financials Implementation

MOBILE WALLET
Telecommunication, Technology and Non-banking giants offering tokenization
Mobile-Wallets usage increasing at a high pace due to simplicity and faster process

Background Objective Strategy Financials Implementation

PERSONALIZED FINANCIAL ANALYSIS
Integrate scheduled payments and quick shopping transaction in customer mobile banking app
Provide customers with insight into their trends, limits and risks.
Use the customer trends to provide customized offers, loyalty points and loan ratings.

Background Objective Strategy Financials Implementation

BITCOINS/P2P LENDING/CROWD FUNDING

Explore potentials in Bitcoins as many VC firms are funding startups in virtual currency space.

Acquisition to be cheaper as demand is still on the rise.

These segments are being regulated at a faster pace

Use Experience to provide technology with:

1. High Security
2. Fraud monitoring
3.Agile
4. Adaptability to regulations.

Background Objective Strategy Financials Implementation

BITCOINS/P2P LENDING/CROWD FUNDING

Background Objective Strategy Financials Implementation

ORGANIZATIONAL STRUCTURE

4 Layer Recommended structure:

L1 Senior Management (CEO, Program Directors)

L2 Managers
L3 Project Leaders
L4 Staff

Background Objective Strategy Financials Implementation

ADVANTAGES OF A FLAT ORGANIZATIONAL STRUCTURE

Promotes employee involvement through a decentralized decision

making process.
Elevates the level of responsibility of baseline employees.
Eliminates layers of middle management.
Comments and feedback reach all personnel involved in decisions
quickly.
Expected response to customer feedback becomes more rapid.

Background Objective Strategy Financials Implementation

EMPLOYEE RETENTION POLICIES

Incentive based appraisal system directly linked to Loxons growth.

Incentives in the form of Employee Stock Ownership Program (ESOP).
Implementation of employee rotation schemes, especially for fresh
hires and managers, offering them opportunities to work in global
locations.
Maintaining healthy work culture, allowing 30% office spaces for
relaxation.
Employees to be engaged in trainings with a career development
program.

Background Objective Strategy Financials Implementation

 EXPECTED IMPROVEMENTS

Become banking IT Solution giant

LOXON vs Competitor (FICO) Revenue**

Revenue*: 2290 M HUF 218642 M HUF

Employee*: 145 2646
Presence*: 25 Countries 90+ Countries
Economies of Scale: 15.7 82.6
(Revenue/Employee)
Surpass FICO numbers in next 5 years
High ROE of 23% in origination & sales
High transaction volume of $15.9B as per Statista
*Figures used for FY 2015-16
** Data taken from FICO website

Background Objective Strategy Financials Implementation

HOW TO IMPLEMENT

1. Enter MEA and APAC offering current products.

2. Grow regional customer and projects to qualify for government tenders.
3. Simultaneously, recruit from fintech/virtual currency industry.
4. Develop smart and high security products for growing segments.
5. Develop technology to capture date from different segments.
6. Offer applications to improve customer experience using business
analytics.

Background Objective Strategy Financials Implementation