Mumbai-based WNS (Holdings) Limited (NYSE:WNS), which was started as the in-house unit of British Airways Plc, U.K.’s largest international airline in 1996 for captive business process outsourcing (BPO) services, has become the second largest third party BPO company of India. Today WNS has a market value of more than a billion dollar after the recent listing of its ADSs (each ADS representing one common stock) in New York Stock Exchange (NYSE).

WNS, (formerly known as Speedwing World Network Services) raised $224 million through its initial public offering (IPO) of 11.2 million ADS representing about 28% stake at the price of $20 per ADS. The final IPO price was actually on the higher side of the estimated price range of $18-$20. On the listing on July 26, the stock price of WNS rose as high as $25 before closing at $24.50, giving 22.5% return on day one. With this price movement, WNS became a company of billion dollar market value on the debut day at NYSE.

At the current market price of $25.80 per share, WNS has a market capitalisation of $1.03 billion, compared to its valuation of slightly more than $60 million in May 2002, when private equity investor Warburg Pincus bought 64.7% stake in the company from British Airways Plc for $40 million. The strong performance of the WNS IPO came at a time, which was described by stock analysts as a difficult period for IPOs. British Airways sold its remaining 14.6% stake in the company in July 2006 and would report about £48 million ($88 million) gain in its books on account of this sale.

During the one-month period from the listing, WNS has moved in the range of $20.79 (July 26, the date of listing) to $28.60 (August 22). The high of $28.60 reflects a rise of 43% compared to the issue price of $20.

WNS has become the second most valuable Indian investment for Warburg after the largest Indian GSM mobile phone operator Bharti Airtel Limited, where it made more than five times its money in October 2005 on an investment of $300 million. In terms of percentage gain, however, Warburg has received higher returns than its investment in Bharti. Based on the current market capitalisation of more than $1 billion, Warburg’s stake is valued at about 16 times of its initial investment of $40 million. Warburg has indicated that it has no intentions to dilute its stake in WNS, as it expects that WNS will continue growing at a high pace.

The company has posted revenue of $53 million for the first quarter (Q1) ended June 2006, up 3.6% compared to $51.2 million in the first quarter of financial year (FY) 2005-06. The revenue less repair payments, however, grew by 37.1% to $45.5 million in Q1 of FY06-07 from $33.2 million in Q1 of FY05-06. The sequential growth in the revenue less repair payments compared to the Q4 of FY05-06 ending March 2006 was at 9.8%.

WNS believes that revenue less repair payments reflects more accurately the value addition of the business process services that it directly provides to its clients. The presentation of this non-GAAP information shouldn’t be considered in isolation or as a substitute for the financial results of the company prepared in accordance with U.S. GAAP (Generally Accepted Accounting Principles), the standard framework of guidelines for financial accounting. WNS revenue less repair payments may not be comparable to similarly titled measures reported by other companies due to potential differences in the method of calculation.

Net income for the quarter ended June 30, 2006, was $4.6 million, up 5.0% from $4.4 million in the quarter ended June 30, 2005. Net income for the quarter grew sequentially by 24.6% from $3.7 million in the previous quarter.

WNS claims to have industry specialisation in Travel, Insurance, Financial Services, Healthcare, Professional Services, Manufacturing/Retail and Logistics. The company has divided its operations in two segments—WNS Global BPO and WNS Auto Claims BPO. While the WNS Auto Claims BPO handles company’s automobile claims management services called WNS Assistance, all the remaining activities come under WNS Global BPO.

When Warburg acquired WNS In May 2002, it had the employee-base of about 1500, which has now grown to more than 10,400.