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Strategies & Market Trends : Asia Forum
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To: Mohan Marette who wrote (1662)1/28/1998 11:04:00 AM
From: LKO  Read Replies (1) of 9980
 
Infosys Technologies. News about ADR
(don't recall who asked about ADRs of Indian companies).
expressindia.com

Strange content though....some excerpts
----
MUMBAI, Jan 27: Infosys Technologies will not be
targeting conventional investors in Indian equity
when it launches its $75-million American Depository
Receipts (ADR) issue. Instead, the company has
decided to market the issue to selective
technology-specific funds which would prefer to hold
on to the scrip rather than arbitrage with the
underlying share in the domestic market.
...

"The aim of the company is to be seen as a US
company with a manufacturing base in India. For this
reason it does not want its shares to be sold to the
conventional investors in Indian equity and instead
target investors who want to invest in technology
stocks," said an investment banking source
....
When contacted, company sources confirmed that the
company would not be targeting the conventional
buyers."The idea is to broadbase our investor
profile.
----

Sounds like they are looking for a premium and are afraid of
arbitrage. Or really want to be listed on a US exchange without
meeting all the requirements.

Just like vultures providing a valuable service in
disposing dead animal bodies :-), I believe arbitrage has a good
role in the markets of creating a level playing field.
I am not a financial expert, but I do think listing all the SEC
and market regulations are also there for a good reasons.

All this posturing and frequent blame on "foreign" arbitrage
and currency traders that sometimes emanates from Asia does
seem like excuses for not facing up to the fundamental
underlying more local problems and issues.
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