ANALYSIS-India Infosys set for historic US listing
Tuesday March 9, 7:48 am Eastern Time
By Y.P. Rajesh
BANGALORE, India, March 9 (Reuters) - Infosys
Technologies Ltd will blaze a trail for other Indian firms to
follow when it lists on the U.S. Nasdaq exchange later this
week, technology industry experts said on Tuesday.
But analysts said Infosys' new status, when it becomes the first Indian firm to debut on the
technology-rich exchange on Thursday, will also place a heavy responsibility on the software and
services firm.
Girish Paranjpe, vice-president for finance at diversified computer and software group Wipro
Ltd , described Infosys' listing as historic.
''This will create the pathway and encourage several other companies, especially infotech and
pharmaceutical companies, to work towards listing on major international bourses,'' he said.
Infosys is considered a leading share on India's stock exchanges and its strong performance has
played a major role in a rally that followed the February 27 announcement of the country's
budget for the fiscal year to March 2000.
Infosys listed in June 1993, with shares issued at a nominal value of 10 rupees, but opened
trading at around 158 rupees each.
Infosys' strong results and positive industry sentiment sparked a rally in the stock weeks before
the budget.
Between December 31, 1998 and February 26 (the day before the budget), Infosys rose 83
percent to 2,708 rupees. By contrast, over the same period, the Bombay 30-share index rose
six percent.
Infosys has kept pace with the post-budget boom as well.
Infosys rose nearly 19 percent in the period from February 26 onward to hit a day's high of
3,222 on Tuesday, against the 30-share Bombay index's corresponding rise of 17 percent.
Infosys went on a roadshow in the United States last month to sell 1.8 million American
Depositary Receipts (ADRs) with each ADR representing half a share of common stock.
''It (the ADR) is a highly significant milestone for the country,'' said Pradeep Kar, chairman of
Microland Ltd, a leading Indian infotech company.
''The listing will help Infosys grow globally as it will be able to acquire companies abroad,'' he
said. ''Globally, acquisitions are done through stock swaps and the listing will allow Infosys to
do that.''
M. Chandrashekaran, corporate adviser at Silicon Automation Systems, a design software
maker, said Infosys had led the way in establishing new standards of corporate governance and
transparency in the Indian software industry.
Infosys would be keenly watched by aspirants seeking to emulate its performance, he said.
''Infosys will carry a great burden of expectations riding on them,'' he said. ''Companies listed
on exchanges like the Nasdaq are under a magnifying glass all the time and more so if it is the
first from a country,'' Chandrashekaran said.
''The issue is therefore not just of listing but that of post-listing performance. In that sense it is an
enormously courageous step by Infosys,'' he said.
B.V. Naidu, director of the Bangalore unit of Software Technology Parks of India (STPI), said
Infosys' listing would boost global investor confidence in Indian companies.
($1 equals 42.5 rupees)
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