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Strategies & Market Trends : India Coffee House

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To: Mohan Marette who wrote (8740)	10/21/1999 8:45:00 PM
From: Mohan Marette	Read Replies (2) of 12475

HINDALCO eyes New York (NYSE) adityabirla.com Hindalco sets its sights on NYSE Mollica Senapati (FE) MUMBAI 21 OCTOBER Hindalco is the latest Indian company eyeing the American stock markets. The Aditya Vikram Birla group company is exploring the possibility of a listing on the New York Stock Exchange (NYSE). According to investment banking sources, Hindalco is seeking an NYSE listing to either convert its existing global depository receipts (GDRs) into American Depository Receipts (ADRs) or issue fresh ADRs in the US markets. Hindalco has $172m in GDRs outstanding in the European markets. These have been issued in two tranches of $72m in July '93 and $100m in July '94. The GDRs are quoting at $24.38 each or Rs 1,058. This works out to a premium of 24 per cent over the local price of Rs 850 per share. Hindalco's interest follows closely on the heels of ICICI, which has already listed its $315-m ADR on the NYSE and the plans of Reliance Industries and Reliance Petroleum to convert their GDRs into ADRs. The NYSE provides for greater liquidity as retail US investors are not allowed to invest in non-American markets. While company officials could not be contacted, sources at a financial institution confirmed the move and said that the company was carrying on the formalities towards a NYSE listing soon. This means that the company will be aligning its accounts to the US generally-accepted accounting principles (GAAP) soon. However, investment bankers are not yet clear as to whether Hindalco's existing GDRs would be converted into ADRs or whether the company will go for a fresh issue of ADRs. Global aluminium prices are now on the upswing and the timing of Hindalco?s US foray could be just right. Already, Infosys and Satyam Infoway have experienced immense success on the Nasdaq, while the ICICI ADR is quoting at a 20 per cent premium to the domestic price.

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