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Strategies & Market Trends : India Coffee House -- Ignore unavailable to you. Want to Upgrade?

To: Mohan Marette who wrote (5263)	7/25/1999 11:37:00 AM
From: Mohan Marette	Read Replies (1) \| Respond to of 12475

Indian software companies eye U.S. IPOs (by Sanjit Singh, IDG News Service\New Delhi Bureau) July 23, 1999 NEW DELHI (07/23/99) - Time was when Indian software firms considered themselves made if they got orders from the U.S. Time was when Indian software firms were thrilled to supply cut-price programmers to U.S. firms. Time was. Indian software firms are now eyeing the U.S. for different reasons. Sure, it still remains their main market, but increasingly it's becoming the place to go public, and to buy companies. Flush with funds from fixing year 2000 problems all over the world, Indian software firms are lining up to offer shares on U.S. stock exchanges and to use the capital generated from this to buy stakes in U.S. software companies. The first signs of this became apparent four months ago, when Infosys Technologies Ltd., long a darling of Bombay Stock Exchange, became the first Indian company to offer shares on the Nasdaq stock exchange. Its shares traded at US$34 initially, but it has already seen its stock price touch $121. Now its looking for U.S. firms to acquire and is considering starting a U.S. software development center. A number of top Indian software companies are choosing this path for growth, and it's easy to see why. As revenue from year 2000 services slow down and the world moves toward e-commerce, India's software companies need to be close to the action. Another factor is that growth from leveraging India's cost advantage -- a programmer in India costs three to five times less than in the U.S. -- can take these companies only so far. "Large Indian software firms now have annual revenues of (US)$100 million to $200 million. To grow to $500 million and beyond, they need a U.S. presence and a global presence," said an IT analyst at a large Dutch bank, who asked not to be identified. Dewang Mehta, president of India's apex software industry organization, the National Association of Software and Service Companies (Nasscom), said things have come full circle. "First Indian firms would bring work home from the U.S. or send people there. Now, they feel the need to be in the U.S. to benefit from a rapidly changing environment," he said. Nasscom estimates that over the next 12 to 18 months, about 10 Indian software companies are expected to offer shares on the U.S. stock exchanges and then acquire companies in the U.S. Some of these companies have already gone public in India, while others are looking to launch an Initial Public Offering (IPO) in the U.S. The prime candidates to offer their stock in the U.S., according to industry analysts, are software makers HCL Technologies Ltd.(http://www.hclinfosystems.com/), Pentafour Software and Exports Ltd.(http://www.pentafour.com/), Silverline Industries silverline.com, Datamatics Ltd. datamatics.com, Tata Infotech Ltd. (http://www.tatainfotech.com/), Mastek Ltd. (http://www.mastek.com/homeapp2.htm) and units of Wipro Ltd. (http://www.wiprosystems.com/) and Tata Consultancy Services.(http://www.tcs.com/) These companies have generated revenue mainly from year 2000 work and maintenance of legacy systems, and now are moving into customizing application for large services firms and trying to develop their own products. Another leading software and services company, NIIT Ltd.(http://www.niit.com/), is reversing the cycle. The firm has arranged a $100 million line of credit and has shortlisted 20 companies from which to choose acquisition targets. Once it completes the acquisitions, it will probably offer shares in either itself or the acquired company in the U.S.

To: Mohan Marette who wrote (5263)	7/25/1999 12:00:00 PM
From: JPR	Read Replies (1) \| Respond to of 12475

Mohan: Here are the extracts from your ref. and links Albright and Singh expressed hope that bilateral relations would be far better than those in the last 50 years, when Washington traditionally backed its Cold War ally Pakistan, a senior U.S. official said. U.S. experts and officials have recently argued for more robust U.S. engagement in South Asia. India is especially attractive because of its enormous commercial potential and its potential to become a major power. The now-infamous tilt was kissed good bye and is replaced by Clinton's realignment because US national interest coincides and converges with India's. JPR