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

To: Mohan Marette who wrote (7271)	9/27/1999 7:56:00 PM
From: Mohan Marette	Read Replies (1) \| Respond to of 12475

IPO News: Hughes Software float price set at Rs 630 hssworld.com (Tuesday, September 28, 1999) Anjan Mitra in New Delhi-BS Hughes Software Systems (HSS) has fixed a price of Rs 630 per share for retail buyers after going through the book-building exercise. The bids for book-building have been accepted in a price band between Rs 430-Rs 630 per share. HSS is a subsidiary of Hughes Network Systems and a group company of the US-based conglomerate General Motors-Hughes Electronics is the first multinational which is going in for an IPO through the book building exercise in the country. The company, a leading supplier of communications software products and services internationally, is entering the capital market with as public offering of 0.43 crore equity shares and, of this, 0.39 crore shares has been made available under book building and 0.04 crore equity share (about 10 per cent) under fixed price like normal public issue. HSS will be offloading 26 per cent equity to the Indian public. The move and the price which the company has fixed for retail buyers (Rs 630/share) is obviously an attempt to cash in on the sentiment towards infotech stock in the Indian market. The move will push down the holding of the parent company from the current level of 76 per cent to less than 60 per cent, company sources said. Three of HSS' other shareholders, along with Hughes Electronics, will be diluting will accordingly dilute their stakes in the company. In HSS, while 76 per cent equity stake is held by Hughes Electronics, 24 per cent shareholding is with venture capital funds. The ISO 9001 company set up shop in India in 1992 at an investment of over $26 million. A senior executive of the company had told Business Standard sometime back that part of the money raised from the market will be used to fund acquisitions. HSS is looking at acquiring e-commerce companies which will have synergies with its activities. HSS has projected that its revenues by 2000 AD is expected to touch Rs 2000 million, up from slightly over Rs 500 million in 1998. The company also expects to corner 90 customers by 2000, up from 35-odd customers it had in 1998. HSS' turnover has grown at an average annual rate of over 70 per cent during its existence period in India and now is a company totally focussed solely on communications and electronic commerce software. HSS investments in India is a continuing process for which it needs additional funds too. Last year it set up a separate Internet development centre in Bangalore with an investment of about $2 million. The centre aims to maximise HSS' capabilities in developing products and solutions based on the Internet. The company also plans to launch a slew of cyber products that integrate network solutions with advanced web technologies for use by telecom operators, ISPs and telecom equipment suppliers.