The equity offerings continue to be few; even these are courtesy the euphoria around the software sector as well as the statutory RBI norm requiring banks to go public. According to Prime, in the six month period, only 14 equity issues have hit the market raising a meagre Rs 592 crore.

Although this compares favourably with Rs 332 crore raised in the corresponding period last year, the total amount is still small to indicate a revival.

Significantly, of the Rs 592 crore, the banking sector through three issues has mobilised Rs 344 crore (58 per cent of the total equity raising). The softwaresector with nine issues has collected Rs 170 crore. The rest is accounted for by one PSU offer of Rs 75 crore and one NBFC offer of Rs 2 crore. Most disturbing, according to Haldea, is the languishing equity mobilisation by the manufacturing sector, which has now reached a zero level in the six-month period. This represents a major fall successively over the last four years, from a high of Rs 11,005 crore in 1994-95.

The immediate future is also likely to witness a domination of the software and banking sector. Public issues in the near future from the software sector are expected from HCL Technologies (Rs 600 crore), Hughes Software (Rs 300 crore), Geometric (Rs 25 crore), SRA Systems (Rs 25 crore), Computech (Rs 25 crore), Wintech Computers (Rs 20 crore), S Kumar's Microsystems (Rs 15 crore), Helios and Matheson (Rs 11 crore), VMC Software (Rs 10 crore), Akshay Software (Rs 8 crore), Kushal (Rs 6 crore), Logix (Rs 3 crore), Sankhya Infotech (Rs 2 crore) and S Kumar's Com (Rs 1 crore).

Banks likeSyndicate Bank, Oriental Bank of Commerce, Punjab National Bank, Union Bank of India, Indian Overseas Bank, Andhra Bank, Vijaya Bank, Canara Bank and Nedungadi Bank are gearing up to tap the market. It is interesting to note that of the 22 public issue offer documents filed with Sebi since May 1, as many as 16 are from the software sector. Of the balance, three are from the banking sector, one from a PSU, one from a broking firm and one from a greeting cards company. The disturbing trend of a flooding of software IPOs needs to be urgently corrected, according to Haldea.

Significantly, while in 1997-98, there was not even a single issue from the software sector, four software firms which entered the market in 1998-99 provided the green signal.

All these four issues Sonata Software (Rs 23 crore), KPIT Systems (Rs 12 crore), Cybermate Infotek (Rs 2 crore) and Shri M M Softek (Rs 2 crore) evoked overwhelming response from the investors. Similar has been the success story of the seven software issues of thecurrent fiscal: SQL Star (Rs 14 crore), Compudyne Winfosys (Rs 1 crore), Subex System (Rs 6 crore), Amex (Rs 7 crore), Polaris (Rs 92 crore), Fortune Infomatics (Rs 2 crore) and Kaashyap Radiant (Rs 3 crore). Two IPOs from Kale Consultants (Rs 35 crore) and Compucom (Rs 11 crore) are opening in the later this month.

Haldea stated that as witnessed in the past, a sectoral frenzy is initially led by strong companies. What then follows is a deluge of operators. To take advantage of the euphoric conditions where issues are getting oversubscribed by 20 to 40 times, several unscrupulous promoters are already at work. Many of them may also take unfair advantage of Sebi's recent relaxation allowing IT companies to offer only 10 per cent of their capital to the public.