WMI, Dishnet, Shrishti and KMR Online are among the companies which currently offer Internet services regionally, though it is not known if Satyam is targetting any of these companies.

Satyam will be utilising a part of the $ 75 million ADR proceeds for acquisitions. ``If appropriate opportunities can be developed, we believe that our growth could be accelerated by selective investments or acquisitions in India, particularly in Internet service providers that have developed local or regional points of presence in markets where we have not yet established a presence,'' the company has said.

Besides, Satyam Infoway is also considering opportunities to acquire sources of content for its Internet portal.

``We expect that once we have the net proceeds provided by this (ADR) offering available to us, we will become more aggressive in our efforts to identify one or more investment or acquisition opportunities,'' says the company.

While utilising a substantial part of the ADR proceeds to build up infrastructure, the company believes in taking the acquisition route to growth. The company expects ``a significant number of new competitors to enter India's Internet service provider market in the near future.'' As of June 30, 1999, a total of 129 companies had obtained Internet service provider licenses in India, including 22 companies which have obtained licenses to offer ISP services throughout India.

However, the main competition for Satyam Infoway would come from the goverment-controlled VSNL, which also has the monopoly over all the international telecommunications traffic from and to India. As of June 30, 1999, compared to Satyam's 80,000 subscriber, VSNL had around 300,000 subscriber. VSNL's other competitive advantages include lower rates, longer service history, graeter financila resources and easy access to network infrastructure controlled by the government.

The other origins of competition, as recognised by the company, are from the well-established Indian content providers, including IndiaWorld and RediffontheNet. And Satyam's corporate and technology services business faces significant competition from well-established companies, including Global E-Commerce Limited, Sprint-RPG Limited and WIPRO-CSD.

INSIGHT:

Satyam Infoway trades at $41 on Nasdaq

Satyam Infoway resumed its trading on the Nasdaq with a surge of over $ 5 on the second day. A day after its mega success ADR float, the Satyam Infoway ADR was trading at $ 41.125 during the opening session. Against its previous close of $ 35.5, the stock was up $5.625 with 8.68 lakh ADRs already traded during the first half-an-hour of Nasdaq's Wednesady trade. During the day, Sify had touched a high of $ 42.625.

At this level, the Satyam Infoway ADR is quoted at a premium of 127 per cent to the offer price of $ 18. The ADR float received bids worth $ 2 billion which helped the company hike the offer price by about 30 per cent from the earlier band.