A Reuters compilation of those wanting to tap overseas markets in fiscal year 2000/01 (April-March) showed 25 firms aiming to raise at least US $ 4 billion. This compares with net foreign institutional investor inflows of around US $ 11 billion into the Indian stock markets since 1993. "The hunger for being seen as global players and enjoying high valuations is driving Indian companies to list abroad," said Shanthi Ekambaram, executive director, Kotak Mahindra Capital Company.

Besides fetching a higher price on the technology-laden Nasdaq, which has vaulted nearly 94 per cent over the last 12 months, the firms also gain from a related surge in their local share prices. India's first company to list in the United States, Infosys Technologies, offered its American Depositary Receipts (ADRs), each representing half a local share, at US $ 34 in March 1999. Adjusting for a stock split, the ADR has since risen about 15 times to close at US $ 250 on Wednesday. On the Indian bourses, Infosys has risen six times to Rs 10,343 in the same period. ICICI Bank made a debut on the New York Stock Exchange on March 28 at a 27 per cent premium to its offer price of US $ 11 each. Based on Wednesday's (March 30) closing price, the premium is 36.36 per cent. There are four Indian firms now listed on the US markets.

US Listings to boost M&As
India's knowledge-based companies in software, media, pharmaceuticals and telecommunications have in the past year become aggressive on growth and many consider acquiring firms in developed markets the fastest way to achieve their goal. Analysts said the overseas listings provided these companies with the money and global presence needed for such a task.

"They are going to raise capital, get themselves a currency and thirdly a global footprint because the kind of profile and currency they can get by an international acquisition clearly will fit into their strategy of becoming global conglomerates," Kotak's Ekambaram said. Firms like Infosys and Wipro, which on Tuesday announced plans to raise up to US $ 500 million abroad, have been demanding more freedom to buy overseas firms. Last week, the government obliged with a series of measures. According to these norms, knowledge firms can buy companies abroad through ADR/GDR stock swaps up to 10 times the value of export earnings of the previous year.

3-yr profit norms a dampner
Some Internet firms like Rediff want to directly make an overseas offering without an Indian listing because local bourses insist on a three-year profit record unless a bank or FI is willing to take a stake in the company. There have not been any overseas acquisitions by Indian companies listed abroad, though some smaller locally-listed software firms have struck deals with global companies.

Surge in amounts raised
The estimated US $ 4 billion that Indian firms plan to raise in the year from April, compared with US $ 1 billion in 1999-2000, will make them Asia's biggest issuers of ADRs. "Last year, we listed 20 Asian companies. This year, because we expect more from India, I would put that figure up to about 25," Patrick Sutch, Nasdaq's director for Asia Pacific said. Globally, firms raisd about US $ 21 billion in 1999 through ADR offerings - more than double the US $ 10 billion raised in 1998, JP Morgan said. More than 43 per cent were from telecommunications, media and technology. Investors have been flocking to Indian issues because of the enormous growth potential offered by Indian knowledge-based and manpower related companies. Indian software companies' cutting edge technology and e-commerce drive help them score over other companies, analysts said. Lower manpower cost and high talent also make Indian firms attractive.

Major offerings
The big Indian offerings on the ADR market in the next few months are expected to be a US $ 1.5 billion issue from Zee Telefilms, a US $ 500 million issue from Wipro and a US $ 200 million offering from Dr Reddy's Laboratories.

In the pipeline
Rediff Communications: The portal is expected to list its ADR issue on the Nasdaq exchange in early April. The government has approved the company's proposal to raise US $ 74 million through ADRs.
Indiainfo.com: Considering an issue on the US. Nasdaq or Indian markets. Size estimated between US $ 50 million-US $ 100 million. Timing uncertain.
Indiatimes.com: Owned by the Times group, the company expects to list in India or on Nasdaq. Timing uncertain.
Satyam Computer: The firm plans to list its ADRs in the fiscal year.
Silverline Technologies: Expects to begin ADR offering process before April. Plans to raise US $ 125 million by way of ADRs.
Aptech: The firm plans to raise up to US $ 125 million through an ADR/GDR issue. It will seek shareholders approval at its annual meeting in April. Timing uncertain.
Kaashyap Radiant: A joint venture between the Kaashyap group and the New Jersey-based Radiant Systems Inc., the firm is exploring the possibility of making an ADR issue in 2001.
Rolta India: The firm plans to issue up to 5 million shares by way of ADR/GDR or as a preferential allotment to foreign institutional investors. Timing uncertain.
Polaris Software: The software services firm plans to make an offering of ADRs by September 2001.
Pentasoft Technologies: In January, the company said it had deferred a decision to hike the size of a proposed issue of equity shares/ADRs/GDRs for now after the government liberalised ADR/GDR issue procedures.
Videsh Sanchar Nigam: It plans to convert its existing GDRs into ADRs within the next few months.
Mahanagar Telephone Nigam: The company is expected to file documents with the US Securities Exchange Commission by mid-April for an end-April or early May listing on the New York Stock Exchange. The firm is converting some of its GDRs into ADRs.
Bharti group: India's largest private telecommunications service provider plans to list on the Nasdaq market. Timing uncertain.