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March 13, 1999


Bigger morale does as good as money in Infosys ranks

Email this story to a friend. M D Riti in Bangalore

A decade and a half ago, most of them were working for American firms. Today, Infosys Technologies Limited has become the first Indian company to be actually listed on NASDAQ.

"As of now, we have no concrete plans to acquire any American companies," says Nandan Nilekani, MD, one of the founders of the firm that is now widely acknowledged as one of the premier infotech companies in the country.

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"But we wanted to create currency to enable us to acquire companies abroad. However, this was not our sole objective. Basically, we also chose to list ourselves to raise money," he explains.

They certainly seem well on the way to achieving their objective of doing this. Infosys shares were listed at $34, opened at $37, rose to $50 and dropped to $46 by the end of the day.

Nilekani says that the trading volume was also high. "We already have international clients and investors," Nilekani told Rediff in Bangalore.

"This is our next step towards going global. We now need to hire employees worldwide, and would like to offer them also the kind of stock options that we offer our Indian employees."

Infosys was one of the first Indian companies to offer stock options to its employees. Many other Indian infotech firms now do, particularly the MNCs, but most prefer to keep this employee perquisite a closely guarded secret.

"We cannot offer our overseas employees rupee stock options," says Nilekani. "Having a NASDAQ listing will enable us to offer dollar based stock options now."

Does Infosys plan to recruit staff in the US or in other countries like China, where highly skilled personnel may be available at low salaries, as in India? The company is not really telling just yet.

"It is too premature to predict exactly what will be our next plans," says Nilekani. "However, another major objective of this ADR is to build Infosys equity globally, and make our customers comfortable with the knowledge that we have a genuinely international identity."

Getting Infosys listed on NASDAQ was a long process.

The firm first announced their intention of getting the listing in December 1997. It took them 15 months to achieve their goal.

"We had to have our balance sheets recast, and follow the US GAAP accounting system, which is among the most stringent in the world," says Nilekani. "But the effort was worth it."

Their choice of the US to get listed was, of course, because it is what Nilekani describes as "the market headquarters of the world". He explains that "Even German companies like SAP, who were listed in Germany, have now come on to NASDAQ. The US is, of course, the largest and deepest market, and the home of some of the world's best hi-tech companies."

Now, NASDAQ hopes other Indian companies will follow suit and get listed too.

Meanwhile, its celebration time at Infosys headquarters in Bangalore. Champagne flowed on its basketball courts and fireworks lit up the skies when the company announced the listing.

Huge video screens displayed the landmark happening millions of miles away in New York, where Company Chairman N R Narayana Murthy had gone to witness the event.

"I can only echo our chairman's statement, when he said: This is a small step for NASDAQ but a giant leap for Infosys and the Indian software industry," says Nilekani.

Evincing his own pleasure at having Infosys on board, NASDAQ Stock Exchange President Al Berkley pointed out that Infosys fits in very well with the kind of growth and job creation capabilities that they themselves encourage.

For the Bangalore based company that began 17 years ago with a starting capital of about $250, it is indeed a great happening.

Infosys is now believed to command a market value of over $2 billion.

If the broad grins on the faces of their numerous engineers, clad appropriately for the announcement in white T-shirts bearing the names of Infosys and NASDAQ, is anything to go by, the listing has certainly been a great morale booster for its employees.

"Now we hope to attract the best talent worldwide," said Murthy expansively.

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