Four Norwest-funded firms with India story to go public

BSE should market itself better to attract cross border firms for listing, says Pramod Haque

Promod Haque, the man with the Midas touch in incubating technology start-ups, has announced that Norwest Venture Partners (NWP), of which he is a partner, will actively look at investing in sectors like consumer internet, outsourced product development and software product firms.

Haque further added that nearly four out of the 18 firms, in which NWP invested and has significant presence in India through housing their engineering centres, are expected to go public during the current calendar year.

Speaking to the media in Bangalore on Monday, Haque said: "The internet space is maturing and becoming robust. Business models around this domain are becoming realistic and with broadband and wireless access scaling up rapidly, investing in these companies makes sense for us."

He added that other areas of focus would be outsourced product developed firms and software product firms themselves.

Commenting on when NWP portfolio companies with a presence in India might go public, he said: "Listing on Nasdaq or on the Bombay Stock Exchange is a debate which is going on at these firms. The Sarbanes-Oxley Act in the US has made it that much costlier for companies with $70-80 million turnover. The other logical choice for these firms, as they have a significant presence in India, is the BSE. However, BSE needs to market itself in a better way to attract these cross-border firms." He further added that London Stock Exchange is another option which is also being explored.

On the other sectors NWP is actively looking at, he said: "There are a lot of outsourced product developed firms based out of India who are working for companies like Cisco, Oracle and IBM and they offer a promising growth path. With the Indian market also emerging as a consumer of technology products, software product firms which capitalise on this opportunity are also a good bet."

He further noted that NWP, which is currently drawing down its $800 million fund, is also expected to raise a further $600 million during the second half of current year. NWP is examining to have a direct presence in India soon through its own office.

Speaking on one of NWP's recent investments in India, he said: "We have invested substantially in a travel service provider Yatra Online, which will be starting operations by June this year. In 2006, the Indian travel market is estimated to reach close to $40 billion, and plans to hit close to $500 billion by 2009. This company will address this market comprehensively by offering internet, wireless and call centre routes."

He added that although the travel market is flourishing, the needs of today's Indian travellers are still under-served due to the fact that the travel industry is extremely fragmented. It is very difficult for Indian travellers to find, compare and select the best flight and hotel packages and deals, and make reservations at the lowest cost and seek out the best service. Yatra Online will address all this.