Infosys Q3 Income Surges To Rs 73.36 Crore

Software major Infosys Technologies yesterday repo-rted a total income of Rs 73.36 crore in the three months ending December 31, 1997 against the year-ago figure of Rs 38.09 crore.

The firm said that income from overseas software development was Rs 71.05 crore compared with Rs 34.14 crore last year.

Income from domestic operations totalled Rs 1.98 crore in the third quarter of 1997-98 against Rs 2.43 crore in the year-ago period. Other income was Rs 33 lakh compared with Rs 1.52 crore last year. The EGM convened by the company at Bangalore yesterday, passed a special resolution for raising $75 million by way of ADRs to finance expansion activities. It also approved the company's proposal to increase authorised share capital from Rs 20 crore to Rs 30 crore.

 

At the EGM, Infosys clarified that its plans for converting the holding of FIIs/NRIs/OBCs in Infosys up to $100 million will not make any impact on the company's equity.

The EGM passed a proposal to create a ESOP kitty of $50 million for employees as its 'next phase' of ADR issue. The shareholders also approved the move to issue up to $30 million by stock-swap for purposes of acquisition of new companies in the US.

Interestingly, Infosys' promoter directors have excluded themselves from the ESOP scheme. The company's proposal to pay half per cent of its net profits among its directors, which was passed at the EGM, has also excluded the managing director and the executive directors.

The special resolutions passed at the EGM gave permission to the company to issue and allot shares to foreign investors who may not be existing shareholders.

Infosys' chairman and managing director Narayana Murthy denied reports that any valuation has been done in the US for its shares.

The company said the ADR issue will be used towards expansion and establishing of new software facilities, besides acquiring software companies in the US in future.

The EGM further authorised the company to offer equity shares up to $50 million to foreign investors through issue of various kinds of securities, etc.

According to Infosys, the company is still awaiting the Centre's approval for the proposed issue. It said it planned to get registered either on the New York Stock Exchange or Nasdaq National Market.

On the exact amount to be raised within the ceiling of $75 million, Infosys had clarified that it would be decided in consultation with its lead managers. The company has named San Francisco-based NationsBanc Montgomery Securities Inc, to handle its ADR issue.

Terming the ADR issue as 'going into next orbit,' Murthy said the it would help the company to compete in US market along with other branded services companies.

Following its plans to go in for an ADR, Infosys Technologies has unveiled an 'action plan' to give the company an equal footing with US software companies, both in marketing and brand equity.