The Telegraph
Since 1st March, 1999
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TCS maiden issue next year

New Delhi, Dec. 4 (PTI): Information technology major Tata Consultancy Services plans to come out with an initial public offer by next year in India and possibly on the overseas stock markets as well, while aiming at a 30-35 per cent growth in business.

“Whether TCS will be first listed on the domestic market or on the overseas bourses—are being deliberated with merchant bankers,” company sources said here today.

Along with domestic issues, TCS is likely to list either on the US markets (NYSE or Nasdaq) or London Stock Exchange or on both markets, sources said. The double or triple listing is in view of the huge market capitalisation the company expects to bag. Analysts, comparing TCS with Infosys and Wipro, put this figure at over Rs 14,000 crore.

Listing in India alone may not fetch the company the best value for its shares as the market may not be able to absorb the IPO at a high premium.

The jewel in the crown of Tata group would come with a “mega” issue probably by next year, considering the market situation and the best value it can fetch, sources said. According to Sebi norms, technology companies can offload a 10 per cent stake to the public as against 25 per cent for companies in other sectors.

Company sources declined to give details of whether the 10 per cent would include ADRs/GDRs or just equity to the Indian public. Chances are high that a chunk of the IPO would be set aside for employees as well, they said.

Before it goes public, TCS intends to jack up its profits further and targets a 30-35 per cent in revenues now at over $ 1 billion. The IT major, with a toehold in over 50 countries, is looking ahead to sourcing software programmers from Philippines and Vietnam, apart from tapping the Indian market for skilled manpower.

“In terms of cost, quality and scalability, India is still the best country to tap IT professionals,” the official said. The company is also open to active co-operation with financial entities including banks and insurance companies, for bringing in full integration of the markets.

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