• PAGE ONE
• INDEX
• HOME

Infy outdoes Infosys

K.S. Badri Narayanan

IN the days following the announcement of second-quarter results by Infosys, the top three Indian infotech ADRs listed in the US markets have streaked ahead of their domestic counterparts. Infosys, Wipro and Satyam Computers have all posted better return s in the US market compared to their domestic offerings.

Infosys posted a return of 42.64 per cent compared to 23.39 per cent posted by the Infosys stock at the BSE since October 10, the day the Infosys results were announced.

An analyst in Chennai said foreign investors have probably recognised the value of Infosys Technologies more than the Indian investors because the company is over-owned in the domestic markets. ``Buying through FIIs' channel is painful as foreign individ uals are not allowed to buy the stocks directly, which pushed them to buy ADRs,'' the analyst said.

However, the difference in performance between ADRs and the underlying shares in the case of other IT companies was not so significant. The Satyam Computers ADR posted a return of 23.39 per cent as against 19.85 per cent gained by the Satyam Computers st ock and Wipro ADR gained 22.08 per cent (21.19 per cent).

The US market no doubt has gained more during this period compared to the domestic stock market. However, the difference in performance was noticeable even after adjusting for the relative variation in market returns. Thus, while Nasdaq gained about 15.1 2 per cent, the Bombay Stock Exchange Sensex returned only 7.98 per cent (between October 9 and October 25).

The only exception of course is that of Silverline Technologies. The equity in the domestic market had gained more than its ADR. While the stock surged 56.19 per cent at the BSE, its ADR gained 51.91 per cent.