An eye on Nasdaq 100 index, Infosys extends gain
Software bellwether Infosys edged higher for the second day in a row today after shareholders on Tuesday approved a sponsored ADR issue.
The scrip was up 1.5% to Rs 2,135 in early-afternoon trade. As many as 1.9 lakh shares changed hands in the counter on BSE.The stock rose for the second day in row following the shareholders’ nod for ADR issue. It had risen 1.5% on Tuesday to Rs 2,102.45.
The purpose to go in for another ADR issue is to increase float in the overseas market. With this issue, the overseas float of Infosys stock will increase 5%, pushing the total float to 19%, which is made up of 77.7 million shares. The increased float is expected to help Infosys to achieve its longstanding aim of getting into the famed Nasdaq 100 index, consisting of the 100 largest non-financial stocks listed on the Nasdaq.
The underwriters will decide the pricing of the offering after a roadshow.
The premium of the Infy ADR over its BSE share price has narrowed over the years. Each Infy ADR represents an underlying equity share. Based on Tuesday (7 November)’s closing prices on BSE and Nasdaq, the Infy ADR trades at about 11% premium to its price on BSE. In early April 2005, before Infosys’ last year’s sponsored ADR issue, the premium was as much as 45%.
Infosys’ sponsored ADR issue will be valued at more than $1.5 billion based on Infosys' $51.66 closing price on the wider Nasdaq market on Monday.
At the time of announcing Q2 September 2006 results, Infosys revised upwards its EPS and revenue growth guidance for FY 2007 (year ending 31 March 2007). The company has forecast revenue between Rs 13,853 crore and Rs 13,899 crore for FY 2007, transforming into projected year-on-year growth of 45.5 - 46%. EPS for FY 2007 is forecast at Rs 66, a projected year-on-year growth of 46.6%.
The current price of Rs 2135 discounts its projected FY 2007 EPS of Rs 66, by a PE multiple of 32.3.
The scrip was up 1.5% to Rs 2,135 in early-afternoon trade. As many as 1.9 lakh shares changed hands in the counter on BSE.The stock rose for the second day in row following the shareholders’ nod for ADR issue. It had risen 1.5% on Tuesday to Rs 2,102.45.
The purpose to go in for another ADR issue is to increase float in the overseas market. With this issue, the overseas float of Infosys stock will increase 5%, pushing the total float to 19%, which is made up of 77.7 million shares. The increased float is expected to help Infosys to achieve its longstanding aim of getting into the famed Nasdaq 100 index, consisting of the 100 largest non-financial stocks listed on the Nasdaq.
The underwriters will decide the pricing of the offering after a roadshow.
The premium of the Infy ADR over its BSE share price has narrowed over the years. Each Infy ADR represents an underlying equity share. Based on Tuesday (7 November)’s closing prices on BSE and Nasdaq, the Infy ADR trades at about 11% premium to its price on BSE. In early April 2005, before Infosys’ last year’s sponsored ADR issue, the premium was as much as 45%.
Infosys’ sponsored ADR issue will be valued at more than $1.5 billion based on Infosys' $51.66 closing price on the wider Nasdaq market on Monday.
At the time of announcing Q2 September 2006 results, Infosys revised upwards its EPS and revenue growth guidance for FY 2007 (year ending 31 March 2007). The company has forecast revenue between Rs 13,853 crore and Rs 13,899 crore for FY 2007, transforming into projected year-on-year growth of 45.5 - 46%. EPS for FY 2007 is forecast at Rs 66, a projected year-on-year growth of 46.6%.
The current price of Rs 2135 discounts its projected FY 2007 EPS of Rs 66, by a PE multiple of 32.3.
posted by SY at 4:10 PM
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