Through its maiden public offering, the company is offering 12,90,000 equity shares and depending upon the issue price the aggregate offering is pegged between Rs 9.68 crore and Rs 11.61 crore. Underwriting arrangements for the issue are yet to be finalised by the company.

Enthused by the boom in the secondary market for IT scrips, a number of software companies are expected to hit the market with public issues. The Sonata Software issue, which was priced at Rs 90 a share, closed last week attracting an oversubscription of over three times.

At an estimated cost of Rs 15.40 crore, the Pune-based KPIT Systems is establishing a software development facility at Pune Infotech Park and is also setting up subsidiaries in the US and in Dubai. According to the draft prospectusfiled with the Securities and Exchange Board of India, of the total cost, Rs 11.61 crore is to be financed through the present issue. The balance Rs 3.79 crore will come through internal accruals.

KPIT Systems has already spent Rs 58 lakh on the project which is scheduled to be completed by July 2000. Post-issue, in case the premium is fixed at the higher end, the company also proposes pre-payment of some of its long-term borrowings.

KPIT Systems offers a wide range of software related services to its clients in the UK, the US and the middle east. Its services include project implementations in the field of Euro, re-engineering, enterprise resource planning (ERP), data warehousing, e-commerce and other internet related services. IBM/Y2K related services had contributed around 25 per cent to the company's total revenue in fiscal 1998. The company also has a partnership with Oracle of US.

More than 90 per cent of the companyÕs total revenue during fiscal 1998 came from its overseas operations. While theUK subsidiary has contributed 57 per cent of the total revenue, its domestic operations contributed only 7 per cent. To meet the growing needs of its overseas operations, the company has already set up a wholly-owned subsidiary in the UK and is mulling similar facilities in the US and the middle east.

Post-issue, the promoters' contribution will be pegged at 50.63 per cent, down from its current level of 67.5 per cent, and the public holding will be 25 per cent. The employees, through their welfare fund, will hold 3.5 per cent equity.

While the application money is Rs 25, the balance would have to paid on allotment. The KPIT Systems' shares are proposed to be listed at the Pune, Hyderabad and Ahmedabad stock exchanges.

Enam Financial Consultants are the lead managers to the offer. The company is yet to finalise the opening and the closing dates for the present issue.