MUMBAI, Dec 2: Infosys Technologies Ltd (ITL) on Tuesday announced that it plans to issue American Depository Receipts (ADRs) upto US $ 75 million and subsequently seek listing on a US stock exchange. The proposals were formally discussed at the company's board meeting held in Mumbai today.

``Infosys is putting its strategy in place for going to the next orbit. This will require that Infosys compete in the premier market space of branded service companies. We will have to compete on value-based pricing.

This means that Infosys will have to invest both in front-end capabilities in Western markets as well as in high quality infrastructure in the development centres,'' said N R Narayana Murthy, chairman and managing director, ITL. No Indian company has listed its shares on a US bourse so far.

Infosys Technologies plans to tap the markets in Europe and Japan after the US, Murthy said. ``We are starting with the US as it commands 55 per cent of the world information technology market and is perhaps the most dynamic. The next destination would be Europe followed by Japan.

We are also open to, if the need arises, setting up a base in China which we see as a major infotech market in the next five years,'' Murthy told analysts, shortly after the Infosys board cleared a four-pronged strategy for the company to storm the US software market.

Murthy said that Infosys had already benchmarked itself against some US software firms listed on Nasdaq and found that it had the highest operating margins, profit before tax and profit after tax among them. He further added that the ADR issue and subsequent listing in the US will also create the global currency to give stock options to employees so that the company can attract and retain the best and brightest from all over the world.

The ADR proposal is to raise US $ 75 million and also for creating an Employee Stock Option Plan (ESOP) pool of up to US $ 50 million. The proposal also includes an enabling provision to issue up to US $ 50 million by stock swap for the purpose of acquisition.

ITL will also seek the necessary approvals from the Union government for the ADR issue, said a company official. ITL has also convened an extra-ordinary general meeting of its shareholders on January 6, 1998 for the purpose. ITL has also launched BankAway, the remote banking super platform enabling customers faster, better and easier access to their bank, through the delivery channel of their choice.

It integrates existing and emerging channels like Internet, screen phones, WebTV etc, to provide a unified view of their financial information with complete customer orientation.

He added that in the light of the growing competition in the infotech industry, the ideal model to be adopted would be that of ``Indian costs and US prices''. However, this was easier said than done. On the one hand, Indian costs were rising with salaries going up 25-30 per cent every year.

On the other hand, garnering a share of the US market would involve creating brand equity in that market and providing a local interface to service customers better.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.