The enterprise value of Satyam Infoway has increased more than 10 fold in the past 12 months since its principal promoter Satyam Computer Services first placed a substantial portion of equity with Commonwealth Development Corporation (CDC).
An analysis of Satyam Infoway's equity indicates that while 17 per cent of its equity was placed with CDC for $5 million in 1998, by October 1999, the company could command $86 million for a similar quantity (22 per cent) on the Nasdaq.
In the intermittent period between the two transactions, Satyam Infoway's enterprise value grew from approximately $30 million to around $390 million, even as it ended financial 1998-99 (first year of full operations) with a net loss of Rs 18.7 crore.
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The company admits that such growth may not have been possible without the Nasdaq listing. "The exchange is familiar to the business and the risks involved," said T R Santhanakrishnan, chief financial officer (CFO), Satyam Infoway.
There is a question mark on the appetite for Internet start-up stocks on Indian bourses as local laws require
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