Investors get clear picture of goings-on

Domestic firms are increasingly using audio- and video-conferencing solutions for investor relations calls.

With increasing pressure from regulators to reach out to all investors, analysts and institutional buyers "" both in India and abroad""domestic firms are now increasingly using integrated audio- and video-conferencing solutions for their investor relations (IR) calls.

Video-conferencing technology helps people located in multiple places to see and listen to each other simultaneously via two-way video- and audio-transmission. Based on interactive telecommunication technology, it can also be used to share documents and whiteboards.

The most important element in audio- and video-conferencing is that the entire proceeding is moderated, with absolutely no interruption during the meeting and presentation. This gives every participant a chance to ask questions and the benefit of that reply goes to everybody.

A company can get the natural transcript of the proceedings, which reduces the chances of their presentations or quotes being misrepresented.

Besides, most of the listed companies announce their results in a span of 15-20 days, which makes it difficult for the stakeholders, institutional buyers, analysts and funding agencies to attend the meetings physically.

Diptarup Chakraborthy, Principal Analyst, Gartner India, says: "Investor relation calls create more opportunities to meet companies more often. It helps us in closely monitoring the companies and also in reviewing their performance on a regular basis. As an analyst, IR calls help me in giving more authentic and genuine information to the market."

While exact figures are hard to come by, industry observers say every year they have been noticing at least a 20 per cent increase in the use of audio and web platforms for IR calls.

"The quality of investors has seen a major change "" from a standalone brokers' market to a more institutional-based one which is dominated by mutual funds, venture capital funds and pension funds that feel comfortable in serious business discussions via audio- and video-conferencing," says Kiran Datar, MD of WebEx Communications India.

Infosys Technologies was the first customer of WebEx in India for IR calls in 2000, after the company introduced its communication software in the Indian market. The last two years, however, have seen many old-world companies too starting to use the collaborative communication software for corporate governance.

WebEx sources say they have seen at least an 80 per cent increase in many of these old-world companies using technology for IR calls. It handles at least 150 IR calls every quarter now.

Some old-economy companies include Cairn Energy, DRL, Ashok Leyland, Apollo Tyres, ACC, Sterlite Industries, Patel Engineering, Ballarpur Industries, Dabur India, ABG Shipyard, Kohinoor Foods and Sri Renuka Sugar.

"It's absolutely a way to go forward. Instead of conventional methods of gathering analysts at one place, it allow the global audience to participate in the proceedings," says Swaminathan Krishnan, senior VP (Marketing), Sasken Communication Technologies.

Yugal Sharma, country manager, India & SAARC, Polycom, says: "In India, a number of organisations across the telecom & IT sectors are large users of conferencing. We see large deployment of voice and, more importantly, video solutions in industries like manufacturing and steel."

Meanwhile, most of the telecom services operators in India including Tata Indicom, Reliance and Airtel have started focusing on providing conferencing solutions. Airtel recently introduced video-conferencing solutions for its enterprise customers.

"These days, there is a lot of demand for audio-video conferencing for investor calls and meetings. In fact, it is slowly occupying the top slot in our service. It constitutes the bulk of the scheduled meetings," claims Prakash Bajpai, CEO of Reliance Communications.

With inputs from Aravind Gowda