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.
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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