JUNE 15-30, 2001: Lackluster Days Continue...

After weeks of speculation about the sale of Groupe

Bull’s majority stake in PSI Data Systems, all questions have been

finally answered. Indian Rayon, the AV Birla Group flagship company has

proposed to pick up the 50.35% stake in PSI from its French parent in all

cash deal worth Rs 71 crore. The price of each share is pegged at Rs

186.60 per share. Indian Rayon is also expected to make an offer for an

additional 20% at the same price at a later date. Since the announcement

of the deal, the counter has been moving southward. The PSI share closed

as the top loser of the fortnight, down 27% over its previous close at Rs

130.

Mascon Global announced a joint venture with credit

card major Master Card in which it will own 51% equity stake. The venture

named Mascon-MasterCard Global Technology Services will develop and

maintain proprietary software for MasterCard’s core processing functions

of authorization, clearing and settlement. The stock closed at Rs 61.95,

down 10.35% over its previous close. Mascon is also gearing up to come out

with an ADR issue. Analysts are, however, expecting a firm trend in the

counter whenever sentiments on software counters improve.

The company has entered in a strategic alliance with

US-based Epicentric Inc., a leading provider of next generation portal

solutions. Satyam will be responsible for providing end-to-end consulting

and integration services for Epicentric Foundation Server. The details are

not yet available. Satyam is one of the stocks on which Options shall be

introduced from July 2, 2001. The stock closed at Rs 170, losing 14% over

its previous close. The stock is expected to see buying interest in the

coming days.

The Mumbai-based software company is all set to acquire

US-based CTC Corp in an all stock deal. CTC is an IT solutions provider

offering services in the areas of technical resourcing, offsite and

offshore software development, e-business solutions and training.

Silverline shall issue 4.5 million ADRs to the US company. On the NYSE,

the company’s ADR was priced at $3.50 when the deal was announced

translating into an acquisition price of $15.75 million.

The Bangalore-based IT major has announced a strategic

relationship with US-based Burlington Northern Santa Fe (BNSF) which

operates the second largest rail network in Northern America. Infosys will

provide software integration services to BSNF and it plans to employ over

125 people during the next 18 months for the project. Towards the end of

the fortnight, the Jardine Fleming and DSP Merrill were reported to be

major buyers on the counter, citing a positive outlook for the company.

This is one of the stocks which has been on the receiving

end quite regularly in recent times, even on those occasions when most

other IT stocks have witnessed a firm trend. The fortnight ended saw the

stock as one of the major losers. Rumors were rife that the company’s

managing director DVS Raju is not keeping good health, which saw massive

selling on the counter. Although the company termed the rumors as

baseless, the stock remained under selling pressure through most of the

fortnight.