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July 21, 2000

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 Company  Lanco Global Systems
 Market Price  Not listed
 Lead manager  Lanco Group
 Listing At  Ahmedabad, Bombay, Hyderabad
 Opening/Closing  July 21/July 26
 Promoters Lanco Group
 Associate Co.  Lanco Construction, Lanco Industries, Lanco Kondapalli Power, Kalahasthi Castings, Lanco Project, Lanco Solutions, Lanco Global Systems Inc, Lanco Net, Lanco Leasing & Finance, Lanco Steel
 Managing Director  L Madhusudan Rao
 Post-issue Stake  65.65%
 Issue  
 Size  Rs 26.7 million
 Price  Rs 10
 On Application  Rs 5
 On Allotment  Rs 5
 Objective  Setting up a Software Development Center for web-based applications and consultancy, acquire a software company in the US, set up office in New Jersey
 Business  
 Product  Software services, Internet solutions, networking and systems integration
 Location  Hyderabad
 Project cost  Rs 118.57 million
 Funded by  Mainly equity and a term loan of Rs 12 million
 Kensource projections  (2001)
 Sales  Rs 50 million
 Profit  Rs 9 million
 Earnings per share  Re 0.84
 Forward P/E  12
 Post-issue share capital  Rs 106.57 million
 Return on equity  8%
 CommentPoor disclosures. 42% stake to be held by Lanco Solutions Inc. which is a loss-making company with huge borrowings to be used for investment!
 Rating *  D

* A=Subscribe & Hold ; B = Subscribe & Watch C=Subscribe & Sell ; D = Avoid

By Kensource Information Services Pvt. Ltd.

IPO Analysis

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