MUMBAI, Apr 14: Investment Banker Goldman Sachs has said that of the 50-odd software scrips listed on stock exchanges, it was certain some would not meet their targets. "It has happened in the US, there is no reason why it will not happen here," Vikrant Raina, executive director, Goldman Sachs Asia, said. "Stick with the biggest and the best," securities analyst Rajeev Gupta advised at a press conference to announce its software conference for international investors at Hyderabad. The two-day conference will start on April 15 and will comprise around 35 investors who jointly have over $ 1 trillion under management. Over 20 software companies will participate in the event to be inaugurated by Andhra Pradesh Chief Minister Chandrababu Naidu."This is by far the largest investment pool ever exposed to the Indian software industry," the investment bank said about the conference. Meg Saegebarth, vice-president and head of the firm's coverage of IT service stocks said, "Targeting $ 50 billion worth of softwareexports by the year 2008, India is on the threshold of becoming an IT superpower."She said Y2K still had export potential, particularly to Europe and other Asian countries and recommended e-commerce, audio-video interactive systems and internet software as areas which held promise for the future. "IT majors in the US get better rating in the stock markets due to their involvement in the systems of emerging technologies, besides ensuring the best performance, timely execution of projects and seeking higher volumes of business," Saegebarth added.Gupta said the strongest buy under the present market conditions was NIIT. "They have diversified in the right direction and are very focussed in their approach," he said, adding that the software company's managers in Europe, US and the rest of Asia were more impressive than that of other Indian IT companies. This also contributed significantly to the company's strengths because ultimately it was a "people's game".He said there was a lot of hype in theinfotech sector but there were quite a few gems among the software stocks. On the other hand, he said, there were some companies which clubbed their non-software revenues under software. On the disproportionate market capitalisation of software firms, Raina said markets were rewarding them for future growth. "You don't invest in the sector you invest in companies," he said.On venture capital for software firms Raina said, "A lot of money would like to come to India." Last December, Goldman Sachs, as principal promoter, helped Indian IT entrepreneur Arjun Malhotra to launch Techspan Inc, a US-based software consulting company with a wholly owned Indian subsidiary.The bygone year has been the year of infotech companies, which have witnessed double-digit growth rates despite the prevailing recessionary conditions in the economy. Stock markets have rewarded such companies with higher discounting and even the relatively unknown players have seen their share prices more than double during the year. Shareprices of RS Software, RAM Informatics and Infotech Enterprises have appreciated by 566%, 300% and 433% respectively.
