The group has already picked up 25 per cent equity in a Chennai-based software company and has approved equity investments in two more IT start-up firms. Speaking to The Indian Express, Baring Communications Equity Asia Executive Chairman, Christopher K B Brotchie, said both the start-up firms had expertise in niche software areas. Baring was looking at more acquisitions and would pursue that route wherever it was "lucrative", being an investment company, he added. It had recently taken over the Bangalore-based BFL Software.

According to Brotchie, Baring picks up majority stake when there is a significant amount of restructuring to be done as in the case of BFL Software where it has a 52 per cent stake. Regarding BFL, he said it has no plans to divest or dilute its stakefor the next couple years. "IT in India has a globally competitive edge," he asserted.

Baring may divest its stake in BFL only seven years down the line, a senior executive from the software company said. BFL will issue the first instalment of employee stock options, announced earlier, in April 1999 at around Rs 275. It has projected a revenue of Rs 100 crore and profit after tax of Rs 22 crore for the current fiscal. Its top five clients account for 80 per cent of revenues and 85 per cent of its business comes from the US.

The company is setting up a Japanese development centre and an advanced centre of excellence in the US in addition to its existing software development centres in Bangalore. The company is also planning to expand its operations both in India and abroad.

It plans to issue an ADR within the next two years and is already moving towards it by adopting the GAAP system of accounting, S Sridhar, general manager (finance) revealed. He said the coming years will see reduced dependence onservices as it ventures into developing products. A product has already been developed for the healthcare segment.