We've done the SPNEGO Implementation for Portal SSO.
All the settings related to KDC in AD server, Portal WAS and IE browser client settings have been done.
In most of the machines with WINDOWS XP SP2, portal login screen is not getting appeared in IE and so SPNEGO is working fine.
But in few machines with WINDOWS XP SP2, portal login screen appears although the IE client setting like adding the portal url in Security Local Intranet, enabling integrated windows authothentication, enabling automatic logon in intranet zone is done.
We have even followed the SAP Note 934138 and installed Microsoft hotfix KB899587, but still some machines with Windows XP SP2 are facing this issue.