Financial Daily from THE HINDU group of publications
Wednesday, Jul 13, 2005
Financial Daily from THE HINDU group of publications Wednesday, Jul 13, 2005 |
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Info-Tech
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Outlook Money & Banking - Forex Infosys may start hedging euro earnings Our Bureau
Bangalore , July 12 HIT by an appreciating rupee against the euro, Infosys Technologies is expected to start hedging its euro-denominated earnings. "We are looking at it seriously," said Mr T.V. Mohandas Pai, Chief Financial Officer, Infosys. The loss of revenues was Rs 10.94 crore as euro depreciated against the rupee by 4.74 per cent during the quarter. Infosys did not consider hedging its earnings in European currencies so far as it accounted for a small portion of the overall revenues. About 78 per cent of Infosys' earnings are billed in dollar terms, about 7 per cent in Australian dollars and about 11 per cent in euro and pound put together. Mr Pai said the rupee has appreciated by 0.14 per cent against the dollar this quarter, 3.17 per cent against the pound sterling and 4.7 per cent against the euro. The impact of rupee appreciation is about 5.4 per cent on operating profits, he said. Total negative impact due to the currency fluctuation is to the extent of Rs 14.94 crore, Mr Pai added. Infosys has taken a forward cover for $261 million in the current quarter, he said. Finacle goes global: Infosys said that its universal core banking solution Finacle was making strides in the developed market by expanding its footprint. Finacle, hitherto, confined to the domestic market has found good number of takers in the developed markets such as Australia, Singapore, the UK and Switzerland. "Finacle has slowly started to make an impact in the developed market," said Mr S. Gopalakrishnan, Deputy Managing Director and Chief Operating Officer, Infosys. Finacle, which has a customer base of 87 installations spread over 47 countries, accounted for 4.7 per cent of Infosys' total revenues during the first quarter as compared to 3.4 per cent in previous quarter. "The US market, which is running on legacy systems, would be ready down the road for Finacle as banks are expected to migrate from the legacy systems over the next few years," said Mr Girish Vaidya, head of Infosys' banking business unit.
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