The Hindu Business Line : Infosys net climbs 51 pc in third quarter

INFOSYS Technologies reported a 51 per cent growth in its profits for the third quarter at Rs 497.34 crore, and a 49 per cent rise in revenues to Rs 1,875.61 crore, over the corresponding period in the previous year.

With a strong interest in outsourcing, it has given a revenue guidance of Rs 1,956 crore-Rs 1,964 crore for the last quarter of this fiscal. Full-year revenues are expected to be between Rs 7,098 crore and Rs 7,107 crore, a lower-than-forecast 46 per cent growth due to the rising rupee. Earnings per share are expected to rise 47 per cent for the year.

"This was a quarter of robust growth and strong outsourcing demand," said the CEO, President and Managing Director, Mr Nandan Nilekani.

Despite positive results, share prices of the tech pivotal on Wednesday closed lower by 3.4 per cent at Rs 1,903.35 on the BSE in line with the broad market.

"We have maintained our margins despite an appreciating rupee," said the CFO and board member, Mr T.V. Mohandas Pai.

"We will continue to watch the rupee movement and take appropriate hedging positions," he said, adding that the impact of the rise in the rupee was to be expected as 78 per cent of the company's revenues came in dollars. For the fiscal, the adverse impact of the quarter's 6 per cent rise in the rupee has been to the tune of Rs 187 crore.

"Pricing is stable with an upward bias," said Mr Pai, adding that new clients were coming in at 4-4.5 per cent higher rates, and existing clients would likely agree to higher rates too.

According to the Head (Worldwide Sales) and Senior Vice-President, Mr Basab Pradhan, there has been customer interest in the company's consulting and offshore delivery services. Infosys added 38 new clients during the quarter.

Financial services and telecom service providers are major customers, and "we are seeing traction in these verticals worldwide," said Mr Pradhan.

Insurance, banking and financial services contributed 35.2 per cent of the quarter's revenues, followed by telecom at 18.1 per cent and manufacturing at 14.3 per cent. There are opportunities for mining existing clients, and Infosys will also push its BPO offerings.

On the recruitment front, the Senior Vice-President, HR, Ms Hema Ravichander, said we will hire a gross of 2,000 people and are on track for our manpower plan. The company has made about 6,000 offers at over a 100 campuses and expects people to join in the second quarter of 2005-06.

During the quarter, Infosys added a net of 2,280 people, taking the total headcount to 35,229 as on December 31, 2004.

"Our focus on creating synergies through Infosys Consulting and Progeon at either end of the services chain has increased our competitiveness," claimed the COO and board member, Mr S. Gopalakrishnan. Infosys' China division will hire about 2,000 people in 18-24 months and has secured 18 clients, although it is still in the red by Rs 3.57 crore since it is in the investment phase, Mr Nilekani said.

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