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Increase in operating margins helped Infotech Enterprises double its net profit in the fourth quarter ended March 31, 2012, to Rs 70 crore from Rs 37 crore in the same quarter last year.
Operating margins went up to 19.8 per cent from 14.3 per cent in the quarter.
It posted revenues of Rs 417.35 crore (Rs 326 crore) in the fourth quarter, showing a growth of 28 per cent.
“We are expecting a dip in the first quarter of new financial year as we are planning to increase wages. For the remaining same levels of margins what we witnessed last financial year,” Mr B.V.R. Mohan Reddy, Chairman and Managing Director of Infotech, said.
Wage hike
It plans to increase salaries by 8-10 per cent for staff in India and 2 per cent . for foreign centric staff.
Addressing a press conference here on Wednesday, he attributed increase in revenues to growth in engineering services division. This division contributed Rs 1,077 crore (Rs 822 crore) in 2011-12, contributing 69.3 per cent to overall revenues.
The company, which has a cash balance of Rs 479 crore, announced a dividend of 25 per cent, taking the total dividend to 50 per cent on a Rs 5 share. North America contributed increased to 57.4 per cent (55.3 per cent), followed by Europe 32 per cent (36.3 per cent) and Asia-Pacific region 10.6 per cent (8.4 per cent).
Mr Krishna Bodanapu, who used to head engineering services practice and son of Mr Mohan Reddy, has been elevated to President and Chief Operating Officer, Mr John Renard will head Utilities and telecom vertical, while Mr Rajendra Velagapudi will take care of the newly-created aerospace business unit. Mr Anand Parameswaran will head another new vertical called HTH or Heavy equipment, transportation and hi-tech.
SEZ strategy
Infotech would have about 1,000 employees to its leased facility in Hyderabad by the year end, helping it to reduce tax outgo by 1.5 per cent to 2 per cent.
“We will have net additions of 1,500 employees this year, including 30 per cent freshers. We already hired 400 from colleges. We have 9,334 staff now,” Mr Ashok Reddy B, who heads HR for Infotech, said.
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