INFOSYS UP THIS QUARTER
Friday, 18th January, 2008
Software major Infosys Technologies posted a 25.22% increase in its net profit at Rs 1,231 crore for the quarter ended December 31, bucking forecasts of a slow down on the back of rising demand from Europe, increase in prices of its services and a tax refund.
The company, whose revenue has crossed $3 billion in the first nine months of this fiscal, has also managed to tackle an appreciating rupee, besides a $26-million payout through voluntary settlement with the California division of Labour Standards Enforcement towards possible overtime payment to certain employees in California.
The revenue of the group increased by 16.90 per cent to Rs 4,271 crore for the December quarter, which was partly because of the tax reversal of Rs 50 crore. Its earnings per share increased to Rs 21.54 from Rs 17.64 for the corresponding quarter in the previous year. The company expects its revenue to grow 20 per cent in fiscal 2008.
For the fiscal 2008-09, revenues would be in the range of Rs 16,627 crore and the fourth quarter revenue would be in the range of Rs 4,477 crore versus Rs 4,501 crore. Infosys also claimed that it would not be affected by a shortfall in skilled manpower as forecast by Nasscom, the representative organisation of the IT sector.
Its human resources head T V Mohandas Pai said the company had finished hiring for 2008 and had already made offers to candidates for joining in 2009. Pai said the company had added 11,681 employees for the December quarter, taking the total number to over 27,000 so far this financial year. The company has a total strength of 88, 601 employees.
Chief financial officer V Balakrishnan, while explaining how the company had bucked the trend, said it had raised its prices by 2 to 3 per cent for existing clients and 3 to 4 per cent for new ones, Besides this, it has managed to add 47 new clients in the December quarter. It has also increased its revenue from consultancy and enterprise solutions to 24 per cent this quarter. On the downside, he said the rupee continued to be a worry and any drastic appreciation in its value vis a vis the dollar would impact the company.
Company’s head of banking and capital markets Ashok Vemuri said “we believe IT spending will be favourable to large offshore players like us even though the macro environment in challenging”.
Infosys’ CEO Kris Gopalakrishnan said though the US continued to be the company’s mainstay with 62.3 per cent share in total revenue, the present quarter had seen a 1.2 per cent increase in the European market, which now constituted 28.6 per cent of total revenue.
Gopalakrishnan said the company had established a separate cell to increase its business share in India, which had risen slightly from 1 per cent of total revenue to 1.2 per cent this quarter. He said the company was also focusing on Japan, China and Latin America to reduce over-dependence on the US due to the slowdown in the US economy.





