BANGALORE, INDIA: IT major Infosys continued its impressive growth trajectory clocking a net profit of Rs 1,231 crore for the quarter ended 31, 2007, a 25 per cent rise compared to the corresponding quarter last fiscal.
The net income was aided by reversal of tax provisions amounting to Rs 50 crore.
Revenues stood at Rs 4,271 crore, up 17 per cent over the same period last year. On a sequential basis, net profit increased by 12 per cent while revenues went up by 4 per cent.
The operating margin increased to 32.59 per cent from 31.27 per cent on a sequential basis.
In the quarter under review, the company added 47 new clients. "We have many deals in the $50-$100 million range this quarter. We are focusing on winning more such large deals," said SD Shibulal, COO, Infosys.
The rising rupee continued to be thorn in Infosys's side. The rupee appreciated by 1.9 per cent in the quarter but its impact was offset by gains by way of $26 million in tax reversals and productivity gains.
"The rupee appreciation is challenging and we are worried about the pace of appreciation," said Shibulal.
On the issue of a possible slowdown in customer spend due to slowdown in the US economy, Kris Gopalakrishnan, Infosys CEO and MD said that the customer environment continued to be robust. "We have seen good growth in BFSI, Telecom and manufacturing. The trends driving growth are customer demand for consolidation of servers and the data centers; increasing interest of enterprises in emerging countries and also evolution of technologies such as convergence and unified communication."
Post-Reorg changes
This quarter is the company's first after its decision to reorganize its business units along vertical lines and growth markets in November 2007. Shibulal said that the company is focusing on increasing business in India not just from Finacle but also system integration projects and platform based solutions.
The company is also offering SaaS, platform based BPO and other solutions, he added. A significant change this quarter is the change in the Application, Development and Maintenance (ADM) services mix.
For the first time at Infosys, ADM, which used to the primary revenue staple for the company has decreased and now accounts for 46 per cent of the total revenues.
Human resources
The company added 11,683 employees to its rolls for the December quarter taking the total number to over 27,000 this fiscal. The total employee strength of Infosys and its subsidiaries was 88,601 for Q3 08.
It also saw a net addition of 8,100 employees during the period. The total employees of Infosys and its subsidiaries stood at 88,601 as on December 31, 2007.
TV Mohandas Pai, Infosys Head (HRD) and Education & Research, said that the company is looking at hiring students from non-engineering streams such as BSc and other graduates thereby expanding the talent pool. "These graduates can be trained for testing and verification jobs."
During the quarter, Infosys applied for an aggregate of 16 patents in the US and India. With this, Infosys has filed an aggregate of 109 patent applications (pending) in both countries and has been granted 2 patents by the US Patent and Trademark Office.
The company said it has voluntarily settled with the California division of Labor Standards Enforcement (DLSE) towards overtime payment of certain employees in California for a total amount of $26 million. The payment pertains to the last three years and such back wages will be paid to the employees in due course.
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