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Infosys to sustain growth momentum: Nilekani (SECOND LEAD)

Bangalore, Oct 11 (IANS) Beating market expectations and its own guidance for the second quarter in a row, software giant Infosys Technologies Ltd is set to retain its growth momentum in the remaining two quarters of the current fiscal to cross the $3-billion mark in revenues.

Wednesday, October 11, 2006 | 7:51:06 PM IST (+05:30 GMT)
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Bangalore, Oct 11 (IANS) Beating market expectations and its own guidance for the second quarter in a row, software giant Infosys Technologies Ltd is set to retain its growth momentum in the remaining two quarters of the current fiscal to cross the $3-billion mark in revenues.

'We have seen all-round growth across verticals quarter-on-quarter (QoQ). Our robust organic growth coupled with investments in various strategic areas helped us to grow faster in this environment,' Infosys CEO and managing director Nandan M. Nilekani told IANS here Wednesday.

'In view of this sustained growth QoQ, we have revised our revenue guidance to cross $3-billion (Rs.13.9 billion) this fiscal,' he added.

On the impact of a perceived slowdown in the US economy, Nilekani said a dipstick survey revealed no effect on the company's performance or guidance, as its business model provided a compelling value proposition to its clients in a flat world.

'Though global IT spending is expected to remain flat, the globalisation process will enable our clients to outsource more of their IT requirements to negate the impact of a slowdown,' Nilekani asserted.

Registering a strong double-digit topline growth during the second quarter (July-Sep), the company has seen the pricing environment favourable, with new contracts being signed up at three-four percent higher billing rates and old contracts renewed at one-two percent higher rates than before.

'Reduction in visa costs, rupee depreciation and better price realisation have enabled us to improve our operating margins by 2.5 percent QoQ despite a wage increase,' Nilekani pointed out.

In the case of its business process management (BPM) operations, the second quarter had witnessed 20 percent sequential growth with Rs.1.57 billion in revenues and an operating profit of 23.3 percent.

Earlier, declaring its financial results for the quarter under review (Q2), the company said its net profit grew by a whopping 52 percent to Rs.9.3 billion ($199 million) and sequentially by 15 percent under the Indian GAAP.

Similarly, the consolidated revenue rose by 50 percent to Rs.34.5 billion ($746 billion), posting year-on-year growth of 50 percent and 14.5 percent sequentially (QoQ).

Copyright : Indo-Asian News Service
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