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Infosys Quarterly Profit Up 36 Percent

Posted by inet - 2005-10-12

NEW DELHI - India's second-largest software exporter, Infosys Technologies Ltd., said Tuesday its profit for the July-September quarter rose 36 percent from a year earlier to $137.7 million and raised its earnings estimates for the full year.
 
The company, which has 450 clients and mostly does subcontract work for Western companies — from software engineering to back-office work — attributed its performance to greater demand for outsourcing services and a weak rupee.

The Bangalore-based company's earnings beat market expectations and boosted the broader market, Dow Jones Newswires said. The Bombay Stock Exchange's 30-stock Sensitive Index, or Sensex, rose 0.7 percent to 8540.56 points.

Infosys forecast revenue of between $2.12 billion and $2.13 billion for the current fiscal year, higher than the $2.03 billion to $2.05 billion range forecast earlier.

Infosys, which is also listed on Nasdaq Stock Market, said the company's fiscal fourth quarter revenue will be "positively impacted" by the effect of a weak rupee on its software exports. The Indian currency fell 2.1 percent against the dollar in October.

"We see the rupee depreciating further. It will help our fourth quarter revenue," T.V. Mohandas Pai, Infosys chief financial officer, told Dow Jones Newswires.

Most Indian software companies, including Infosys, earn more than half of their revenue from exports to the U.S.

Indian shares ended higher Tuesday following its strong results.

"Infosys, as usual, beat market expectations on its profits, leading to buying in tech shares," said Umesh Solanki, consultant at Capital Services Equities. "The software sector, on the whole, will continue to do well as the falling rupee will improve yields on their exports."

Infosys gained 2.3 percent to 2,683.90 rupees ($60), HCL Technologies Ltd. rose 1.7 percent to 467.75 rupees ($10) and Tata Consultancy Services Ltd. rose 1.3 percent to 1,467.90 rupees ($32).

Infosys shares on the Nasdaq rose $1.73, or 2.4 percent, to close at $74.79.



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