| Growing Infosys prepares for bigger orders |
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European revenues
grew by slightly less
than 50% in Q3, to reach
$139m for the quarter,
now accounting for 25%
of worldwide revenues
(up from 22% in Q3
2005).
EMEA is now not only
the company's
fastest-growing
geography but also its
most profitable in
operating-margin terms.
The region's profit
margins of 36% are 3
percentage points higher
than in the US, thanks
to a higher proportion
of outsourcing and more
profitable discretionary
projects.
Infosys is seeking
bigger orders from its
206 customers that each
earn the company annual
revenue exceeding $1m.
That would help Infosys
double sales to a | |
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| | projected $2bn-plus in
the year ending March
31, after surpassing the
$1bn mark in March 2004.
The company also said
it was building a
"deeper bench", hiring
or keeping more people
that it currently has
work for. While this
would cost Infosys an
estimated 50-75 basis
points in margin, large
numbers of staff who can
be deployed quickly on
new contracts would
allow the company to bid
on bigger contracts.
Infosys continues to
invest in its consulting
subsidiary, Infosys
Consulting, delaying its
break-even slightly
because it has stepped
up its hiring.
In October Infosys
said it earns about 40%
of its revenue from
services, including | |
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| | consulting and computer
network management, that
it started in the past
five years.
In the report
Forrester Wave: Indian
Vendor Consulting
Capabilities, Stephanie
Moore of Forrester
Research said:
"Infosys...is best
positioned to offer
high-value management
consulting skills. Of
all the vendors profiled
[in the report], Infosys
is most able to compete
with both the former Big
Five firms for business
process consulting work
and the tier-one Indian
vendors for the
follow-on technical
work."
The company raised
its full-year
earnings-per-share
forecast to 89.9-90.3
rupees ($2.03-$2.04), or | |
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| | 30.7-31.3% growth
against 29.4-30%
estimated previously.
Infosys said its
profit was impacted by
about $2m because of the
rupee's volatility.
While the depreciation
of the rupee during the
quarter - 2.3% -
resulted in a benefit of
$10.3m, the company lost
$12.6m on hedging costs.
The company added 36
customers in the third
quarter after gaining 70
clients in the first
half of this fiscal
year, taking its total
client base to 454.
Infosys employed
3,226 more people in the
three months ended
December 31 after adding
6,390 workers, its
highest ever in a
quarter, in the
preceding three months.
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| | Infosys Technologies,
which reported
third-quarter results in
line with market
expectations, raised its
full-year profit and
sales forecasts for the
second time this fiscal
year.
It said net profit in
the third quarter ended
December rose to 6.49bn
rupees ($147m) from
4.97bn rupees in the
same period a year ago,
a 31% rise, while
revenue rose 35% to
25.32bn rupees.
The results compared
with a consensus net
profit of 6.49bn rupees
on revenue of 25.21bn
rupees in a Reuters poll
of industry analysts in
10 brokerages.
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