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$3-bn revenue blip on Infy screen

Bangalore/Mumbai, Oct. 11: Software giant Infosys Technologies expects to ratchet up its revenues to $3 billion this year — which means the infotech company will cross another $1-billion milestone in a space of just 12 months.

Infosys took 23 years to cross $1 billion revenues back in 2004; in April this year, it topped $2 billion.

Powered by another stream of robust revenues and earnings numbers in the second quarter ended September 30 that galloped ahead of market forecasts, Infosys reported a 51.3 per cent jump in net profit at Rs 896 crore against Rs 592 crore in the same period last year.

Most observers had expected the Bangalore-based infotech services company to report profits in the range of Rs 850-870 crore on a consolidated basis, but Infosys announced a net profit of Rs 930 crore, up 52 per cent from Rs 606 crore in the same period last year.

But there was a story behind the numbers that illuminated the performance and lifted the pall of gloom cast by Cassandras: Infosys toted up an increase in volumes and nudged up its margins.

The recent talk of a slowdown in the US economy didn’t faze the Infosys team when they gave out their guidance for the third quarter and the full year.

“Our clients are seeing robust growth and we are not seeing any sign of a slowdown in tech spends in the US,” said Nandan M. Nilekani, CEO and managing director of Infosys.

The company expects billing rates to remain stable for the rest of the year.

The Infosys stock surged almost 4 per cent to close the day at Rs 1,981.35, a gain of 3.95 per cent over the previous close of Rs 1,906. Its rub-off was felt in other IT companies with analysts maintaining a favourable bias on the sector as a whole.

“Infosys usually sets the benchmark for the entire information technology sector. We now believe that others are unlikely to disappoint,” an analyst added.

For the quarter, Infosys reported a consolidated income of Rs 3,451 crore against Rs 2,294 crore while it stood at Rs 3,273 crore (Rs 2,170 crore) on a standalone basis.

During the period, Infosys and its subsidiaries added 45 new clients and there was a gross addition of 10,795 employees (net 7,741). The total number of employees for Infosys and its subsidiaries stood at 66,150 as on September 30.

The company has declared an interim dividend of Rs 5 per share compared with Rs 3.25 per share for the same period last year.

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