Infosys Q2 net profit up 13.2% at Rs 1,737 cr

The IT bellwether’s consolidatedrevenue during the reporting quarter registered a growth of 24.4 per cent in revenues at Rs 6,947 crore as against Rs 5,585 crore in the corresponding quarter of the previous fiscal 2009.

Likewise, the company, registred a quarter-on-quarter growth of 16.7 per cent in net profit over previous quarter’s Rs 1,488 crore. The company’s revenue Quarter-on-Quarter (Q-o-Q) saw a growth of 12.1 per cent over previous quarter’s Rs 6,198 crore.

Briefing reporters, CEO & Managing Director S Gopalakrishnan said, “Though the economic environment continues to be challenging, we have leveraged our client relationships, solutions and investments to grow faster in this quarter. This is the first quarter after three years where we have achieved a double digit growth.”

It also declared interim dividend of Rs 10 per share and whopping 300 per cent special dividend of Rs30 as part of its 30th year celebrations. The record date for payment is October 22.

Expressing optimism about the Indian IT sector, he said: “there are significant drivers for investment in Information Technology since any transformation program to ‘build tomorrow’s requires these investments to be made. We are facing three major challenges namely the mutated economic environment, currency volatility and the regulatory challenges.” During the quarter under review, the company and its subsidiaries added 27 new clients. Infy and subsidiaries made a gross addition of 14,264 employees with net addition of 7,646 taking employee strength to 1, 22,468 people at the end of September 30, 2010. The company which witnessed one of its higher attrition rates in Q1 of FY 2010-11, managed to cut down its attrition in this quarter rate. The attrition rate for service business was 17.1 per cent.

Geographical performance

On a geographical basis, North America contributed the major chunk to its business with 65.8 per cent. The business from European continent also witnessed a sequential growth of 1.5 per cent and was at 21.8 per cent for period ending September 30, 2010.

Infosys Chief Operating Officer S D Shibulal said companies’ various initiatives including both operational and transformational work has helped it to perform well in second quarter. Share of our product businesses are also increasing every quarter, which itself is a significant achievement. During the second quarter, Infosys also applied for 18 patent applications both in India and in the US, taking the total number of pending patent applications to 256. The company which bagged 15 patents by the US patent and trademark office is planning to invest $62 million in R&D and also has a team of 2,500 people for R&D.

Asked about currency volatility Infosys CFO V Balakrishnan said, it is a major concern and RBI has to step in to resolve the issue or it might impact the export sector in the country.
Going forward for quarter ending December 31, 2010, the company expects revenue in the range of Rs 6,884 crore and Rs 6,953 crore with an expected Y-o-Y growth of 19.9 per cent to 21.1 per cent. For fiscal year ending March 31, 2011 revenue is expected to be in the range of Rs 26, 951 crore and Rs 27,165 crore with Y-o-Y growth of 18.5 per cent to 19.4 per cent.