Business | Technology
Infosys profit rises 10% in quarter
Infosys Technologies, India's No. 2 software services exporter, reported a near-10 per cent rise in quarterly profit and gave a confident medium-term outlook, sending its shares up five per cent, even as a slowing US economy hits outsourcing deals.
- Reuters
- Published: 00:17 April 16, 2008
Bangalore: Infosys Technologies, India's No. 2 software services exporter, reported a near-10 per cent rise in quarterly profit and gave a confident medium-term outlook, sending its shares up five per cent, even as a slowing US economy hits outsourcing deals.
Nasdaq-listed Infosys, the first in India's estimated $64 billion software services sector to report results, forecast revenue for the year to end-March 2009 would grow 19-21 per cent to $4.97-$5.05 billion, slowing from a rise of 35 per cent last year.
India's software services sector has been hit by slower growth from battered banks and financial firms, sectors that contribute most to the industry's revenue.
Opportunities
"While there could be short-term challenges due to global economic uncertainties, we see significant growth opportunities in the medium to long term," chief executive S. Gopalakrishnan said.
Shares in Infosys rose five per cent to Rs1,497.1 by 0610 GMT, helping support the broader market, which edged up 0.2 per cent. The stock was boosted by an increase in the dividend pay-out ratio to up to 30 per cent of net profit from 2008/09 from 20 per cent, analysts said.
"As a yield it changes little, but what it does is improve sentiment, and that is reflected in the share price movement," said Ambareesh Baliga, vice-president of Karvy Stock Broking.
Helped by an army of English-speaking workers and cheaper wages, India's soft-ware services sector has thrived by winning deals from overseas clients, with the US accounting for more than half of the sector's revenue.
Infosys remained confident, despite market expectations its growth will slow.
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