Infosys impresses market with 117 pc jump in profit

Infosys said in a statement that fourth quarter E-commerce revenues rose to 18.8 per cent of total revenues from just five per cent in the year-ago period and announced it was entering new technology areas such as M-commerce – E-commerce enabled by wireless devices like mobile telephones. It also announced a tie-up with Japan’s Toshiba Corporation to provide the software for managing Toshiba’s supply-chain operations.

The market was expecting a rise of 105 per cent in net profit of the company. With the company’s results exceeding expectations, Infosys shares were up nearly eight per cent, or Rs 786, at 10,625 on the Bombay Stock Exchange (BSE). The firm’s shares, carrying the highest weightage in the main BSE index at around 18 per cent, have gained 40 per cent in value in the past week but are still some 17 per cent down from a peak of 12,789.5 hit in early March.

“What is even more impressive is the fact that for the 28th quarter in succession, ever since we went public in 1993, we have been able to show growth in both top line and bottom line," Narayana Murthy, chairman and chief executive officer, said in a presentation after results were announced.

"Clearly, the business for E-commerce is really booming," Infosys Managing Director Nandan Nilekani said, “We have also been able to increase our capacity utilisation in this (fourth) quarter and get more people on billable projects." Infosys said it added 99 new clients during 1999-2000 of which 11 were E-commerce-related firms and 25 were Internet-related companies.

Three new Software Development Centers at Mohali, Hyderabad and Mysore commenced operations during the last quarter. The company’s first Global Development Center was inaugurated in Toronto, Canada, during the quarter.Two more software development blocks with a total capacity to accommodate 1,200 personnel were completed at Infosys Park, Phase II in Electronics City, Bangalore.

Murthy said revenues from E-commerce related business in the three months ended March 31, had jumped to 18.8 per cent of total revenue against five per cent in the year-ago period. A statement from the company said that during the same period, revenues from fixing the "Millennium Bug", or Y2K problem in computer systems, had declined to 0.9 per cent of total revenues from 15.2 percent in the year-ago quarter.

"The company’s early initiatives to actively E-enable its clients continue to bear positive results," the statement said. "Demand for E-commerce services, an area where the company has a proven track record, continues to drive our revenue growth," he said, adding, "New opportunities in the form of M-Commerce (mobile E-commerce) are fast emerging and we are well positioned to take advantage of them."

Earlier in a presentation on the Internet, Infosys said that it had added 35 new clients in the three months ended March 31, and 99 in all during 1999/2000 (April-March). "Of this, 11 and 25 are in E-commerce and Internet areas respectively," Infosys said.