HIGHLIGHTS-Infosys executives on margin, demand, price

BANGALORE, Oct 15 (BestGrowthStock) – Infosys Technologies
(INFY.BO: ) (INFY.O: ), India’s No. 2 outsourcer, raised its annual
revenue forecast on Friday after topping quarterly profit
estimates, but a weaker dollar could crimp growth for the
export-driven firm.

For the results, see [ID:nSGE69C0D2]

Following are comments from senior company officials after
the result.

V. BALAKRISHNAN, CHIEF FINANCIAL OFFICER

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ON MARGINS, PROFIT:

“Margins could get impacted because of rupee. If you look
at it, rupee has appreciated close to 4.5 percent that will
have an impact of around 1.5 percent on the operating margin.

“This year tax rate has gone up for us, that will have an
impact of 1.3 percent. At net income level, we could have close
to 2.5-2.6 percent impact that is purely due to currency and
taxes.”

OUTSOURCING DEMAND, PRICING:

“The environment is good but the uncertainty still remains.
Because if you look at all the macro numbers, most of them are
negative, both in the U.S. and Europe. Clients are very
cautious, but overall we are seeing the volume momentum
continuing. Pricing is stable. So, a good environment to be in.

“We are not seeing any great uptick or great downtick but
absolute pricing remains the same. We have seen uptick in Q2,
we are assuming that will continue for the rest of the year.
That means on an average basis it could be similar to what we
have seen last year.”

OUTLOOK FOR IT SPENDING:

“Looking at the uncertainty, I think people will take a
very short-term view on budgets. Probably they will look at a
quarterly budget and going forward they will decide whether to
spend or not depending on the macro environment.”

S.D. SHIBULAL, CHIEF OPERATING OFFICER

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OUTLOOK FOR IT SPENDING:

“Overall the last half and a quarter have been excellent
for large deals and transformational deals …

“Last year, even after the budgets were closed, they were
not spending. This year, they are spending. Next year budgeting
will be conservative. Spend will depend on multiple factors we
have to wait and watch.”

DEALS:

“If you look at the client base, during the downturn, they
had lost profitability; they have now gained it back.

“Now they are looking at the future, they are talking about
growth, how do you grow the organization? And for that they
need to create dollar for investment, so they are looking at
return on investment.

“So, there are transformational programs which we are
seeing, outsourcing programs which we are seeing.”
(Reporting by Bharghavi Nagaraju; Editing by Ranjit
Gangadharan)

HIGHLIGHTS-Infosys executives on margin, demand, price