UPDATE 1-Infosys Q1 net falls 2.6 pct, raises annual outlook

* Quarterly profit 14.9 bln rupees vs 15.6 bln consensus

* Sees full-year revenue up 19-21 pct in dollar terms

* Infosys CEO says sees greater demand for services

* Shares down more than 2 pct after earnings
(Adds details)

BANGALORE, July 13 (BestGrowthStock) – Infosys Technologies Ltd
(INFY.BO: ) reported a surprise 2.6 percent drop in quarterly
profit but raised its full-year revenue forecast on hopes of
strong outsourcing demand from overseas clients.

India’s No. 2 outsourcer, a trendsetter in the country’s
showpiece software services sector, added 1,026 new staff in
April-June, its slowest pace of addition in four quarters,
sending its shares 2 percent lower.

The company, which counts Goldman Sachs (GS.N: ), BT Group
(BT.L: ) and BP (BP.L: ) among its more than 550 customers,
forecast its 2010/11 dollar revenue to rise 19 percent to 21
percent, higher than 16-18 percent projected in April.

“While the global economic environment remains uncertain,
we continue to see greater demand for services from our
clients,” said chief executive S. Gopalakrishnan. “The
challenge for the industry is to enhance the investment to grow
the business, given the uncertainty in the environment.”

Infosys, known for its conservative outlook, has raised its
full-year revenue growth forecast in dollar terms in the last
three consecutive quarters.

The company expects earnings per American depositary share
to rise 5.2 percent to 9.6 percent for the year, up from its
previous forecast of 4.3 percent to 8.6 percent.

Infosys shares, valued at about $36 billion, traded down
2.1 percent at 2,835 rupees after the results announcement. The
main Mumbai market (.BSESN: ) was down 0.1 percent.

On Monday, the shares had hit a record high for the second
session in a row.

Infosys and local rivals Tata Consultancy Services (TCS.BO: )
and Wipro (WIPR.BO: ) are boosting hiring and have raised
salaries by 10 to 20 percent on average to keep staff from
being poached by global rivals in a strong market.

Nasdaq-listed Infosys (INFY.O: ) said net profit in its
fiscal first quarter ended June 30 fell to 14.9 billion rupees
($318 million) from 15.3 billion rupees a year ago.

A Reuters poll of brokerages had forecast a profit of 15.56
billion rupees.

Infosys reported under the International Financial
Reporting Standards for the second successive quarter.

India’s export-driven software services firms face
uncertainty on orders from Europe, the second-biggest market
for the industry after the United States.

Growing competition from IBM (IBM.N: ), Accenture (ACN.N: ) and
Hewlett-Packard (HPQ.N: ) also pose a risk to the sector, which
manages complex computer networks and maintains technology
operations for Fortune 500 customers.
($1 = 46.8 rupees)
(Reporting by Bharghavi Nagaraju; Editing by Ranjit
Gangadharan and Anshuman Daga)

UPDATE 1-Infosys Q1 net falls 2.6 pct, raises annual outlook