Mphasis net profit up 7.2% at Rs 208 cr

Aug 29 2012, 19:50 IST
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SummaryThe company had reported a net profit of Rs 194 cr in the corresponding quarter last fiscal.

IT and BPO services firm MphasiS today posted a rise 7.2 per cent in net profit at Rs 208.74 crore for the quarter ended July, 2012, on the back of improved operational performance.

The company had posted a net profit of Rs 194.80 crore in the third quarter of last fiscal.

Mphasis, in which HP owns more than 60 per cent, follows November to October financial year.

"Throughout the past nine months we have been working at driving operational efficiency which has pushed the growth.

Depreciation of rupee against the dollar also helped the revenues," MphasiS CEO Ganesh Ayyar said.

He, however, added that the impact of currency depreciation was "small because of the hedge plans in place".

The revenues increased to Rs 1,355.12 crore for the quarter compared to Rs 1,293.63 crore in the same quarter last year, the company said.

Direct business (non-HP business) revenues grew 48.3 per cent year-on-year and 12.6 per cent sequentially to Rs 633 crore. The mix between direct and HP business improved to 45:55 in Q3 FY12, from 33:67 in the year-ago period.

"Sustained focus on building our direct business is yielding results," he said.

MphasiS sees reasonable growth in the direct business in the mid-term (6-9 months period), while its HP business will continue to see challenging times.

During the quarter, the company added 24 new clients, of which 20 came through direct business and four through HP.

Ayyar said while the deal pipeline remains "pretty strong", the decision cycles are getting elongated.

Cash and cash equivalents increased by Rs 237 crore during the quarter to Rs 2,575 crore.

"We are on the lookout for acquisition. a dedicated team is working on that," Ayyar said.

He added the ideal company for acquisition would be with revenues in the range of USD 50-150 million, in the banking, capital markets and emerging services space.

On hiring, Ayyar said the company is looking to hire as per demand and not capacity. In the August-October quarter, the company hired 500 people.

The company's total head count stood at 37,637 at the end of the quarter.

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