DSQ Software, formerly known as Square D Software, has already announced a 86 per cent rise in net profit in the first quarter. Satyam, too, is expected to announce a jump in net profit of around 80 per cent to 100 per cent. CMC is also likely to double its net profit in the fiscal driven by new product launches, including a software package for insurance industry.

The rupee fall from Rs 33.8 in April 1997 to the current level of Rs 42.5 has aided the surge in earnings for these software companies as more than 95 per cent of their income is in the form of foreign exchange.

Software scrips have already shot up in the past few sessions inexpectation of excellent quarterly results. The scrip rise has been supported with a surge in trading volumes. Further, various path-breaking recommendations by the national task force on information technology and software development also fuelled the rally in software stocks.

The proposals include introduction of sweet equity to IT employees, blanket approval for Indian IT companies to acquire foreign companies and zero duty on all IT products by 2002. It also suggested a 100 per cent depreciation on all IT products in two years.

Even before Sebi announced the mandatory reporting of quarterly results, Infosys had started disclosing the unaudited quarterly figures in 1997-98. According to market expectations, Infosys Technologies' net profit for the first quarter ended June is likely to be around Rs 18 crore against Rs 9.22 crore reported for the corresponding period of last year (1997-98).

Last year also, the Bangalore-based company doubled its quarterly net profit to Rs 9.22 crore against Rs 4.55crore in the first quarter of 1996-97 on a 87 per cent growth in turnover to Rs 45.8 crore.

On an expanded equity base of Rs 16.02 crore (post 1:1 bonus), Infosys' earnings per share on an annualised basis works out to around Rs 45 which discounts the current price by a price-earnings multiple of around 55.

Another software major, Satyam Computers, is expected to announce a net profit of around Rs 14 crore which is almost close to its first-half net profit of Rs 15.07 crore last year. The company reported a 70 per cent jump in net profit to Rs 36.57 crore on a 100 per cent growth in turnover to Rs 179.8 crore.

DSQ Software has already reported a 85.7 per cent jump in net profit for the first quarter to Rs 8.84 crore from Rs 4.76 crore. Turnover more than doubled to Rs 42.18 crore for the first four months ended June 1998 against Rs 116.78 crore for the year ended March 1998. Infosys Technologies' scrip has zoomed by almost Rs 400 in the past three sessions to touch Rs 2,525 on the National StockExchange (NSE) and Rs 2,510 on the Bombay Stock Exchange (BSE).

It is again inching towards its 52-week (bonus adjusted) high of Rs 2,625. Infosys' scrip rise was also supported with huge trading volumes on July 7 which suddenly shot up by 172 per cent and 74 per cent to touch 1.6 lakh and 1.4 lakh shares on BSE and NSE respectively. On July 8, Infosys shot up by Rs 112 (4.6 per cent) and volumes rose further to 1.83 lakh on the NSE and 1.37 lakh shares on BSE.