Infosys Tech operating margins improve

Sarad Saraf

Mumbai, Apr 11: The fourth quarter results of Infosys Technologies' are in line with market expectations. Most market players had projected a net profit in the region of Rs 45-50 crore for the quarter ending March and the company has, in fact, posted a net profit of Rs 43.10 crore after providing for contingencies of Rs 3.30 crore. Consequently, one may say, the stock declined marginally to close at Rs 2,607 on Friday. However, there are some analysts who say that the decline has more to do with a falling market than anything else and expect the market price for Infosys shares to double in the next two years.

The total income from software development, of which overseas income accounts for over 95 per cent, has risen by a whopping 93 per cent to Rs 151.92 crore. Other income as a percentage of pre-tax profit has remained more or less unchanged at around 3.4 per cent. Operating profit has seen an increase of around 138 per cent to Rs 64.97 crore. What is really remarkable is that margins have shown atremendous improvement. Operating margins have, for instance, risen from 34.80 per cent to 42.76 per cent.

Though depreciation expenses have increased by 94 per cent, pre-tax profits have more than doubled from Rs 20.60 crore to Rs 52.33 crore. Pre-tax margins have improved from 25.97 per cent to 34.05 per cent. Foreign exchange fluctuations have added Rs 9.36 crore to the topline and Rs 4.40 crore to the bottom line which has risen 143 per cent.

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