Income from overseas software development services and products contributed Rs 168.62 crore (Rs 96.38 crore in the first quarter of 1998) to the Rs 184.06-crore total income (Rs 98.43 crore), with exchange rate fluctuations chipping in Rs 3.62 crore (Rs 5.11 crore) towards income from its business. At home, the company did business worth Rs 1.65 crore.

Of the other income of Rs 13.79 crore, exchange rate variations contributed Rs 8.13 crore. Interest on deployment of funds mopped up through the issue of American depositary shares (ADSs) added Rs 3.52 crore to Infosys' other income.

Operating profit also shot up by around 150 per cent to Rs 77.93 crore (Rs 31.61 crore). After providing Rs 9.32 crore (Rs 4.94 crore) towards depreciation and Rs 8 crore (Rs 3 crore) astax, the net profit stands at Rs 60.61 crore (Rs 23.67 crore) for the period under review.

Even after excluding the exchange differences and interest earned on the ADS kitty, the net profit works out to Rs 48.96 crore -- a 106.84 per cent increase over the last quarter.

Infosys' paid-up capital moved up to Rs 33.07 crore from Rs 16.02 crore through a 1:1 bonus issue and the ADS issue. Both allotments were made in March 1999.

As per the unaudited quarterly results prepared according to the US generally accepted accounting principles (GAAP), the earnings per ADS works out to $0.16 for the quarter.

A provision of Rs 3.33 crore has been made for its Y2K contingency plan in the first quarter to meet any possible disruption in customer support. No fresh investment has been earmarked for its loss-making subsidiary Yantra Corp.

In line with expectations

Considering the reaction of the stock market to Infosys' results, it can be safely said that the company's performance was to some extent in linewith market expectations. The stock opened on the upper circuit but retreated on the announcement of the results.

A 156 per cent jump in bottomline in the first quarter of the company is in spite of higher tax provision and 100 per cent increase in depreciation and provision for contingencies. These, however, were offset by benefits on account of the depreciation in the rupee. The company has benefited from a topline growth of 75 per cent and improvement in operating margins from 32.5 per cent to 39.6 per cent.