Satyam Net Rises 55% To Rs 490.13 Cr

Hyderabad April 24: | Updated: Apr 25 2002, 05:30am hrs
Beating market expectations, the Hyderabad-based software major Satyam Computer Services Ltd (SCSL) has reported a 55 per cent growth in the net profit to Rs 490.13 crore for fiscal 2002 as against Rs 316.16 crore the previous year. The company’s board has recommended a final dividend of 35 per cent taking the total dividend to 60 per cent for the financial year ended March 2002.

However, an extraordinary charge has been made to the tune of Rs 40.75 crore pertaining to writing off certain investments in the marketing subsidiaries that were merged with SCSL in the last quarter. This has reduced the profit after extraordinary items to Rs 449.37 crore.

For 2001-02, the company has posted a total income of Rs 1,803.09 crore, a 45.21 per cent increase over the total income of Rs 1,241.67 crore in the previous fiscal. While income from software exports amounted to Rs 1,703.07 crore, domestic sales was Rs 28.86 crore.

Expands China Operations

During the last quarter SCSL launched operations in China as part of its aggressive expansion plan in the Asia-Pacific region. SCSL proposes to set up ‘software development center’, in cooperation with the Shanghai Pudong Software Park, for servicing its global clients operating from China and related market. “Besides providing service to China-based companies, we propose to extend our China operations to other multi-national companies operating in China,” Mr Raju said. Once the centre is established it would become the 15th facility of the company, he added.
The company has already servicing 3 Chinese companies and expecting some more companies to its kitty. Mr Raju said that the China operations were showing positive signs but however declined to give any numbers.

The other income increased from Rs 21.68 last year to Rs 71.15 crore for the year under review.

SCSL chairman B Ramalinga Raju said, “Despite the weak economic scenario in the major markets, which is a source of concern for IT services companies, Satyam addressed the problem by strengthening the client relationships and through enterprise solutions offerings.” The strategy worked for the company, as it could get 24 new clients during the quarter under review, including four Fortune 500 companies.“We continue to compete successfully with global IT services companies in winning new customers,” Mr Raju said. The client strength of the company has increased from 208 to 263 during the year, while 60 companies are from Fortune 500.

In the last quarter, the company has posted an 18 per cent increase in sales. The operational margins remained at the same level as the first quarter of 2000-01 fiscal. But the net profit has been impacted adversely by higher tax provision.

For the current year, Mr Raju had forecast a growth rate of 18 to 20 per cent in dollar terms in the software service business. “The income from software services would be between Rs 2,091 crore and Rs 2,126 crore with an operating margin of 32 per cent,” he added.