Syntel net income grows 21 per cent to Rs 98 cr for Q3 2008

Mumbai, Oct 25 (UNI) Syntel Inc, a US based global information technology services and Knowledge Process Outsourcing (KPO) firm, has posted net income up by 21 per cent to Rs 98 crore (USD 22.1 million) for third quarter ended September 30, compared to Rs 81 crore (USD 18.3 million) in the same period last year.

Syntel's total revenue for the third quarter increased 18 per cent to Rs 460 crore (USD 103.8 million), compared to Rs 390 million (USD 87.9 million ) in the prior-year period. The Company's gross margin was 44.3 per cent in the third quarter, compared to 39.8 per cent in the prior-year period (450 bps increase).

Syntel's income from operations expanded to 25.2 per cent in the third quarter, compared to 19.0 per cent in the prior-year period (620 bps increase) .

During the third quarter, Syntel added 10 new clients and two new ''Hunting Licenses'' or preferred partnership agreements, bringing the total number to 92 strategic relationships. Syntel has added 26 new clients in 2008.

''Syntel was able to post healthy earnings during the quarter.

Utilization levels were increased and employee productivity was improved. We are most pleased with the fact that we were able to deliver this earnings performance without sacrificing the key investments necessary for the long-term health of our business.

Based on the current economic environment, we are cautious in our outlook for the upcoming quarter and early 2009, and have adjusted our guidance accordingly,'' company's President and Chief Operating Officer Keshav Murugesh said.

''We remain optimistic, however, about the health of our growing business pipeline and the overall positioning of the Company. We continue to invest in target markets, verticals and services to help our customers achieve their business objectives, '' he added.

Syntel will now invest close to Rs 155 crore in 2008 alone as it makes progress on construction of its new SEZ's in Pune and Chennai, Mr Murugesh said.

Phase 1 with 2,300 seats in Pune will be ready by fourth quarter 2008 and Phase 1 of our new Chennai campus will be ready by second quarter of 2009, he added.

Based on current visibility levels and an exchange rate assumption of 48.8 rupees to the dollar, the Company is updating 2008 guidance to reflect revenue of USD 408 (Rs.1991 crore) to USD 412 (Rs.2010 crore) million and Earning Per Share (EPS) in the range of USD 1.88 to USD 1.93, Mr Murugesh said.

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