Infosys signals sector recovery, boosts tech stocks

Mysore, Jan 13 (ANI): Infosys Technologies, India's No.2 outsourcer on Tuesday reported a 2.8 percent rise in its third quarter.

The company raised its annual sales forecast as big financial services clients boost orders in an improving global economy, pointing to an industry recovery.

The company added 32 new clients taking the total number to 568.

"This quarter has been an excellent quarter, all-round a very good performance. We added 32 new clients, our top clients grew by 12.2 percent, which is almost doubled...we have also added almost seven to eight thousand employees," said Kris Gopalakrishnan, CEO and Managing Director.

The company, a trendsetter for the 60 billion dollars Indian outsourcing sector, expects spending on outsourcing to go up but said the appreciating rupee could hit profit margins in the short term.

"There is a concern but it is becoming smaller and smaller, lesser and lesser in terms of whether the recovery really taken a hold upon. The US economy has grown by 2.8 percent last quarter, which is again a good sign," said Gopalakrishnan.

Infosys shares rose 4.0 percent, their biggest gain since Nov 11. The results ignited software stocks in a broader market down 0.6 percent after the company's quarterly earnings fell for the first time, but still topped market forecasts.

Quarterly profit at Infosys, which develops applications, designs supply chains and offers backoffice services, fell 3.6 percent to 15.8 billion rupees under Indian accounting standards, from 16.41 billion rupees a year ago.

Valued at 32 billion dollars, Infosys shares more than doubled in 2009 while the broader market jumped 81 percent. (ANI)