Indian Software Majors Third Quarter Review

The

Indian software services sector is now in top gear aided by a strong demand

growth as well as some smart thinking by the majors who have focused on large

orders. Going forward, it can be expected that for the quarter ending 31st March

2006, the performance would be similar if not better that the third quarter

results for most of the players.

How long this trend is

likely to continue is of course a million dollar question but given the

continued recruitment drive in the sector as well as new multi-year and

multi-million dollar contracts being signed, this boom seems to be one that can

be sustained at least for the next six months unless there is some adverse

political or economic developments.

As can be seen from the table below all companies have

shown over 30% revenue growth compared to the same quarter in the previous

fiscal, even on a quarterly basis the growth is significant. Margins and profits

after tax in the third quarter have been better for all except Patni.

Tata Consultancy Services TCS, India's largest software company reported strong revenue and net profit figures for the quarter ended December 2005, The company reported total revenues of Rs 3,288 crore for the quarter ended 31st December against Rs 2,553 crore for the corresponding quarter last fiscal up 29.8% y-o-y. On sequential basis revenue grew by 11.1% to Rs 2,960 crores.		Satyam Satyam's results for the third quarter ended December 2005 saw a major growth in revenues to Rs 1,265 crore up from Rs 907 crore achieved in the same quarter previous year  up by 39%. On a quarter to quarter basis the growth was 10%. The net profit of the company for the same period amounted to Rs 269 crores (excluding Rs 159.8 crores gain on sale of investments) as compared to Rs 237 crores in the immediately preceding quarter up by 14% and a  whopping 64% over the same quarter last year
Infosys Technologies Infosys, India's second largest software company reported an impressive set of figures for the quarter ended December 2005, the company registered a healthy growth in terms of revenues, which were up 10.4% sequentially amounting to Rs 2,532 crores as compared to Rs 2,294 crores and up 35% as compared to Rs 1,876 crores in the same quarter of the previous fiscal year. Net profit was Rs 649 crores, up 7% as compared to Rs 606 crore in the immediate previous quarter and y-o-y the net profit grew 30.6% as compared to Rs 497 crore.		HCL Technologies HCL reported excellent results for its second quarter ending December 2005, where in consolidated revenues grew 9% sequentially amounting to Rs 1054 crores as compared to Rs 971 crores. The revenues y-o-y were up by 32% amounting to Rs 801.4 crores in the same quarter last year. Net profit for the same period was Rs 181 crores, up by 8% sequentially
Wipro Wipro saw its third quarter revenues reach Rs 2,774 crores, witnessing a healthy 9.9% sequential and 30% y-o-y revenue growth as compared to Rs 2,110.1 crores. The net profit of the company grew by 14% on a sequential basis amounting to Rs 543 crores, whereas the net profit as compared to the same quarter in the last year witnessed a 27% increase		Patni Computer Systems Patni Systems' revenues for the fourth quarter grew 4.8% sequentially amounting to Rs 556.9 crores as compared to Rs 519.7 crores. Y-o-y the revenues for the quarter were up 33.6% amounting to Rs 401.2 crores in the same quarter last year. Net Profit for the same period was Rs 66.1 crores, up by 7% sequentially but down 3% y-o-y as compared to Rs 71.3 crores and Rs 68 crores respectively