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Stronger rupee dents Satyam’s net profit

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CURRENCY FEVER: B. Ramalinga Raju, Chairman, Satyam Computers, addressing a press conference in Hyderabad on Friday.
CURRENCY FEVER: B. Ramalinga Raju, Chairman, Satyam Computers, addressing a press conference in Hyderabad on Friday.

Special Correspondent

Company on course to touch $2 b-revenue mark

Engineering services register 14 p.c. growth

To add 16,000 associates this fiscal

HYDERABAD: Satyam Computer Services lost Rs. 138 crore, accounting for 3.9 per cent of net profit after tax in the first quarter of the current fiscal because the rupee grew stronger against the U.S. dollar by seven per cent.

Releasing the quarterly results here on Friday, B. Ramalinga Raju, Chairman, said the company, however, posted a robust growth in revenues and that it was well on course to touch the $2 billion-mark in revenues by the end of the year.

The company clocked revenues of Rs. 1,830 crore during the quarter under review, representing a year-on-year increase of 26.8 per cent and sequential increase of 2.9 per cent, with a volume growth of 9.5 per cent. The net profit after tax of Rs. 378 crore marked a year-on-year increase of 6.8 per cent but a sequential decrease of 3.9 per cent.

Chief Financial Officer, Srinivas Vadlamani, attributed the fall in net profit to the stronger rupee and the loss of basis points due to factors such as operating margins coming down.

Outlook

For fiscal 2008, the revenue growth under Indian GAAP (Generally Accepted Accounting Principles) consolidated is expected to be between 21.1 per cane and 22.5 per cent. EPS for the full year is expected to be between Rs. 24.14 and Rs. 24.46, implying a growth rate of 12.5-14 per cent. President, Healthcare, Ram Mynampati, said attrition rates fell from 15.7 per cent in the fourth quarter last fiscal to 14.9 per cent now. They were looking to add anywhere between 15,000 and 16,000 associates by the end of the current fiscal with 50 per cent of them being entry-level programmers.

Mr. Ramalinga Raju said the first quarter of this fiscal marked 20 years since Satyam was incorporated. “Eighteen months ago, we crossed the $1 billion mark and by the end of this year, we will have crossed $2 billion”. Satyam’s engineering services and infrastructure management services had grown by 14 per cent and 36 per cent, respectively, he added.

Services

The company is working to provide high-end design, computer-aided engineering (CAE), analysis, produce lifecycle management and other services for the world’s leading businesses, special-mission, and trainer aircraft manufacturer.

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