www.infystocks.co.uk

4 October 2007

Infosys Gets a Lift

By Daniel Del'Re
TheStreet.com Staff Reporter
9/27/2007 1:48 PM EDT
Click here for more stories by Daniel Del'Re


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SAN FRANCISCO -- Shares of India-based tech services bellwether Infosys (INFY - Cramer's Take - Stockpickr - Rating) rose Thursday on a report that it may raise profit targets.

An analyst with Macquarie Securities told Bloomberg that strong demand for outsourcing services would likely lead Infosys to lift its dollar-denominated guidance. The company is scheduled to report its second-quarter results on Oct. 11.

Shares were recently trading up $1, or more than 2%, to $48.30, off the morning's highs.

A spokesperson said the company couldn't respond to the analyst's comments because Infosys is in a "quiet period" leading up to the second-quarter financial report.

An upbeat forecast by Infosys would raise concerns that India's large IT outsourcing firms are suffering under the weight of a sharply appreciating rupee and wage inflation that are squeezing profit margins.

Infosys' first-quarter results underscored the effects these trends as the company handily beat analysts' revenue and profit expectations in dollar terms but appeared less profitable in rupee terms.

The rupee has risen about 9% this year, and broke through the 40-per-dollar level last week at which it had stabilized. At the same time, competition for network and software engineers in India has driven up wages by 12% to 15%.

Another concern dogging the Indian tech services firms is whether their revenue will suffer as problems in the credit and mortgage markets shake their clients in the financial services industry. Many of the big banks that outsource their IT functions have seen investors lose enthusiasm for the debt products they package for mortgage lenders and buyout shops.
we bought at 1800 15 days before we you remember your privileges post on your web we upgraded trag of infy 2400+ near December

by erectusplus at 18:17:00 |