Stories by John Ribeiro

India's Tata posts revenue growth, but profit down

India's largest outsourcer, Tata Consultancy Services (TCS), reported Monday that its revenue grew by 6.8 percent to US$6 billion for its fiscal year ended March 31. The company's profit however fell by 10.1 percent to $1.12 billion.<br/><br/>The growth in revenue was 23 percent higher in terms of Indian rupees because of the depreciation of the rupee against the U.S. dollar.<br/><br/>The results are based on U.S. generally accepted accounting principles.<br/><br/>TCS and other Indian outsourcers are facing a slow-down in business from their U.S. and European clients. Discretionary projects are not taking off, and some clients are renegotiating contract prices as they go through difficult fiscal times, said N. Chandrasekaran, TCS' chief operating officer, during a press conference that was also webcast.<br/><br/>The company's CFO (chief financial officer) S. Mahalingam said that a single-digit decline in prices was expected in the current fiscal year.<br/><br/>India's second largest outsourcer, Infosys Technologies, said last week that its revenue in the fiscal year ending March 31, 2010, may decline by 3.1 to 6.7 percent over the previous year. <br/><br/>For the fiscal year ended March 31 this year, Infosys posted revenue of $4.7 billion, up by 11.7 percent over revenue in the previous year. Profits were $1.3 billion, up 10 percent over the previous year.<br/><br/>TCS increased operating profits in the last fiscal year by 11.7 percent to $1.43 billion by improving operational efficiency, including an increase in work delivered offshore from India. <br/><br/>Doing work offshore helped the company increase staff utilization and better manage costs, Mahalingam said. <br/><br/>The company had 143,761 staff at the end of the fiscal year. It added 32,354 employees during the year, including staff from the company's acquisition of Citigroup's back office services subsidiary in India.<br/><br/>TCS has made 24,885 campus offers for the current fiscal year. It added 163 customers during the year, of which 36 were in the fourth quarter.

Infosys adding staff despite expecting falling revenue

Popular wisdom would have it that a services company should not add more staff if it expects revenue to dip. <br/><br/>But India's second largest outsourcer, Infosys Technologies, will add 18,000 staff in the year to March 31, 2010, even as it expects revenue during the year to decline by between 3.1 to 6.7 percent.<br/><br/>About 16,000 of the new staff will be hired from campuses, as Infosys intends to honor offers it has already made to students from these campuses, said S. Gopalakrishnan, Infosys' managing director and CEO, in a conference call with analysts on Wednesday. <br/><br/>The new recruits will not be hired at one go, but will instead be hired in batches, a spokeswoman for Infosys said.<br/><br/>As the hires will be mainly campus recruits, they will undergo a fairly lengthy process of training, she said.<br/><br/>Infosys' strategy will ensure that the new staff are ready to be deployed on customer work when the market picks up, she added.<br/><br/>Infosys however said it will freeze salaries this year to contain costs, as the outsourcing market gets more difficult.<br/><br/>The forecasted decline in revenue this fiscal year will be Infosys' first decline in annual revenue since the company started operations in 1981. <br/><br/>Infosys hired 28,231 employees in its last fiscal year, which ended March 31. However, the net addition to the payroll for the year was 13,663, as the company has tightened on its requirements of staff performance. <br/><br/>Indian outsourcers usually hire staff in advance of requirement to train them, cope with attrition, weed out staff that do not meet performance requirements, and also to keep staff on the ready for any unpredicted surge in demand from customers. <br/><br/>Infosys had a total of 104,850 employees as of March 31. <br/><br/>The company, like other Indian outsourcers, is seeing a slow-down in business as customers postpone expenditure on new outsourcing contracts and are also demanding lower prices from their suppliers. <br/><br/>"I do not see as yet a dramatic improvement ahead in the market conditions," said Siddharth Pai, a partner at outsourcing consultancy firm Technology Partners International (TPI). <br/><br/>In an Infosys survey of top customers, the majority said that a recovery will be beyond March of next year, said S.D. Shibulal, Infosys' chief operating officer. <br/><br/>Infosys is currently facing a decline in business volumes, decline in prices, and currency volatility, Gopalakrishnan said.

Indian government appoints Satyam's chairman

The Indian government appointed Kiran Karnik as chairman of Indian outsourcer Satyam Computer Services on Friday, a day after the company's board appointed a CEO and special advisers to the company.

Satyam appoints management advisor, investment banks

The board of Satyam Computer Services has appointed The Boston Consulting Group as management advisor, and Goldman Sachs and Avendus, an Indian investment bank, as investment bankers to advise the company on various strategic options, including bringing in a large investor in the company.

Satyam board meets again, still no plan

The newly reconstituted board of financially troubled Indian outsourcer Satyam Computer Services met for the second time on Saturday, and the company's future remains unclear.