Infosys plans $21 m investments this year

IT major Infosys Technologies plans to invest nearly $21 million (Rs 97 crore) into its various businesses with nearly $5 million going to its banking business unit. These investments would be made over the next nine months.

Having registered a robust growth in the first quarter ended June 30, 2004, the company has revised the outlook for the entire current fiscal to Rs 6,731-6,772 crore in consolidated revenues under the Indian GAAP. This is an increase of nearly Rs 730 crore in revenues.

Giving details about money for the new investments, Nandan Nilekani, president, CEO and managing director, Infosys Technologies, said, "Our increase in guidance for the year is a little over Rs 730 crore. Of this, Rs 300 crore is expected from forex benefits and we expect the business to have an increased revenues of Rs 430 crore. Both these are expected to contribute to about Rs 261 crore of increased profits. Out of that, the guidance from earnings side has gone up by Rs 197 crore. Which means that we have taken about Rs 97 crore ($21 million) from Rs 261 crore and putting it back into our company."

The investment of $21 million would be made over the next nine months. Of this, about $5 million will go towards the banking business unit. This means that that banking unit would double its investments from $5 million as announced earlier to $10 million. The remaining $16 million would go to various business units such as retail, insurance, healthcare, banking, European and Asia-Pacific units of Infosys.

"These units have given us a detailed business plan for the next three years on how they would grow their topline, create solutions, increase margins and provide value-added consulting. We are providing them with the financial strength in order to help them go ahead with their investment for the future. This is an incremental investment," Nilekani added.