Infotech Q3 profit up 82% at Rs 62 cr

Infotech Enterprises Ltd today posted 82% jump in net profit to Rs 61.83 crore for the quarter ended December 31, 2012.

This is against a net profit of Rs 33.96 crore in the same period last year, Infotech said in a statement.

Sequentially, net profit was up 22.9% from Rs 50.3 crore in the July-September quarter.

The company's Q3 total income from operations stood at Rs 475.12 crore in the reported quarter, up 14.1% from Rs 416.52 crore in the year-ago period, it added.

On sequential basis, total income was down marginally from Rs 477.13 crore in the July-September 2012 quarter.

"We had a stable Q3. In spite of challenges in Europe and Hi-Tech vertical, we maintained small revenue growth and robust margins," Infotech Enterprises Chairman and Managing Director B V R Mohan Reddy said.

The company announced an interim dividend of 40% or Rs 2 per share, the statement said.

During the quarter, Infotech added 11 customers, two in UT&C (Utilities, Telecom and Content) vertical and nine in Engineering space.

"Q3 of FY 2013 saw significant challenges in two of our Top 10 accounts, resulting in a quarter-on-quarter revenue drop of 4.2% (in engineering vertical). While the revenue dip in the heavy equipment customer is a one time issue, the ramp-down in the semiconductor will take at least two quarters to backfill," the company said.

The drop in revenue lowered the operating margin and the company expects to scale back to earlier levels in Q4 on accounts on increased revenue momentum and better utilisation, it added.

"We believe some of these challenges are market driven and also internal to the organisations. Markets are certainly showing signs of recovery and actions are being taken to strengthen the internal organisation.

"We hope to get back to a stronger growth path on revenues in the next one to two quarters and the long term business prospects remain strong," Reddy said.

Utilities and Telecom segment witnessed revenue growth of 6.6%, quarter-on-quarter.