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Infosys Technologies Announces Results for the Quarter Ended June 30, 2008
Q1 Revenues Grew by 28.7% year on year; Sequential Growth 7%

Bangalore, Karnataka, India, Friday, July 11, 2008 – Consolidated results for the quarter ended June 30, 2008

– Income was Rs. 4,854 crore for the quarter ended June 30, 2008; YoY growth was 28.7%

– Net profit after tax* was Rs. 1,302 crore for the quarter ended June 30, 2008; YoY growth was 20.7%

– Earnings per share* increased to Rs. 22.75 from Rs. 18.89 in the corresponding quarter in the previous year; YoY growth was 20.4%

* The net profit for the quarters ended June 30, 2008 and June 30,2007 includes a reversal of tax provisions amounting to Rs. 31 crore and Rs. 51 crore respectively. Excluding this reversal, the earnings per share for the quarters ended June 30, 2008 and June 30, 2007 would have been Rs. 22.20 and Rs. 18.00 respectively, resulting in a YoY growth of 23.3%.

Others

– 49 new clients were added during the quarter by Infosys and its subsidiaries

– Gross addition of 7,182 employees (net 3,192) for the quarter by Infosys and its subsidiaries

– 94,379 employees as on June 30, 2008 for Infosys and its subsidiaries

“Although the global economic environment continues to remain uncertain and could impact IT spending in the short term, we see several opportunities for growth as customers relentlessly focus on improving efficiency,” said S. Gopalakrishnan, CEO and Managing Director.

Business outlook

The company’s outlook (consolidated) for the quarter ending September 30, 2008 and for the fiscal year ending March 31, 2009, under Indian GAAP and US GAAP, is as follows:

Outlook under Indian GAAP – consolidated

Quarter ending September 30, 2008**

–Income is expected to be in the range of Rs. 5,229 crore and Rs. 5,272 crore; YoY growth of 27.4% – 28.4%

– Earnings per share is expected to be in the range of Rs. 23.52 and Rs. 23.95; YoY growth of 22.1% -24.4%

Fiscal year ending March 31, 2009**

– Income is expected to be in the range of Rs. 21,278 crore and Rs. 21,622 crore; YoY growth of 27.5% – 29.5%

– Earnings per share*** are expected to be between Rs. 99.34 and Rs. 101.06; YoY growth of 21.9% – 24.0%

** Conversion 1 US$ = Rs. 43.04

*** Including tax reversal of Rs. 31 crore in fiscal 2009 and Rs. 121 crore in fiscal 2008 respectively. Excluding the tax reversal the earnings per share are expected to be between Rs. 98.79 and Rs. 100.51 for the year ending March 31, 2009; YoY growth of 24.4% – 26.6%

Outlook under US GAAP

Quarter ending September 30, 2008

– Consolidated revenues are expected to be in the range of $ 1,215 million and $ 1,225 million; YoY growth of 18.9% – 19.9%

– Consolidated earnings per American Depositary Share are expected to be in the range of $ 0.55 and $ 0.56; YoY growth of 14.6% – 16.7%

Fiscal year ending March 31, 2009

– Consolidated revenues are expected to be in the range of $ 4.97 billion and $ 5.05 billion; YoY growth of 19.0% – 21.0%

– Consolidated earnings per American Depositary Share**** are expected to be between $ 2.32 and $ 2.36; YoY growth of 14.3% – 16.3%

**** Including tax reversal of $ 7 million in fiscal 2009 and $ 30 million in fiscal 2008 respectively. Excluding the tax reversal, the earnings per share are expected to be between $ 2.31 and $ 2.35 for the year ending March 31, 2009; YoY growth of 16.7% – 18.7%

Awards and recognitions

During the quarter, clients and market influencers recognized Infosys’ leadership in the industry as well as its service excellence and delivery efficiency.

Forbes magazine named Infosys in its list of Global High Performers. Waters magazine rated Infosys as the Best Outsourcing Partner. The Banker magazine conferred two Banker Technology Awards on Infosys to acclaim its work in wholesale and capital markets in two categories – Payments and Treasury Services, and Offshoring and Outsourcing. The International Association of Outsourcing Professionals (IAOP) ranked Infosys at No. 3 in its ‘2008 Global Outsourcing 100′. In addition, an aviation major recognized Infosys as its Supplier of the Year. Infosys became the first supplier to a power equipment and transportation major to be awarded a Certificate of Recognition.

Expansion of services and significant projects

Businesses across the world continued to benefit from Infosys’ services and solutions. A special competency group devoted to developing specialized products has been set up to enhance the business value provided to Infosys’ customers and support them on their transformational journey.

An automotive OEM is using Infosys’ engineering services to develop seating systems. A high-tech company has approached Infosys to develop its competitive strategy and transformation roadmap. An auto financier has engaged Infosys to develop its online dealer marketplace. A global auto manufacturer in India has signed up Infosys to develop a transport management system. Infosys is executing a Business Intelligence solution for a high-tech leader. A software major has sought Infosys’ expertise to design a campaign management platform. A high-tech manufacturer in South East Asia has turned to Infosys to implement a Siebel marketing campaign and analytics platform. Another high-tech company has sought Infosys’ help to improve its customer experience by constructing a customer portal and putting in place a governance structure to strengthen customer operations.

“The pricing environment continued to remain stable during the quarter,” said S.D. Shibulal, Chief Operating Officer. “Our end-to-end services combined with our consulting capabilities position us as a transformational partner for our large clients.”

An insurance major has partnered with Infosys to test interactive voice response (IVR) and speech applications.

Infosys is assisting a global bank to assess its enterprise architecture and rationalize its application portfolio. A financial product technology provider has sought Infosys’ expertise in developing an analytic tool.

Infosys continued to make inroads in emerging economies. A leading bank in the Middle East has engaged Infosys to implement CRM across its retail banking business. A media company in Australia has sought Infosys’ expertise to define its solutions. As part of the engagement, Infosys modified its delivery structure to mitigate risks in delivery and schedule.

Demand for Infosys’ consulting services continued to be strong with market leaders. A high-tech manufacturer has approached Infosys to create an Oracle-enabled business solution supporting rapid time-to-market, strategic expansion and a new business model. An agribusiness has selected Infosys to deliver a global program that includes redesign of the operations of its seeds business.

“We saw strong growth in the manufacturing sector during the quarter,” said B.G. Srinivas, Member – Executive Council, Senior Vice President and Global Head – Manufacturing Unit. “We are excited about new opportunities where large customers are partnering with Infosys on their innovation and R&D journey.”

Finacle®

Finacle®, the Universal Banking Solution from Infosys, won a strategic global partnership with BBVA, one of the top 15 banks. One of the largest banks in Asia Pacific is implementing Finacle®’s core banking solution.

Infosys BPO

Infosys BPO won recognition from customers and industry bodies for its service excellence. It was recently awarded COPC-2000® CSP Standard Version 4.1 certification for selected client programs. It was also declared the ‘Provider of the Year’ in the Large Enterprises category by FAO Today magazine for the second consecutive year. Infosys BPO has signed up two clients – a top global retailer and a European share registrar.

Process innovation

During the quarter, Infosys applied for an aggregate of 30 patents in the US and India. With this, Infosys has filed an aggregate of 149 patent applications (pending) in both countries and has been granted two patents by the U.S. Patent and Trademark Office (USPTO).

Research

An Infosys-supported research center has been set up at the University of Southern California (USC) Viterbi School of Engineering to facilitate joint research and education in software architecture, SOA and information integration, intelligent systems and agents, mobile and wireless systems, sensor networks and CAD frameworks and tools for hardware and software. Infosys has recently signed an agreement to undertake joint research with the International Institute of Information Technology, Hyderabad (IIIT-HU) to improve the functionality provided in Health Information Management Infrastructure (HIMI) solutions.

Liquidity and capital expenditure

Cash and cash equivalents, including investments in liquid mutual funds, as on June 30, 2008 was Rs. 7,564 crore (Rs. 6,442 crore as on June 30, 2007). During the quarter, Infosys incurred capital expenditure of Rs. 337 crore (Rs. 336 crore for the quarter ended June 30, 2007). Operating cash flows during the quarter ended June 30, 2008 were Rs. 1,249 crore (Rs. 932 crore for the quarter ended June 30, 2007).

“Margins for the quarter were impacted due to increases in salary and visa costs which to some extent were offset by rupee depreciation,” said V. Balakrishnan, Chief Financial Officer. “We believe that the currency market will remain volatile in the short term.”

Human resources

“Hiring has been as planned and attrition is under control,” said T. V. Mohandas Pai, Member of the Board and Head – HRD and Education & Research. “We see a clear trend of people seeking opportunities with companies like Infosys which can offer them long-term sustainable careers. This has considerably enhanced the pool of talent for high-growth sections of the business.”