Infosys Technologies, India's No. 2 software services exporter, reported a 0.9 per cent drop in quarterly profit, slightly more than the market estimates, as a firmer rupee countered the impact of rising demand for outsourcing.
The company, which kicked off results for the country's $60 billion IT services sector, said January-March net profit fell to 16.00 billion rupees ($361 million) from 16.15 billion a year ago.
A Reuters poll had estimated a profit of 16.05 billion rupees for Infosys, which counts Goldman Sachs, BT Group and BP among its clients.
Infosys, sector leader Tata Consultancy Services and third-ranked Wipro have revived hiring, signaling improving demand for the outsourcing industry.
But the export-driven firms, which manage complex computer networks and maintain technology operations for many Fortune 500 companies, are facing pressure on profit margins from a stronger rupee, rising wages and competition from global players.
Infosys shares, valued at $35 billion, rose 0.4 per cent in Jan-March in line with the broader market and slightly lagging a one per cent rise in the sector index.