Anand Deshpande, Founder, CMD, Persistent Systems in an interview with CNBC-TV18 said that the company is not seeing any slowdown in terms of any of customers reducing specific budgets. It says that the revenue targets are on track and aims to maintain profit before tax margins this year.
Below is the verbatim transcript of his interview with Sonia Shenoy and Reema Tendulkar of CNBC-TV18. Also watch the accompanying video. Q: Ninety percent of your revenues comes from North America and we have seen a certain amount of slowdown with respect to global growth specifically in the US markets. Any indication of a client budget cut downs and any indications on whether it would affect your own growth targets? A: We are not seeing the slowdown in terms of any of our customers reducing specific budgets as such. Most of our customers are software product companies and they sell in the technology market space. So,there are some definite changes happening in the technology market that are continuing to be fairly strong. We are seeing continued growth in our existing customers accounts. So, I am not seeing any slowdown at all. Q: Could you give us the outlook with respect to your margins because last quarter it got hit very hard. For this year what is it looking like? A: Yes, so the margins this year are going to be under pressure predominantly because of two reasons. One of them being the fact that we had a tax holiday as part of an STP company that has ended as of March 31, so our tax rate has gone up to 32%. We do expect to maintain profit before tax margins, in this years numbers. Also Read: See FY12 topline at USD 220 million says Persistent Systems There are several changes happening in the market, right now. Small companies are going to see lot of growth and we are investing in a few areas. So, we will continue to take a little bit of a hit on the margin. Salaries also will go up this year considering the demand in both technology markets and IT right now. Q: What would your EPS look like then with the increase in the tax rate? A: Last year we did Rs 140 crore profit. We expect to retain that profit margin, profit numbers to be in access of Rs 140 crore. We have given a guidance of USD 220 million for our topline, as against USD 170 million that we did last year. Q: ThatDiscover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
