Ramalinga Raju
Out of the 5% reduction, 3% is because of cross currency and 2% is because of business.
George Price Stifel Nicolaus
Okay and one thing that was kind of surprising in the results. US was actually, it appeared to me to be the strongest in terms growth. Rest of the world, outside the US and the Europe it seemed to be the weakest. It is kind of counter intuitive. Can you kind of go through maybe what is going on there?
Ram Mynampati
Yeah George this is Ram Mynampati here. In fact the answer was in the explanation, that Srinivas gave for the Forex fluctuation or while we have significant growth in the Asia Pacific market particularly markets like Australia because of the cross currency fluctuation but growth did not find its way to the percentage contribution with the revenue. That is the reason why it looks somewhat odd. Whereas if you take volume growth into consideration that would be more reflective of the distribution of vote across geographies. So in that sense the numbers are not reflective of the true business distribution.
George Price Stifel Nicolaus
Okay and I guess just looking forward you mentioned consolidation in financial services. I guess what are you seeing over the next couple of quarters? That is then in terms of how much risk is there to growth from that, say for example with Merrill Lynch versus opportunity for Satyam. I guess stated in other way has Merrill started, has any of that work started to transition away? Do you have any indication that that is going to begin over the next couple of quarters?
Ramalinga Raju
Well without naming, without taking specific client by name I would just make some broad observations. There are some organizations that got impacted due to the market dynamics in the last couple of months and that, all our customers they continue to be our customers in almost all cases. The work that we have been executing for these customers we continue to execute that work even though now the customers name has changed perhaps or the organization has changed. So there is no significant reduction in the business that we are doing with any of these organizations, that is number one point. Second, while we remain a key player in most of these business areas that we are servicing for these customers, we have not received any indications of us not remaining a strategic player in these relationships. So I would not necessarily conclude that we would have to engage in an effort of transitioning our workout to anybody else. We believe that we have as good a chance if not better compared to other organizations to enhance our footprint in the integrated organizations. Our efforts clearly are in that direction and we are quite hopeful that we would remain a strategic player in every one of these relationships.
George Price Stifel Nicolaus
Last thing the consulting and enterprise business solutions seems to have some deceleration maybe more so than some of the other segments. If you can maybe walk us through that what you are seeing on the
in terms of demand there you know particularly around ERP
Ram Mynampati
Yeah this is Ram again. The consulting and enterprise business solution has grown at the rate at which the company has grown. By and large it remains at the same levels. It is a flat growth this quarter. Some of the reasons are because of the same currency related things that I mentioned because some of the business came from other markets they are not particularly the US market. So relating to the outlook we are aware of some of the announcements made by product vendors relating to reduction in licensing and somewhat of a negative environment. In spite of that at least our thinking is in the next couple of quarters we would not see any dramatic negative impact in our business for the enterprise solution segment. Beyond that now we obviously need to remain very close to the ground to see where the impact would be if any in FY2010, but at this point our outlook on enterprise business solutions has not changed dramatically in relation to the outlook for the rest of the business.
George Price Stifel Nicolaus
Thank you very much.
Ram Mynampati
Thank you.
Operator
Thank you, Mr. Price. The next question is from the line of Mr. Bhavan Suri from William Blair. Please go ahead. |
