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HTMT results for second quarter & half year ended 30th September 2004

First Half' 04-05 : Total income up by 20% to Rs.90.95 Crores, PAT at Rs. 40.02 Crores
2nd Quarter' 04-05 : Total Income up 11% to Rs. 45.61 Crores, PAT at Rs. 21 Crores

Mumbai, 30th October 2004

Hinduja TMT has posted a total income of Rs. 45.61 crores for the second quarter ended 30th September 2004, up 11% from Rs. 41.07 crores a year ago. Reduction in income from an outsourced call centre for a telecom client and lower other income restricted the Company's revenue growth for the quarter. This, coupled with higher staff expenditure on account of ramp ups in the Company's BPO business resulted in the Profit after tax growing by a modest 4%, to Rs. 21.04 Crores for the second quarter ended 30th September 2004 from Rs. 20.30 crores for the corresponding quarter in the previous year. Sequentially, the net profit of the Company has risen by 11% during the current quarter.

For the half year ended 30th September 2004, the Company's total income rose by 20% to Rs. 90.95 Crores, while the net profit for the period increased by 7% to Rs. 40.02 Crores.

Operational Performance

High quality execution has led to a strong ramp up in your Company's existing BPO businesses out of its Bangalore Offshore Delivery Centres. Out of a total of 2156 employees at Bangalore as on date, 1417 employees are engaged in BPO activities, 539 in Call Centre services, 150 in Software Development and 50 in support services.

In the first six months of the current financial year, the number of BPO employees has increased by 553 or 64% thereby increasing the ratio of employees engaged in BPO activities to the total employees from 28% as on March 2003 to 66% at present. Going forward, this trend would continue as the Company expects to have more BPO services delivered from India.

Global Operations

The recently acquired operations in Philippines (Customer Contact Centre Inc. & Source One Communication Asia Inc.) and US/Canada (Source One Communication Inc.) will continue to focus on call centre services.

With these acquisitions, HTMT has not only addressed the risk of high client concentration in its ITES (BPO/Call Centre) business as it has added about 22 new customers, it has also added different verticals like Pharmaceutical Products, Consumer Electronics, Household Products, Financial Services, Energy and Utilities to its market segments. Together with the Indian operations, HTMT's consolidated global employee strength has now crossed 3600.

Commenting on the acquisitions, Mr. K. Thiagarajan, Managing Director & CEO said "We are in the process of co-ordinating the efforts of HTMT with c3, SOCA & SOC and leveraging offshore/offsite infrastructure, integrating the manpower, realigning the management systems & quality processes, cross selling the locations & services and setting up an aggressive marketing network worldwide to further expand our revenue & customer base. The new business model adopted by HTMT is more enduring in the long term and it will adequately leverage country strengths, expand its global footprint, grow client relationships and enhance its competitive advantage."