Conference Call      
                 CMC
The tax rate is expected to be 27.5%-28% in Q4FY12 and 24%-25% in FY13


CMC held a conference call after it announced its third quarter results for FY12. Mr. R. Ramanan, MD & CEO and Mr. J K Gupta, CFO addressed the call.

61.5% of revenues were from International business of which 51.1% were from North Americas which grew 4% q-o-q in $ terms.

The company's average effective tax rate declined to 29.2% in Q3FY12 and is expected to decline to 27.5% to 28% by Q4FY12 and 24% to 25% by FY13.

The Company added 21 new clients (7 in International, 14 from India) during Q3 FY12. Out of 14 client addition in India, 7 were from Government vertical. Out of 7 international client additions, 4 were from Americas, 2 from Europe and 1 from MEA.

The Cash and Cash equivalent stood at Rs 226 crore.

The capital expenditure for the quarter stood at Rs 27 crore and Rs 82 crore for nine months ended December 2011 and is expected to be Rs 135 crore to Rs 140 crore during FY12, resulting in a capex of Rs 53 crore to Rs 58 crore for Q4FY12. Capex for FY13, which was earlier expected at Rs 100 crore, may increase to Rs 200 to Rs 250 crore.

The management is targeting an EBITDA margin of 15%-18%.

There was forex loss of Rs 28 lakh against Rs 3.66 crore q-o-q.

        Conference Call      
          CMC
The tax rate is expected to be 26.5% in FY13


CMC held a conference call after it announced its fourth quarter results for FY12. Mr. R. Ramanan, MD & CEO and Mr. J K Gupta, CFO addressed the call.

61.8% of revenues were from International business during the quarter which grew 4% q-o-q and 61% y-o-y of which 54% were from North Americas which grew 6% q-o-q and 48% y-o-y in $ terms contributing 52% of revenues.

During FY12, Services grew 34% contributing 90.5% of revenues. International grew 48% contributing 60% of revenues. Americas grew 48% in dollar terms contributing 50% of revenues.

The Company is in the process of enhancing its capacities at SEZs at Hyderabad and Kolkata, to cater to the growth in international business.

14 clients added during the quarter with 1 in Americas and 13 in India across e-governance, Retail, Defence and Infra space and cumulative addition of 74 clients during 2011-12.

Employee productivity improved by 1%.
CAPEX of Rs 27 crore was incurred in Q4 and it is expected to be Rs 228 crore in FY13.

The management declined to give hiring guidance and would hire according to business demand.

DSO improved from 96 days to 95 days.

Tax provision included Rs 1 crore of prior period item.
Offshore contribution to revenues declined from 27.8% to 26% and is expected to be at current levels for the next two quarters but there is expected to be some shift to offshore from Q2FY13 onwards.

There is not much impact of current macro-economic concerns on CMC as it is more into hi-tech, manufacturing and government verticals.

Total employees include 4603 regular and 5172 on contract basis.

SI and embedded systems are expected to be the growth drivers.

TCS contributed 53% of revenues during Q4.

Cash and Cash equivalent stood at Rs 210 crore.

The company's average effective tax rate is expected to be 26.5% by FY13.

The management continues to target EBITDA margin of 15%-17%.

There was forex loss of Rs 60 lakh in Q4 and Rs 28 lakh in Q3 and Rs 4.5 crore in FY12 and Rs 56 lakh in FY11.

The company is not looking at inorganic growth currently.

RD used to recommend it a lot saying that it never ever diluted its equity !