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Riding high on the outsourcing wave, Delhi based Hughes Software Systems Ltd (HSS) has reported 52 percent increase in its net profit for the quarter ended September 30, 2004. 

The company registered a net profit of Rs 25.8 crore for the second quarter ended September 30, 2004 as compared to the corresponding figure of Rs 17 crore for the same period last year. 

The company also registered total income of Rs 118 crore during the July-September quarter depicting an increase by 36 percent when compared to the corresponding figure for the same period last fiscal.

Talking about the future outlook for the company, HSS president and MD Arun Kumar said that the company would continue to hinge its focus towards the telecom arena. 

"Our future profits are going to come from our next-generation network business, the wireless networks space and the telecom service provider space. The telecom industry is getting more robust and we continue to see good demand for our products and services," he added.

Speaking about the results he said, that the company demonstrated predictability and that this was the tenth quarter in which the results were along predicted lines. And that the growth predicted for the next quarter would be purely organic. 

Talking about the company's plans to acquire companies in the BPO and TSP space, Kumar said that the company is not looking to have a minority stake at this point of time. "We have enough cash reserve with us. So taking a minority stake will not make sense. We are looking at a 100 per cent acquisition and at present we are open to both Indian as well as foreign companies," he added. He also noted that the company is not interested in very small companies, and that with their reserves of $40 million, they would seek to acquire mid- if not larger-companies.

Speaking of growth, he said that growth for them was driven by repeat customers as they had "more business from existing customers." Also, that the growth had come from volumes, as the prices had remained stable. 

Kumar emphasized that "timely hiring" was going to be a challenge for the company. With a current workforce of close to 3000 people, the company plans to add another 2,000 people for the coming next six quarters, of which 500 will be for the BPO. 

Speaking about the impact of H1B visa cap of 65,000, Kumar said that it may affect some offsite operations, but that they could always go for local hiring.

As the company expands its employee base, it is also planning to acquire more office space for its Bangalore as well as Gurgaon operations. "As part of our Indian investment plans, we would be acquiring new facilities in Bangalore as well as the Gurgaon," Kumar further informed.

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