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``The primary reason why work was outsourced to India was because the same quality or better quality could be done cheaper,'' said Sanjay Sinha, the chief investment officer at SBI Mutual Fund who oversees $6.5 billion including 1.13 million Infosys shares. ``That is precisely the reason why you would continue to outsource to India when you are faced with a scenario where your business needs to cut costs.''

The increased forecast lifted shares of Infosys, the worst performer on India's equity benchmark Sensitive Index last year. Infosys rose as much as 5 percent, the biggest gain on the Sensex, paring its decline for the year to 16 percent. The stock traded 4.9 percent, or 70.1 rupees higher, at 1,492 rupees at 10:28 a.m.

Increased Budgets

``We continue to see greater growth opportunities in Europe,'' Chief Operating Officer S.D. Shibulal said in the statement. The environment for billing rates remained stable in the three months ended March 31, he said.

Earnings will gain to 92.32 to 93.92 rupees per share in the year that started April 1 from 81.26 rupees, Infosys said. The software exporter was expected to forecast earnings of 93 rupees to 94 rupees, according to estimates from Vipin Khare, an analyst at Morgan Stanley, and Diviya Nagarajan of JM Financial SK Securities Pvt.

Sales may reach 198.9 billion rupees to 202.1 billion rupees in the 12 months, from 166.9 billion rupees, Infosys said. Revenue rose 20 percent in the year ended March 31.

American Express Co. and Goldman Sachs Group Inc. are among banks and financial services companies that are likely to increase contracts awarded to Infosys for work to be done ``offshore,'' or in low-cost locations such as India, over the 12 months to March 31, JM Financial's Nagarajan said on April 7.

Increased Budgets

``Clients such as Goldman Sachs and American Express have upped budgets this year, while others such as UBS have increased offshoring with Infosys even as IT budgets have been slashed,'' Nagaragan said. ``While absolute spending could come under pressure in the rest of the year, we believe that offshore momentum with Infosys would be sustained.''

JM Financial recommends clients buy Infosys shares.

Accenture, the world's second-largest technology-consulting firm, reported a 37 percent jump in profit and raised its earnings forecast after cost-cutting customers outsourced more of their work. The company posted record revenue from companies sending more work overseas for the three months ended Feb. 29.

In the fourth quarter, Infosys reported net income rose 9.2 percent to 12.5 billion rupees, or 21.78 rupees a share, from 11.4 billion rupees, or 19.95 rupees, a year earlier.

Profit in the three months ended March 31 was in line with the 12.6 billion rupee median estimate in a Bloomberg survey of 10 analysts. Sales climbed 20 percent to 45.4 billion rupees from 37.7 billion rupees.

To contact the reporters on this story: Harichandan Arakali in Bangalore at harakali@bloomberg.net.

News sourced : http://www.bloomberg.com

BY TIM HIGGINS and BRENT SNAVELY

Chrysler LLC and Nissan Motor Co. announced a blockbuster partnership Monday to assemble cars and pickups for each other in a deal that draws on each automaker's expertise and perhaps sets up the companies for a much deeper relationship down the road.

Nissan will build small cars for Chrysler to sell and Chrysler will make pickups for Nissan under a deal announced by both companies late Monday afternoon.

Analysts saw the moves as a potential big step toward adding Chrysler to the Renault-Nissan alliance, but the companies downplayed that scenario. Carlos Ghosn, the chief executive of both Renault and Nissan, has long said he wants a North American partner.

Two years ago, he came up short in a bid to merge with General Motors Corp.

"This is definitely deepening the relationship considerably, which I think is good for both parties," said Erich Merkle, director of forecasting for Grand Rapids-based consulting firm IRN Inc. "Chrysler needs a small car. In terms of the time and resources it would take to develop a legitimate small car offering, Chrysler doesn't have it."

Financial terms of the deal were not disclosed. Executives from both companies worked to downplay speculation that Monday's deal was anything more than a simple transaction to make cars and trucks for each other.

Dominique Thormann, senior vice president of administration and finance for Nissan North America Inc., said the companies plan to "keep an open mind and open dialogue for further product-sharing opportunities," emphasizing that he was referring not to financial or ownership-related deals, but only to product and production-related deals. Nissan refers to such arrangements as original equipment manufacturer or OEM deals.

"Once again, this is an OEM discussion and we don't have a business discussion ongoing currently," Thormann said. "There is no business discussion right now."

Tom LaSorda, a Chrysler president and vice chairman, echoed those words. "These are both just product deals," he said.

This is hardly a first date for Chrysler and Nissan.

In January, Nissan and Chrysler agreed to a deal in which Nissan will build a small car based on the Nissan Versa for Chrysler to sell under one of its brands in Brazil in 2009.

Nissan affiliate JATCO also has been supplying transmissions to Chrysler since 2004.

Under the new deal, Nissan will use its Oppama Plant in Japan to build a Chrysler-designed small car for the Auburn Hills automaker to sell in North America, Europe and elsewhere beginning in 2010.

Chrysler plans to use its Saltillo, Mexico, plant to assemble a Nissan-designed pickup for the Japanese automaker to sell in North America starting in 2011.

Both the pickup and the small car will be sold in the United States, said Frederique Le Greves, vice president of communications for Nissan North America Inc.

Neither company provided model names or volume targets.

The new Nissan pickup will be based on the Dodge Ram but tailored to the Japanese company's designs and the new Chrysler small car will be based on a Nissan platform with design out of Auburn Hills, LaSorda said. He added that the Chrysler small car will be based on a new platform but declined to name it.

"Nissan, their forte is small cars and they do them very well. They can do it quickly with very little investment," Merkle said. "Chrysler can help Nissan with one of its shortcomings, which is the Titan pickup."

To UAW members, the deal means Chrysler's U.S. pickup plants in Warren and near St. Louis could see more work as the automaker plans to shift production currently done at Saltillo to make room for the Nissan truck.

Jason Craig, who works at a Chrysler parts warehouse in Center Line, said the announcements were shocking and frustrating, especially because the new vehicles, to be sold in the United States, are to be built in Japan and Mexico.

"Don't try to pass it off as something that's American, if it's not," said Craig, 34, of New Baltimore.

Chrysler, with its truck-heavy lineup, has struggled in recent years as the price of gasoline has soared and consumers have turned to smaller cars.

Chrysler has been looking for partners ever since Cerberus Capital Management bought a controlling stake last August from DaimlerChrysler AG, leaving the newly private U.S. automaker without global reach. Chrysler lost $2.9 billion on operations and restructuring costs last year, internal numbers seem to indicate.

"Forging the right tactical partnerships is critical to the long-term success of Chrysler," LaSorda said.

Chrysler also has a deal with Chery Automobile Co. to sell Chinese-made small cars under a Chrysler brand name but those vehicles are not ready for North America.

"At some point we believe we need more than one small car for NAFTA," LaSorda said. "So, yes, we would be counting on Chery to help us with that."

Nissan's current pickup -- Titan -- is made in Canton, Miss. The current generation of the Titan -- Nissan sold 66,000 of them in the United States last year -- is expected to end in 2010.

The Canton plant also makes Nissan's Altima and Armada. Nissan announced last week its plans to make a line of three business trucks in Canton for sale beginning in 2010.

Along with helping each company fill its lineups, the deal also helps them improve their global scale, said David Cole, chairman of the Center for Automotive Research in Ann Arbor. He and other experts said it could lead to a bigger partnership in the future.

"With a second date ... it tells you two things are going on here: One, the people in New York are talking about the business side of things. And also the technical, engineering/manufacturing people are talking about working together. And those are two ingredients that have to occur for this to result in a more comprehensive marriage," Cole said.

Contact TIM HIGGINS at 313-222-8784 or thiggins@freepress.com. Business writer Jewel Gopwani contributed to this report.

News Sourced : http://www.freep.com

Infosys Expects Sales Growth to Accelerate, Joining Accenture

Nissan, Chrysler agree to share products Companies downplay talk of alliance, but analysts say it's possible