Bangalore: Digital Globalsoft Ltd, the Indian subsidiary of global IT major Hewlett Packard (HP) on July 21 reported a net profit of Rs 30.2 crore during April to June 2003, an increase of 9.4 per cent over Rs 27.6 crore recorded in the first quarter in 2002.

Revenues increased by 38 per cent to touch Rs 140.2 crore in the first quarter as against Rs 101.62 crore during April to June 2002, a company statement said.

"The encouraging increase in revenues from HP demonstrates our parent's sustained commitment and confidence in Digital's capabilities and operating model," Digital chairman Peter Mercury said.

Digital's quarter-on-quarter revenue over the fourth quarter of 2002 shot up by 10 per cent and net profit shot up by 0.5 per cent.

Commenting on the outlook for 2003-4, Digital chief executive officer (CEO) Som Mittal said it was in the process of "re-establishing its growth momentum" and remained positive enabled by the creation of the company as the consolidated focal point for HP services global delivery initiatives from India.

Digital said the business outlook between 2004-05 and 2007-08 remains encouraging adding, "the company intends to achieve accelerated growth during this period as per the indications given earlier, based on revenue commitment of HP services.

Asserting that there was no billing pressure either from HP or other clients, Digital said the rates were maintained at existing levels rpt at existing levels.

Digital hired 747 people during the first quarter, with the recruitment driven by the increase in Digital contact centre employees, its business process outsourcing (BPO) operations, which has touched over 1,000 strong since its inception in 2002.

The company said it was doubling the size of existing facilities besides acquiring additional five acres of land near its campus in Bangalore for further expansion.

HP's business during the current quarter touched over Rs 100 crore and independent business increased to Rs 26.2 crore, while HP-referred external business declined to Rs 5.7 crore.

"Our services business continues to be the key growth driver, where we see positive client traction and stabilisation of billing rates. Our revenue performance demonstrates continued commitment from HP to increasingly engage with Digital as its primary global delivery operation from India," Mittal said.

He said Digital's earnings performance reflected the strength of "efficiency-led" business model with HP and its global trade partners are driven on market-led terms and our investments in future growth businesses.

PTI