India's i-flex Q3 net falls but sees no slowdown

BANGALORE Jan 22 (Reuters) - Indian banking software maker i-flex solutions IFLX.BO said on Tuesday its quarterly profit fell 3.6 percent because of a stronger rupee and other expenses, but it saw no slowdown from the global financial turmoil. The firm, majority owned by U.S. business software firm Oracle Corp (ORCL.O), sees strong business momentum as new international banking standards boost investments on technology, Chief Financial Officer Makarand Padalkar said.

"We need to be cautiously optimistic. Clearly, the situation is not something that people have kind of figured out. They are still saying that people are finalising their budgets," he told Reuters.

"We have not seen any clear impact of people cancelling projects or anything like that sort.. .so far we have not seen any impact, but at the same time I wouldn't say that we have seen the full picture unraveling." The company, which specialises in software for banks and financial firms, said consolidated net profit fell to 1.07 billion rupees ($27 million) in the fiscal third quarter ended Dec. 31 from 1.11 billion reported a year ago under the Indian accounting rules.

Padalkar said the earnings were hurt because of a stronger rupee INR=IN, which climbed 1.1 percent against the dollar in the December quarter and 12 percent in 2007, and a rise in other expenses.

Revenue grew 11.3 percent to 6.20 billion rupees.

The company, which counts Citigroup (C.N) and HSBC (HSBA.L) among its key clients, added 14 new customers in the December quarter.

At 0800 GMT, shares in i-flex, which gets more than half its revenue from banking software product Flexcube, was down nearly 14 percent at 966.05 rupees amid a broad sell-off in the main Mumbai market .BSESN that was down 7.2 percent. ($1=39.7 rupees) (Reporting by Sumeet Chatterjee; Editing by Ranjit Gangadharan)