Net income rose to 2.06 billion rupees, or $47 million, in the three months ended March 31 from 1.34 billion rupees a year earlier, according to Indian accounting rules, the Hyderabad-based company said in a statement. Sales increased 39 percent to 10.1 billion rupees.
Satyam and larger rivals such as Infosys Technologies and Wipro are increasing profit as companies like General Electric send work to India, where software writers are paid one-sixth of the equivalent U.S. wage.
"They have concentrated on a few businesses and are trying to cut down costs," said Gurunath Mudlapur, head of research at Khandwala Securities. "They are trying to grow the few clients to larger accounts and manage them to enhance their operating margins."
He is maintaining a "buy" rating on the stock.
Satyam forecast sales would rise by between 26 percent and 28 percent in the year ending March 31, 2006, and earnings per share would increase by 20 percent.
It said fourth quarter sales rose from 7.28 billion rupees a year earlier, while it added 28 clients in the period. The company, which employed 19,164 workers at the end of March, hired 1,499 employees in the quarter.
Larger rival Tata Consultancy added 1,775 employees in the quarter for a total of 45,714 workers, while Infosys added 1,521 employees to bring its work force to 36,750.
Satyam said it will pay a final dividend of 3 rupees a share.
