Speaking to The Financial Express days before the company declares its third quarter results on January 9, analysts said two areas related to Infy's dotcom exposure - that of receivables from dotcom clients and of a fall in the value of investments in dotcoms - continue to be worrying factors.

Around 9.5 per cent of Infy's total revenue of Rs 446 crore was accounted for by start ups in the second quarter ending September 2000.

However, compared to the corresponding quarter in 1999-2000, the growth is expected to be in the region of over 100 per cent. "But this is not a seasonal business and hence, tailing quarters are more relevant to track performance," analysts explained. The provisioning for receivables and loss on investments in the dotcom sector will hold the key to the final figures, analysts feel.

For the second quarter ending September 2000, the net profit stood at Rs 154 crore. In the first quarter of 2000-01, the company clocked a net profit of Rs 121.3 crore.

But some analysts are sceptical about this growth as Infy has around 20 dotcom clients who account for 9.5 per cent of revenues. "The company may require to write-off some receivables from this segment and as per our estimates it might be around Rs 19 crore," said an analyst with a foreign brokerage firm. In addition, the company has also invested around Rs 44 crore (at cost) in loss making dotcom and hitech companies, the market prices of which have fallen substantially.

"Infosys may require to provide for loss of investment value to the tune of around Rs 20 crore which might be factored in the third quarter results," he said. However, some sections also put the net figure higher. "Net profit for the third quarter is expected around Rs 174 crore, which is over 130 per cent growth over the previous quarter of last year," said Refco-Sify (a brokerage firm) head of research Nikunj Doshi.

He said this growth will be due to increased employee efficiency during the quarter. Infy's share price had fallen from Rs 7,500 in the beginning of December 2000 to a 52-week low of Rs 5,416 in the last week of December due to fears of a slowdown in the US economy which might affect the company's business. However, following the upsurge in the Infosys American Depository Receipt at Nasdaq, the stock in the domestic market has also moved up and closed at 6,381.50 on Friday at the Bombay Stock Exchange (BSE), a rise of around 18 per cent from the yearly low levels.