Good day, ladies and gentlemen and welcome to the Third Quarter 2011 Genpact Limited Earnings Conference Call. My name is Erica and I will be your coordinator for today. At this time, all participants are in a listen-only mode. We will be facilitating a question-and-answer session towards the end of this conference. (Operator Instructions) I would now like to turn the presentation over to your host for today’s call, Mr. Shishir Verma, Head of Investor Relations. Please proceed.

Thank you, Erica. Welcome everyone welcome to Genpact’s earning call to discuss our results for the third quarter ended September 30, 2011. With me, I have Tiger Tyagarajan, our President and Chief Executive Officer; and Mohit Bhatia, our Chief Financial Officer. We hope you’ve had an opportunity to review our earnings release. If not, you will find it on our website at www.genpact.com. Our agenda for today is as follows. Tiger will begin with an overview of our results, and our perspective on the current environment followed by Mohit, who will discuss our financial performance in greater detail, and then Tiger will have some closing comments. Finally, Tiger and Mohit will be available to take your questions. We expect the call to last about an hour. Please note that some of the matters we discuss in today’s call are forward-looking. These forward-looking statements involve a number of risks, uncertainties and other factors that should cause actual results to differ materially from those in such forward-looking statements. Such risks and uncertainties include, but are not limited to, general economic conditions, and those factors set forth in our press release and discussed under the Risk Factors section of our Annual Report on Form 10-K and other SEC filings. Genpact assumes no obligation to update the information presented on this conference call. In our call today, we will refer to certain non-GAAP financial measures, which we believe provide additional information for investors and better reflect the way management views the operating performance of the business. You can find a reconciliation to those measures to GAAP, as well as related information in our news release on the Investor Relations section of our website, www.genpact.com. Please also refer to the Investor Fact Sheet on the front page of the IR section of our website for further details on our quarter results, which we hope you will find useful. This includes, among other things, geographic, industry vertical and BPM and IT revenue details. With that, let me turn the call over to Tiger.

Thanks, Shishir. Good morning, good afternoon, good evening everyone, and thank you for joining us on our call today. We delivered another great quarter in quarter three with strong growth in revenues, adjusted operating income and margin, earnings per share and cash flows. Growth was led by Global Client revenues from both business process management and IT. The integration of Headstrong is on schedule and we continue to gain traction in the marketplace where we have won 11 cross-sell deals including the five we discussed during our last earnings call. In total across all of our businesses in the third quarter we won 27 new logos including seven in our Headstrong Capital Markets vertical. We also expanded existing client relationships significantly this quarter, the number of client relationships representing between $5 million and $25 million in annual revenues increased from $37 million to $52 million in the third quarter with seven coming from Headstrong. And the number of plants representing $1 million to $5 million in revenues increased from $59 million to $112 million with 25 from Headstrong. This gives us a great runway for growth. These results reflect the resilience and diversity of our business model. We continue to drive growth across industry verticals, service offerings and geographies. This was despite ongoing macroeconomic concerns particularly in the European Union financial markets, softness in U.S. consumer facing financial services and Japan. In line with our strategic initiatives of moving our leadership closer to our clients two of our key vertical business leaders ahead of manufacturing and services and ahead of CPG, pharma, retail as well as our leader for new product innovation are in the process of relocating to the U.S. With these changes and my own plan shift to New York, we will have a more balanced distribution of…

Thank you, Tiger, and good morning, everyone. Today, I will speak about our third quarter results in detail, including a summary of key highlights on the balance sheet and statements of cash flow. My comments refer to reported results including Headstrong since May 3 of this year unless I call out organic comparisons. On a year-to-date basis, our revenues for the first nine months of 2011 were $1.1577 billion, up 26% overall and 14% on an organic basis compared to the first nine months of 2010. Our adjusted operating income for the first nine months of 2011 was $187.4 million, up 34% compared to the same period last year, representing a margin of 16.2%, up 90 basis points. Our overall business process management revenue growth in the third quarter was 15%, driven by strong Global Client BPM growth of 23%, within which Smart Decision Services grew 43%. With an organic growth rate of 23% the Global Client IT business was a driver for our overall IT business, which grew 9% organically. On a reported basis, our IT business grew 146%, which includes the contribution from Headstrong. Adjusted income from operations increased 43% to $70.9 million representing a margin of 16.5% compared to 15.4% in the third quarter of 2010. This improvement reflected a better cost structure, scale leverage from G&A and a favorable foreign exchange as compared to last year partially offset by focus investments in content sales organization and another growth initiatives. Our adjusted operating income results also reflect the impact of the $3.9 million reserves against the receivable from MS Global. Without this impact our AOI margin would have been 17.4%. Our gross profit for the third quarter totaled $161 million, representing a margin of 37.5% up 120 basis points compared to the same period last year and…

Thank you, Mohit. In closing our third-quarter results continued the 2011year-to-date trends of strong growth in revenue, adjusted operating income and margins and cash flows. In addition our growth was broad based across industry verticals, geographies and product and service lines. We have continued to win new business and our Headstrong acquisition integration and cross-selling results are on track. Genpact was built on a culture of driving operational excellence through Lean Six Sigma that’s in our DNA. As we look at the challenges our clients face today and in the future there are three things that differentiate us from competition. First we have built the signs of process through our innovative SEP framework that cut across silos in an organization and drive effectiveness, generating business impact that can be three to five times the savings when compared to efficiency. Second is our Smart Decision Services where we build insights from data and analytics to help clients, and make smarter decisions and run their businesses better. And the third is to actually implement these recommendations and run the process for clients. It is the interaction of these three capabilities that allows us to deliver unique value to our clients. We will continue to drive investment in our growth strategies. First, building, cutting edge capabilities around the signs of processes through SEP and our analytical capabilities through Smart Decision Services. Second, differentiating Genpact through deep vertical and domain expertise both organically and through acquisitions. Third, expanding in emerging growth market such as China, India and Latin America. Fourth, moving the center of gravity of our leadership closer to our clients. And fifth, co-innovating the clients in key industry verticals with a focus on higher value products and services. Our pipeline remained strong and stable and we are well-positioned to capitalize on the opportunities for growth. However, in an environment where our clients are facing ongoing macroeconomic uncertainty and volatility, which may continue into 2012. It is especially important to be adaptable to the changing priorities these factors may pose. Since the Headstrong acquisition, we have consistently provided an outlook for the year 2011 of 23% to 25% revenue growth and 16% to 16.5% adjusted operating income margin. Our strong performance during the first nine months of the year reflects the diversity and resilience of our business model. Despite the ongoing uncertainty in the global economy, we now expect to finish the full year 2011 ahead of the high end of both of these ranges.

Thank you, Tiger. Erica, could you please open the floor for questions.

(Operator Instructions) And our first question comes from the line of Tien-tsin Huang of JP Morgan. Please proceed. Puneet Jain – JP Morgan: Hi. This is Puneet filling in for Tien-tsin. Tiger, you called out Japan continuing to be weak in this quarter. So can you remind us what percentage of the overall revenue spends from Japan and what’s the outlook there for next year?

I’m going to turn the call over to Mohit, Puneet to answer the question, Mohit?

Right. Puneet, our revenues from Japan which is both for Headstrong and for us combined are in the range of about 10% to 12% of our overall business. Like we have mentioned in the past, the softness that we’re seeing from Japan is more for the consulting business of Headstrong, a little less to do with the underlying Genpact business, which is more annuity and more keep the life on kind of work. And we do expect that even the consulting portion of the business in Japan should comeback over the next few quarters. Puneet Jain – JP Morgan: Right. And Global Clients grew 23% on organic basis, which was higher than where we thought it will be. And you laid out like the drivers Smart Decision Processes, SEP, but that also means that Headstrong contribution come in a little lighter around $62 million compared to $45 million in two months of last quarter. So what were the reasons for weakness in Headstrong, was it primarily Japan or was there anything else as well that was weak there?

No actually, the Headstrong overall revenues for the quarter were as we had expected when we began the quarter. And to your point it was – we had called out the fact that Japan would come in softer as we not only go through Q3, but also Q4. So overall our Headstrong numbers are exactly as we’re anticipating. Puneet Jain – JP Morgan: Okay. Thank you.

Our next question comes from the line of Joseph Foresi from Janney Montgomery Scott. Please proceed. Joseph Foresi – Janney Montgomery Scott: Hi. I wonder if you could talk just a little bit about the present demand environment. What are you seeing on the sales cycle side, pricing, and then if you could just talk a little bit about any updates in Europe?

So, Joe, hi. Firstly on sales cycles, we’re seeing sales cycle to be steady and consistent. It’s not come back to the level they were prior to 2008. But it’s not deteriorated anything over the last three or four quarters, it’s just remained pretty steady. If you think about the business that we have and you divide it up into Smart Decision Services, Technology, and BPM. The sales cycle times for those three parts of our business are different Smart Decision Services is fastest cycle, IT I would say a medium cycle and BPM obviously a longer cycle. So to the extent that the proportion of our Smart Decision Services has grown, our overall cycle times actually have from a weighted average perspective actually improved. However for each of these, the overall cycle times are consistent. Pricing is stable. It continues to be competitive but overall stable and there are some parts of our business such as Smart Decision Services again where we often actually don’t compete as much as we do for example on the technology side and overall again as I would say pricing is stable. The expectations that clients have is continue to drive on productivity as well as driving better outcomes and effectiveness which obviously things like Smart Enterprise Process really helps them. And your last point was on Europe, our European business actually has done Joe and it’s a reflection of the fact that we have made our investments 24 to 30 months back in our front-end business development team and that’s really paying off now. I’m not necessarily certain whether that’s a true reflection of the overall market after all our overall proportion of the overall market is still small, but we have done well in Europe and lastly I know we have talked a couple of times about our European IT business on the SAP side based out of the Netherlands that is now reached stability, over the last couple of quarters. Joseph Foresi – Janney Montgomery Scott: Okay and then I was just curious maybe you could talk a little bit about your thoughts on 2012, just anything you are hearing from clients at this stage in the cycle anything that you could share with us as to why you might think it might be different than ‘07, ‘08 obviously the micro headlines are there and anything maybe we should watch as far as potential indicators one way or another given what the trajectory for next year?

Now, Joe so, let me respond first to the way clients think about the current environment and 2012. I think clearly everyone is aware of uncertainty and volatility and therefore as they think about the future, I think one reaction is that they don’t want to add capacity, even if they think that they seeing higher revenue for themselves. So obviously, flexible cost structure is a big agenda on everyone’s mind. If I compare to current environment in our client leadership teams to 2008, I think the single biggest difference I would say is leadership teams are stable, leadership teams were not stable in 2008. A number of our client organizations underwent changes in leadership teams. And those tend to slow down decision making. So I would say right now clients are continuing to take decisions. They are reprioritizing their decisions in terms of whether they need more flexibility in cost, whether they want to optimize and drive effectiveness and standardization in some of their existing operations before they move stuff to us. Part of the reason was not because in terms the results were bad because we go in and reengineer process for them. So continued caution, continued watchfulness on uncertainty, variabilization of cost, but decision making continued and drive for effectiveness which is very keenly been driven by all of our clients. And then it’s impact in 2012 too early to talk about it Joe. We are going through our planning exercise again by client, by industry, by geography and we will be ready with it by the end of the year. That’s where I’d overall paint the picture. Joseph Foresi – Janney Montgomery Scott: Okay. If I could sneak one last one in. It seems like margins are moving a little bit higher here. I know in the past management has talked about 50 basis points increase in margins. I know that wasn’t the case this year. How should we think about the margin profile of the business heading into next year? Thanks.

Joe, I would continue to say that when we had talked about at the investor day our medium term outlook of margins being steady and not necessarily growing because of our planned investments. That would be the way we would continue to think about the next couple of years. The current increase in margin is driven by a combination of obviously some FX gains that Mohit talked about, which obviously we don’t plan for. And we don’t plan for that even in our outlook. And to some extent our investments have taken a little longer than we had planned. If you think about the additions to our business development team, it takes time to hire the right resources particularly the kind of resources that we are talking about in terms of industry domain expertise. And of course when we talk about setting up Brazil and Dubai probably a quarter later then we would have thought we would set it up. And we set up centers when we have anchor clients. And in both cases we now have anchor clients. So I would think about those investments therefore accelerating as Mohit said into 2012 and therefore our margins continuing to be steady. Joseph Foresi – Janney Montgomery Scott: Okay. Thank you.

Our next question comes from the line of Bhavan Suri with William Blair and Company. Please proceed. Bhavan Suri – William Blair and Company: Hi, guys. Just a quick question on pipeline, Tiger, in the past you’ve given us commentary around potentially total contract value increasing on a sequential basis or things like that could you provide any further color?

Bhavan, hi. Our pipeline as I said is steady. So the way I would characterize the pipeline right now is that it’s overall steady. But you must understand that a lot of our new business development resources that I talked about have just got added in the last couple of quarters, in fact more in the last quarter. They take time to hit the ground, they take to generate the pipeline and then to win deals particularly on the BPM side. So, overall we feel good about the momentum that, that pipeline would have as we go forward, but at that moment I would characterize the pipeline as steady. I did – we have called out consistently and I talked about it even in this call, the fact that U.S. consumer facing financial services and Japan continues to be weak in our pipeline and that just continues. Bhavan Suri – William Blair and Company: Right, and then you have commented in the past that the introduction of folks like McKinsey and Bain and consultants into the process has led especially for BPM to slightly longer decision cycles and sales cycles. Has that improved or do you see the same sort of pattern or trend?

It’s – Bhavan that it – as I said the sales cycles haven’t changed, they have remained consistent and steady. The introduction of some of the most strategic consultants into a discussion about transformation for our clients is again a reflection of some of the medium variabilization of costs that our clients are really thinking about. As well as a real optimization of their own operations and shared services and obviously moving work to people like us. It’s a combination of all three. So, we’re finding more and more those conversation leading to our engagement far more upfront in driving that transformation agenda, and I talked about a couple of examples to that end. Bhavan Suri – William Blair and Company: Sure.

But that’s what we are seeing. It’s not deteriorating cycle times any further and cycle times continued to make steady. Bhavan Suri – William Blair and Company: Great, and one quick last one. One of the things that we sort of thought about, especially as clients looks for sort of operational flexibility and variable cost structures is this BPO as a service or pricing outside of FTEs and more in sort of a non-linear basis. Could you give us an update of how the business is tracking with those sorts of initiatives?

Bhavan, the business as tracking well, but probably less in terms of traction than what we would like. I think whether it is outcome base pricing, which we see in obviously those arena where outcomes are ready to measure that would be procurement that would be receivables management order to cash. We see continue attraction there probably it should be faster, but it takes time to get clients comfortable that they will pay us only an outcomes. We see traction on transaction based pricing when we bundle services along with technology and move it to the clients. We see that happening more in emerging markets, we see that happening more in mid size companies. I think larger companies take time to get there, but obviously our push is in that direction because it aligns goals of our clients along with our goals. Bhavan Suri – William Blair and Company: All right, great. Great, thanks for taking my questions, guys.

Thanks, Bhavan.

Our next question comes from the line of Arvind Ramnani with UBS. Please proceed. Arvind Ramnani – UBS: Hi, congrats on a good quarter.

Thanks, Arvind. Arvind Ramnani – UBS: Just couple of things. I mean that your guidance essentially is 25% plus is there a reason you haven’t kind of quantified it more specifically?

Arvind, it's actually a reflection of the environment we are all in. It is – I mean I think the words we always used which is probably resonates with everyone is uncertainty and volatility. We clearly see our revenue being ahead of our guidance and hind up our guidance of 23 to 25. There is – we don’t see in this environment need to call out an exact number, I mean that’s the way I would characterized it. Arvind Ramnani – UBS: Okay. And in terms of your MF Global, I mean, I know you really haven’t quantified your revenue, but I mean would $20 million to $25 million be kind of a safe way to think about it?

So one, we don’t talk about revenues of individual clients as you know Arvind, irrespective of what client it is. So I would say that’s probably at the high end, it wouldn’t be that high. But more importantly, I think as we think about the balance of the year we’ve taken whatever impact we think MF Global would have on revenue into that outlook. And as we plan for next year we would obviously take that into account as we planned for our 2012 numbers. Arvind Ramnani – UBS: Great. You mentioned that Europe was very strong because of some of the investments you’ve made, so I mean should we expect this geography to continue to remain strong over the next few quarters or is some of the macros starting to impact you guys as well?

No actually, I would say for us Europe would continue to be strong, our pipeline in Europe continues to be very good. And our investments as I said are continuing to payoff. And these are as you know long cycle decisions and then long cycle ramps, so far us Europe will continue to be a good growth geography. Arvind Ramnani – UBS: Great. Now in terms of your organic versus inorganic revenue, I mean basically the Headstrong related revenue, can you give us some dimension how should we’d be thinking about that?

Yes. One other point on Europe, I just remembered Arvind you must know that in Europe our financial services exposure is actually very low. And as we think about the changes that are going through in Europe, obviously financial services is probably the one that’s most impacted. Our own exposure of clients in financial services in Europe is low. So to that extent, that’s one of the reasons why we’ve had a good quarter in Europe and we continue to expect good quarters going forward. Your question was on – was on organic growth, if you can just repeat the question, Arvind? Arvind Ramnani – UBS: Yeah, sure sir. I mean how should we think about kind of the organic growth versus Headstrong related growth for the quarter, I know you don’t break it out, but can you help us, I mean how do we think about it?

If you look at the last couple of quarters, you would see that our original guidance of 10% to 13%, which was our organic growth guidance. We’ve come in at the higher end or slightly ahead of that higher end of that guidance over the last couple of quarters. So I would say that’s the way we would characterize the environment going into the last quarter. Arvind Ramnani – UBS: Okay. And just one last one, in terms of kind of your cross-selling opportunities, I mean when you acquired Headstrong, you obviously said that’s going to take like a few months before the firm is integrated and we’ve had that few months. So, I really start to think about like 2012, I mean how does the pipeline look from a cross-selling perspective? Will you all pretty much be in a 100% overlap will be selling across the border, I mean how is the cross-selling opportunities kind of panning out?

Arvind, we’re planning out exactly and actually a little better than what we had expected. As you would expect, our Smart Decision Services type businesses and some of the wins on cross-sells that we talked about are all shot cycles, Smart Decision Services type revenue. Those have immediately gathered momentum. We talked about 11 cross-sell wins, six of them in this quarter. Most of them in fact probably all of them are around the Smart Decision Services and technology arena both of which are softer decision cycles. We have a very good pipeline around BPM through cross-sell for the same clients. These are longer cycle decisions and these are big decisions for a number of these clients. In many cases it’s the first time that they will be taking the decision around business process management. So as we think about 2012, we would incorporate that into our thinking about 2012 for Headstrong’s cross-sell number. Arvind Ramnani – UBS: Excellent. Good quarter and good luck for the remainder of the year

Thanks Arvind.

Our next question comes from the line of Manish Hemrajani with Oppenheimer. Please proceed. Manish Hemrajani – Oppenheimer: Hi, good quarter guys. Thanks for taking my call.

Thanks.

Hi Manish. Manish Hemrajani – Oppenheimer: Can you talk about where you saw specific strength in the quarter versus what your internal expectations were? And do you expect that strength to continue in the near term?

Sure. So, I think if you look at the revenues per se the strength in the quarter would be on our shorter cycle Smart Decisions Services. We saw that momentum and traction continuing just as we had in the previous quarter. It is an area where it’s a win-win with clients and us. It’s quicker payback for customers. It’s good for us we earn slightly higher margins on the business. It does not involve that much change in management. So, we see this area from Smart Decision Services continuing to be again a strong momentum like we saw in quarter three. I think other areas where we grew were in finance and accounting. We mentioned to you the CPG, retail space that’s ramping up very well. And we see that continuing over the next few quarters. On the margins side, again quarter three was very good to try to explain a little bit, we got some help from foreign exchange, but we continue to get scale on G&A, which is very helpful. We continue to see productivity in our IT and infrastructure areas, with the IT virtualization and server consolidations that we are doing so all that helping coming in. And while we have the ability to make all the investments that we’ve planned for, there is a facing involved based on business lifecycle just like when we open new geography in Brazil or Dubai or in Columbia, the actual investments and the timing are really depended on a lot of other variable. So overall the kinds of strength is on quarter three is that should continue other than investments which are more of a timing thing and we will accelerate that those investments in the quarter four and quarter one of next year. Manish Hemrajani – Oppenheimer: Okay, great, great. My apologies if you already spoke about this, but can you throw some light on your exposure to Headstrong to MF Global and what level of impact do you see from this client?

Well at this point we mentioned that we have created a reserve of $3.9 million, which substantially covers the entire receivables that we have from this customer, so we’ve taken no chances on that front. I think going forward like Tiger said we have to assess the situation, we got to see, we got to get into a dialogue to see what services will continue and not continue, but for now we’re fully covered on the exposure of the receivable that we have from this company.

And Manish, I would add that both for balance of 2011 outlook as well as our planning process that we have obviously now kicked off for 2012, we are obviously incorporating and have incorporated in the outlook our MF – the fact that MF Global is in the situation there. Manish Hemrajani – Oppenheimer: Got it. Couple of housekeeping questions, what are your plans for higher CapEx deployment in 4Q, and how should we look at CapEx for next year?

So, like I said for the full-year we expect it to be in the range of 2.3% to 2.5% of revenues. It’s been 1.8% so far. So clearly there will be an acceleration which has already begun in the last month of this quarter and will continue in Q4. Mainly in the areas of refresh of technologies, which we’re going to do in fourth quarter, and is also going to be an infrastructure in expansion that we’re doing in China as well as in our new sites in Brazil and Dubai. So we will see some of that happening in the fourth quarter. If you look forward in ‘12, it is premature we’ve not done our plans at this point in time. We will come back to you. Clearly some of the effectiveness that we have seen this year, we expect to continue over 2012. So those days off CapEx being in the 6%-7% range of revenue are over in the mid – in the long-term as far as I’m concerned. But we will come back to you with those ranges as we plan for 2012. Manish Hemrajani – Oppenheimer: Okay. One last one from me. Can you remind us the impact of the rupee volatility on margins and what are you assuming in your guidance?

So, we have a long-term hedge policy where we hedge out two to three years. We don’t indicate unfortunately our individual hedge rates and the exact impact in a particular quarter as it compromises our commercial position in many cases. So my apologizes for that, but clearly our hedge rates in this quarter have been better than the hedge rates in the same quarter last year. And we are seeing a benefit of that in our cost lines. The foreign exchanges, there is a second aspect of foreign exchange, which is a re-measurement of our receivables and some aspects of our balance sheet that appears below the income from operations line. We do disclose that. We made a $9.7 million gain on that in this quarter compared to a $5.5 million gain in the quarter three of last year. So, we got a benefit of about $4.2 million relative to Q3 of last year on foreign exchange remeasurement below the line. It does not impact our adjusted operating income, but it does impact our net income and EPS. Manish Hemrajani – Oppenheimer: Thank you. That’s all I have.

Our next question comes from the line of Sachin Jain with Kaufman Brothers. Please proceed. Sachin Jain – Kaufman Brothers: Hi, guys, good set of numbers of here. My first question is at a higher level, how do you find the current slowdown different from what do you saw in 2008, 2009 in terms of how it is impacting your BPO business?

Sachin, hi. As I was saying earlier, the biggest difference between the current environment and 2008, 2009 is the fact that our clients’ leadership teams are stable. They have very clearly determined over the last two years, not to add capacity. So they are not in a mode of saying I need to restructure to take further capacity out. They are in a mode of saying of how do I convert a lot of my additional capacity needs as well as exciting capacity into variable costs. The other thing that they are doing is taking a looking at all their operations and saying, how do I find way to drive more optimization and effectiveness in those operations, whether it is working with someone like us to move work or it is actually having us participate in driving a big transmission agenda. And the third and this is interesting, because a lot of our clients for some quarters now and we’ve talked about it are focused on how to drive more growth? This is the low growth world and therefore, how to get that incremental growth in developed economies, which is a tough task and using Smart Decision Services to do that. And then when we look at emerging economies, a number of them are jumping onto emerging economies and saying, how do I grab more share in emerging economies? How do I ride the growth wave in emerging economies? Because those are important to get growth for the company for them. And we are participating in every one of these moves that our clients are making, very different from the thinking and behavior in the last cycle. Sachin Jain – Kaufman Brothers: Fair enough. And then, can you talk about the onsite-offshore mix in your IT services business? And how do you expect this mix to trend over the next few quarters?

Obviously, our onsite-offshore mix has changed since our acquisition and integration of Headstrong. Headstrong having a much higher onshore proportion. A lot of our work around Smart Decision Services, particularly the re-engineering efforts that we have with our clients are onshore in their centers optimizing their operations. So to the extent that continues to grow. It will continue to add more revenues and resources in onshore locations, not just in the U.S. but also in onshore locations in Europe, onshore locations in Latin America as we start working with clients there, in South Africa, as we’ve grown that business, in China and so on. And then of course, onshore operating centers, over the last two or three years, our onshore resources for example in the U.S. have grown in our operating centers. And these are doing types of work that often needs to be closer to clients. It is sensitive from a client touch perspective. It is in the healthcare arena. It is in the order to cash arena a lot of that is much closer to our clients. And the way we think about this is a global delivery of services. In many cases we don’t think about that delivery of services as onshore offshore, it will surprise you a little bit, but we don’t track that as a very deterministic metric. Most often we in dialogue with clients figure out the right mix that solves the problem for that client for that particular situation. And more-and-more we’re finding in some cases given the high value added services that we’re getting into lot of the expertise we draw from markets that are more developed across the world. Sachin Jain – Kaufman Brothers: Great. Thanks for taking my questions

Thank you

And next question comes from the line of Brian Keane with Deutsche Bank. Please proceed. Brian Keane – Deutsche Bank: Yeah. Hi, good morning I just wanted to make sure I understand the demand picture we get a lot of questions about the last three months and I know you guys commented that the US consumer finance in Japan was weak performance still weak. Any other change that you would point out over the last few months that have been different in the environment, I just want to be specific there. Thanks.

None, Brian that we would point out other than the fact that as I said the European banking environment, I suspect one would say is volatile and uncertain. However, as I said our exposure to that environment is very small we’ve actually obviously tried to grow that business over time, but it takes time to do that. So in our pipeline we don’t see any change other than the two that we’ve already pointed out. Brian Keane – Deutsche Bank: What about Headstrong, I know they have a lot of capital markets exposure and obviously that’s been a huge area of volatility, does that outlook there still hold?

At the moment yes, obviously MF Global as I said, we have already incorporated into the outlook, the impact of MF Global but other than that at the moment in our pipeline and in the work we haven’t seen any impact come through, but these are uncertain times. These are volatile times. I’m sure everyone is evaluating their view of the future and you know we will have to monitor the situation as we go forward. Brian Keane – Deutsche Bank: Okay. Then just two more quick ones from me, I guess on the adjusted operating margins, do you guys expect that to expand on the year-over-year basis in 4Q ‘11? And then secondly how big is empire in terms of annual revenue and maybe the growth rate that’s been growing in? Thanks so much.

So on the first one, as I said Bryan earlier, our adjusted operating income margins we had earlier indicated even in our medium-term outlook will remain stable and all our productivity drive and improvement in G&A etcetera, we would reinvest back in the three areas that we pointed out very clearly global growth, front end sales and client facing teams with these domain expertise and new product innovation particularly innovating on new products along with our clients. Those investments will continue and that will have our adjusted operating income margins remain stable over the next couple of years. To your question on EmPower Mohit?

EmPower is a reasonably small impact right now. This year the impact of EmPower would be not even a hardly a couple of million dollars.

And obviously it’s in a space that is high growth. It’s in a space where almost every client in every industry wants to find a solution for in terms of driving customer service conversations as well as growth and brand and promotion conversations whether it is CPG, pharma, retail or it is financial services, insurance, et cetera. So we expect the business to be actually a high growth business. And we have a team that is extremely expertise-driven in that area. So we are very, very trilled about the fact that they are a part of our team, but in terms of impact for the year, extremely small. Brian Keane – Deutsche Bank: Okay. Congrats on a solid quarter.

I just want to add to Tiger’s comments on margin where he mentioned over the next couple of years. I think you had also asked about Q4 specifically. In Q4 ‘11 clearly the margin would accelerate, that’s how we are at 16.2% today that’s how we’ll get to the higher end of our range. So by definition our quarter four ‘011 margins will be better to get there. I want to make one other clarification for the question asked earlier on I supposed it to Japan. I actually gave a range of 10% to 12%, I had included in that some of the other work we do in China. The true exposure really is 5% to 7%. Just want to clarify that the room. Brian Keane – Deutsche Bank: Mohit, on the 4Q margins, what about on a year-over-year basis, obviously, sequentially they are always strong because of seasonality, but how do they work year-over-year?

Well, on a year-over-year basis, if you recall in quarter four of 2010, we had a completely outstanding quarter for various reasons. There was a lot of business that had got delayed that culminated in quarter four of ‘010. It was a very special quarter for us going back in time. So I would frankly not expect those kind of margins as you saw in quarter four of ‘010, which had unique special causes attached to it. But clearly as far as sequential growth is concerned you should see healthy margins in quarter four of ‘11. Brian Keane – Deutsche Bank: Okay, great. Thanks so much.

And next question comes from the line of Kunal Tayal with Bank of America Merrill Lynch. Please proceed. Kunal Tayal – Bank of America Merrill Lynch: Hi, thanks. Tiger just continuing on the 2012 discussion, well the overall pipeline may be flattish year-on-year basis, is there a difference in terms of the split between hunting and mining opportunities? And also is there a significant difference in terms of plans already available in the system from successful deals during the year versus the same time last year?

I don’t think there is any significant difference between hunting and mining that we would call out at the moment. I think the one that we call and we actually talked about it, is the pipeline has a higher composition than year back of Smart Decision Services and IT, in the overall pipeline reflecting our faster growth of Smart Decision Services which has been happening for the last many quarters, and in the most recent quarter on IT. And those tend to be as I said earlier faster cycle conversion of the pipeline into revenue. So that’s the one that is more significant and material in terms of a difference in the pipeline. Kunal Tayal – Bank of America Merrill Lynch: Sure, got it. And just continuing on the point around Smart Decision Services, while this part of the business is on a secular growth trend, just some perspective on the part of revenues in this part of the business that are project based in nature?

Historically, a lot of the work that we do, in fact a significant portion of the work we do in the analytics area is annuity business not project business and that I think is a big distention between our analytics business and factors as compared to many other analytical services that you would find in the marketplace. A lot of our engagements start with pilots as you can imagine, but very quickly convert to core annuity services over many years. These are long term contracts. And then the other side of Smart Decision Services, which is a much smaller portion, is reengineering services. And reengineering tends to move from project-to-project, but our history of reengineering which is now five years old shows that based on delivery and performance and based on the current environment that people are transforming and optimizing their own operations. They tend to come back for the next round of optimization and the next round of processes that need to be looked at. They are project in nature, but they tend to get repeated into a series of projects. They are more onsite, in fact substantially onsite as I said. But that’s a smaller proportion of the much bigger Smart Decision Services. Kunal Tayal – Bank of America Merrill Lynch: That’s helpful. Thanks.

Our next question comes from the line of Vincent Lin with Goldman Sachs. Please proceed. Vincent Lin – Goldman Sachs: Great, thanks. Tiger, maybe not sure be the dead horse here, but going to next year, just wondering almost feels like relative to last year where you had some client specific delays and kind of making some internal reposition here and restructuring of the business almost feels like the company is better footing now, which is in terms of new client momentum, just in terms of execution et cetera. So just wondering macro volatility aside and the kind of uncertainty that you’ve sighted, how do you feel about the business momentum maybe going to next year versus maybe around the same time last year were just in terms of visibility, the style of business, any color you provide will be helpful. Thanks.

So Vincent, from our perspective, we feel good about our positioning. We feel good about the investments we’ve made which obviously as we think about next year, will start beginning to payoff. We feel good about momentum we have in client discussions. Having said that the environment is different. So, I think it – unfortunately we cannot think about our positioning in the absence of the environment, it is in the presence of the environment. So, that’s what I would respond. We feel very good about our positioning, we feel very good about the investments we’ve made and we continue to make. And we feel very good about the journey that our clients are on in terms of changing the way they run businesses, in terms of variabilization of costs and so on. But the reality is that the environment continues to be uncertain and volatile. Vincent Lin – Goldman Sachs: Okay. And maybe just in trace of the regulatory compliance kind of opportunities, in your prepared remarks you mentioned, kind of the opportunity around solvency, can you provide a more specific color just in terms of the kind of regulatory compliance, what you are doing for clients and to the given all the regulatory changes that was seen right now. How big of opportunity that could mean for you guys over the next couple of years? Thanks.

It – on strategically that would be a big area of focus, investments and new product innovation. In fact it is one of the areas that we are spending time and investment dollars on in terms of building up some of those capabilities. About four years back we did an acquisition of a business called Access that actually brought in risk and enterprise risk capabilities particularly around audits, around stocks, compliance and so on. We’re now adding Basel II and European Basel II and insurance Basel II kind of requirements and needs into it. We already have a very strong practice over many years that we built in financial services around risk and reporting and portfolio monitoring services. All of those are areas that would grow. The specific areas to grow would depend upon the pace of that change, the Frank Dodd Act and how that plays out in terms of needs for our clients to add more resources to get more work done. And we are in dialogue with a number of clients to help solve for those problems for our clients. Vincent Lin – Goldman Sachs: Got it. And then maybe last one for Mohit. It looks like there was a pretty meaningful FX gain this quarter. How should we think about the FX lines below the operating income line for next quarter? Thanks.

Sure. So like I have mentioned below the re-measurement gain in the balance sheet depends on quarter-to-quarter movement in the foreign exchange rate. There has been a lot of volatility in the last 45 days to two months which is why you see larger numbers of gain this time. Assuming the rate does not change, you should not see any gain or any loss in the fourth quarter. Now, it’s hard to predict whether the rates will change in which case there could be a gain or loss, but it’s – for planning purposes we have to assume the rate would remain the same as in quarter three and therefore there will be no gain and no loss in the next quarter. Vincent Lin – Goldman Sachs: Great. Thanks a lot for the quarter.

Our last question comes from the line of Ashwin Shirvaikar with Citi. Please proceed. Ashwin Shirvaikar – Citi: Hi, thank you. Tiger, you had a comment in there that you said you need to be adaptable to macro changes and so on, which I guess to some extent you’ve always been, but can you give some examples of how Genpact as an organization including Headstrong is changing to make this happen, how it might manifest itself in the financials?

Ashwin, that’s actually a great question. We do think that today’s world, in almost every industry and certainly in our business demands us in order to be good partners of our clients to be really flexible and adaptable. Our clients are facing a world of uncertainty and volatility. They changed their priorities often and for us to be able to be in those dialogs so that we can actually together decide priorities and then for us to be able to change the organization and the delivery capabilities to meet those changed needs is very important. One of the ways clearly we identified about three or four quarters back, for us to be able to do that really well is to shift the center of gravity of our leadership team to be more balanced between our client locations and our delivery centers. By the end of this year, in the next couple of months we would have completed that transition where half our leadership team, senior leadership team would be in our client locations with the capability to have dialogue with the C-suite of our clients understanding their changing priorities and then from a delivery perspective, the ability to move resources across different verticals, across different geographies, the ability to move additional resources into areas that we see growth in – and example of that would be the actions we’ve taken over the last four quarters around Smart Decision Services, around reengineering and optimization of processes and client locations for a number of our clients. Our ability to move resources to be able to offer them up to clients so that they can use them and these are Black Belts these are people with a deep domain expertise in finance and accounting or in financial services or in procurement. I would say that combination is what is necessary and that combination is I think what we have that makes us different in the marketplace. Ashwin Shirvaikar – Citi: Okay. The couple of smaller questions. When was with regards to – do have a number for penetration of Smart Decision Services in your client base?

Penetration of Smart Decision Services meaning, how much more runway we have is that what you are trying to get to ask us? Ashwin Shirvaikar – Citi: Yeah, what percentage and I know you’re shorter cycle this is shorter cycle works, so it sort of regenerate itself and you can’t really give a pure longer number, longer standing number, but if you have X clients what percent of X knows about Smart Decision Services and is working with you on ASDS project?

No, no I understand. So first of all, I just want to repeat what I’ve said, which is most of Smart Decision Services that we do particularly on the analytics space are actually annuity businesses. These are people who are dedicated to clients, they actually understand the client environment and then they do a series of analytical ranges of model building, inside building for our clients. What they do may change every day, but they are dedicated annuity businesses. Ashwin Shirvaikar – Citi: Right.

Our penetration of our broad client base just in terms of them knowing that the our Smart Decision Services, hopefully is very high, but in terms of using those services, we have a long runway to grow as we look at our client base and then within our client base also we have a huge run rate of growth. More importantly, I think every one of our client in every industry is looking at the availability of data with them and with their competitors and say there is an opportunity to leverage the data we have to build insight, there is a need to do it and there is a competitive pressure to do because if they don’t do it their competitors will do it. So the secular demand for building insights from data I think far outweighs any other penetration conversation. Ashwin Shirvaikar – Citi: Okay got it. Now that’s a very useful point. One last question, in your comments obviously you mentioned U.S. consumer facing in Japan and you quantify Japan, but can you quantify U.S. consumer facing also?

Yeah, our U.S. consumer facing business is about 6% to 7% of our overall revenue, but more important point there Ashwin is additions to that is what we are saying is low because our pipeline around U.S. consumer facing financial services is smaller than it used to be. Ashwin Shirvaikar – Citi: Okay got it. So cumulatively Japan plus that it’s maybe 12% 13% and the rest of the business is fine?

And so is the business that we already do in Japan and the business we already do with the U.S. consumer financial services is just that we’re not finding further traction and further growth in U.S., consumer financial services. And in Japan we think there is going to be a time when all of that is going to come back is a question that investment beginning to happen again. Ashwin Shirvaikar – Citi: Absolutely. Great quarter guys. Thank you.

Thanks Ashwin.

Thank you.

I will now turn the call back over to Shishir Verma for any closing remarks.

Thank you, Erica. And thank you everyone for joining us on the call today. If you have any questions, please do not hesitate to reach out to me.

Thank you for your participation in today’s conference. This concludes the presentation. Everyone may now disconnect and have a great day.