This document summarizes a summer training project conducted at Genpact on analyzing the effects of inflation on the company's costs and profitability. It includes an analysis of key cost drivers like salaries, benefits, infrastructure expenses, IT expenses, and other employee costs. Trends in these costs and their relationship to factors like headcount, work stations, and inflation rate charged to clients are examined. Key findings are that salary costs are most impacted by inflation, the company charges an average 5% inflation rate to clients, and continuing high inflation could negatively impact future profitability if costs are not further controlled. Suggestions include controlling attrition to reduce hiring costs, negotiating inflation clauses in all contracts, and incrementally increasing inflation rates charged over

1. SUMMER TRAINING PROJECTPRESENTED BY:JagmohanParmarMBA 2C

11. PramodBhasin,President & CEOTiger Tyagarajan,Chief Operating OfficerMohitThukralSr. Vice PresidentBFSI AbhinavKapoorVice President,BFSITathaguptaMallakarAssist. Vice PresidentRahulMalhotraAssist. Vice PresidentNishi AroraAssist. Vice President

13. Current RatioIn US $

14. Acid Test/Quick RatioIn US $

15. Absolute liquid RatioIn US $

16. Debtor Turnover RatioIn US $

17. Debt Equity Ratio

18. Net Profit Ratio

19. Trend of Revenue

20. Trend of Cost of Revenue

23. Source: Nasscom

26. To study the inflation trend in Indian economy.

27. To analyze the effect on the cost drivers in Genpact due to various factors.

28. To know the effect on the profitability of Genpact due to change in the total cost of the company.

31. Inflation forSource: Central statistical Organization, Ministry of Statistics and Programme Implementation, Government of India

32. Source: Macroeconomic and Monetary Developments - First Quarter Review 2009-10, Reserve Bank of India

33. Scope of Research: The research has been conducted in Gurgaon at Genpact India and it includes all the members of Financial Planning & Analysis team.

34. Universe: The people dealing in the finance support team of various BPO companies.

35. Population : Total number of employees working in the Finance Planning and Analysis team in BFSI in Genpact India.

36. Research Design : DescriptiveSampling Frame: all the employees working in the Finance Planning and Analysis (FP and A) team in BFSI in Genpact India.

37. Sample size: The number of elements considered and included in the study is 15.

38. Data Collection:

39. Primary data

40. Secondary data

43. REALIZATION PER RGFTE: In simple words, itcan be defined as the contribution made to the total revenue by each RGFTE employed by the company. Realization per RGFTE = Production revenue Production RGFTE Head count

44. Figure No. 4.1:- Trend of revenue per RGFTE.

46. SALARIES AND BENEFITS: While calculating salaries and benefits, total of all kinds of salaries paid during the year is taken.Cost Driverfor salaries and benefits is the total Head Count of the COE.Salaries & Benefits per RGFTE = Total Salaries & Benefits Total Head Count

47. Figure No. 4.2: Any significant deviation seen in the cost during the contract period.

48. Figure No: 4.3: Cost line that shows maximum increase according to the team.

49. Figure No. 4.4: Trend for salaries per Head Count.

51. Figure No. 4.5: Trend for Infra Expenses per seat.

52. IT EXPENSESCost driver for IT expenses taken is SU, i.e. total number of work stations being used at one time. IT Expenses per SU = Total IT Expenses Total Work Stations

53. Figure No. 4.6: Trend of IT Expenses per seat.

54. OTHER EMPLOYEE COSTS: Training RecruitmentOther expensesCost Driver for other expenses taken is HC. Total of HC up to band 4 and band 5 is taken into consideration.Other expenses per HC = Total Cost Total HC (Band 4 & 5)

55. Figure No.4.7: Trend of other expenses per head count.

56. Figure No. 4.8: Inflation charged in the accounts.

57. Figure No. 4.9: Percentage of inflation charged in the accounts.