Bangalore: India’s No. 2 software exporter, Infosys Technologies Ltd is focused on small acquisitions to boost growth and does not expect pricing to improve in the near term, a top executive said.

However, pricing will likely remain stable until demand increases, chief financial officer V. Balakrishnan said.

Shares of Infosys rose about 1% to a record Rs2,457.90 each in intraday trade. The stock ended up 0.33% on the Bombay Stock Exchange on a day the benchmark Sensex index rose 0.4%.

Infosys, which is sitting on a cash pile of nearly $3 billion (Rs13,890 crore), may look at buying companies in the consulting, back office, healthcare and utilities segments, Balakrishnan said.

Infosys, which is targeting companies with revenue of about $400 million-500 million, may acquire firms in Germany and France to expand its presence in Europe, he said.

Anurag Purohit from Religare Capital Markets said: “They can’t change their basic acquisition philosophy in a year. But they might look at acquisitions more actively than they did earlier."

Balakrishnan also said he is comfortable with margins in the near term, but they could be weighed down by a stronger rupee. Infosys had earlier forecast operating margin for the full year to decline 50-100 basis points. One basis point is one-hundredth of a percentage point.

India’s $60 billion outsourcing sector has taken a hit from the global economic downturn as its core financial clients slammed the brakes on technology spending and demanded sharp price cuts. Infosys has seen pricing drop about 5% over the last six months. Business has slowed in the last one year and deal sizes have become smaller, Balakrishnan said, as clients cut back on discretionary projects.

Infosys stunned markets in April when it forecast its first decline in annual revenue in dollar terms, marking a watershed for a sector that is a magnet for thousands of young job seekers in the country.

The biggest concern for Infosys is the pace of revenue growth, Kaufman Bros analyst Karl Keirstead said, adding that the company may be a couple of quarters away from seeing a real rise in demand.

Balakrishnan said the US will remain its biggest market followed by Europe. “But medium to long term, we want to have at least 40% of our revenues coming from the US, 40% from Europe and 20% from the rest of the world," he said.

Hiring in fiscal 2010 will be on target, Balakrishnan said. The company, which employs at least 100,000 people, recently raised its hiring target to 20,000 people from its earlier forecast of 18,000.