(Address, including zip code, and telephone number, including area code, of registrant’s principal executive office)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “accelerated filer”, “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

The number of the registrant’s common shares, par value $0.01 per share, outstanding as of ~~November 4, 2010~~May 5, 2011 was ~~220,637,516.~~221,149,954.


Item No.			Page No.				Page No.
PART I Financial Statements	PART I Financial Statements				PART I Financial Statements
1.		Unaudited Consolidated Financial Statements				Unaudited Consolidated Financial Statements
		Consolidated Balance Sheets as of December 31, 2009 and September 30, 2010		1		Consolidated Balance Sheets as of December 31, 2010 and March 31, 2011		1
		Consolidated Statements of Income for the three months and nine months ended September 30, 2009 and 2010		3		Consolidated Statements of Income for the three months ended March 31, 2010 and 2011		3
		Consolidated Statements of Equity and Comprehensive Income (Loss) for the nine months ended September 30, 2009 and 2010		4		Consolidated Statements of Equity and Comprehensive Income (Loss) for the three months ended March 31, 2010 and 2011		4
		Consolidated Statements of Cash Flows for the nine months ended September 30, 2009 and 2010		6		Consolidated Statements of Cash Flows for the three months ended March 31, 2010 and 2011		6
		Notes to the Consolidated Financial Statements		7		Notes to the Consolidated Financial Statements		7
2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations		26		Management’s Discussion and Analysis of Financial Condition and Results of Operations		27
3.		Quantitative and Qualitative Disclosures About Market Risk		38		Quantitative and Qualitative Disclosures About Market Risk		38
4.		Controls and Procedures		38		Controls and Procedures		38

PART II Other Information	PART II Other Information				PART II Other Information
1.		Legal Proceedings		40		Legal Proceedings		38
1A.		Risk Factors		40		Risk Factors		38
2.		Unregistered Sales of Equity Securities and Use of Proceeds		40		Unregistered Sales of Equity Securities and Use of Proceeds		38
3.		Defaults upon Senior Securities		40		Defaults upon Senior Securities		39
5.		Other Information		40		Other Information		39
6.		Exhibits		41		Exhibits		40

SIGNATURES	SIGNATURES			42	SIGNATURES			41


	Notes		As of December 31, 2009		As of September 30, 2010		Notes		As of December 31, 2010		As of March 31, 2011
Assets
Current assets
Cash and cash equivalents		4	$	288,734	$	360,869		4	$	404,034	$	351,766
Short term investments		5		132,601		42,988		5		76,985		129,484
Accounts receivable, net		6		136,280		164,070		6		174,654		173,292
Accounts receivable from related party, net		6		116,228		129,248		6, 18		131,271		134,722
Short term deposits with related party				9,634		—
Deferred tax assets		17		45,929		34,659		17		21,985		14,549
Due from related party				9		6		18		3		3
Prepaid expenses and other current assets				116,551		153,018				126,848		155,468

Total current assets			$	845,966	$	884,858			$	935,780	$	959,284
Property, plant and equipment, net		9		189,112		200,139		9		197,166		187,630
Deferred tax assets		17		36,527		32,625		17		35,099		37,651
Investment in equity affiliates		18		588		2,202		18		1,913		1,782
Customer-related intangible assets, net		10		36,041		36,702		10		33,296		30,298
Other intangible assets, net		10		187		100		10		51		627
Goodwill		10		548,723		559,388		10		570,153		578,040
Other assets				90,421		111,273				120,003		109,630

Total assets			$	1,747,565	$	1,827,287			$	1,893,461	$	1,904,942


	Notes		As of December 31, 2009			As of September 30, 2010			Notes		As of December 31, 2010			As of March 31, 2011
Liabilities and equity
Current liabilities
Short-term borrowings			$	177		$	—
Current portion of long-term debt				44,715			37,400				$	24,950		$	12,483
Current portion of capital lease obligations				527			805					702			631
Current portion of capital lease obligations payable to related party				1,429			1,208			18		1,188			1,196
Accounts payable				16,276			14,788					12,206			9,908
Income taxes payable		17		1,579			25,558			17		8,064			16,518
Deferred tax liabilities		17		264			262			17		489			3,932
Due to related party				7,843			7,081			18		4,030			2,954
Accrued expenses and other current liabilities				322,773			263,650					270,919			223,009

Total current liabilities			$	395,583		$	350,752				$	322,548		$	270,631
Long-term debt, less current portion				24,950			—
Capital lease obligations, less current portion				1,570			1,251					741			553
Capital lease obligations payable to related party, less current portion				1,809			1,495					1,748			1,535
Deferred tax liabilities		17		4,398			1,232			17		2,953			2,234
Due to related party				10,474			10,985			18		10,683			10,720
Other liabilities				109,034			81,293					73,546			72,171

Total liabilities			$	547,818		$	447,008				$	412,219		$	357,844

Shareholders’ equity
Preferred shares, $0.01 par value, 250,000,000 authorized, none issued				—			—					—			—
Common shares, $0.01 par value, 500,000,000 authorized, 217,433,091 and 220,298,649 issued and outstanding as of December 31, 2009 and September 30, 2010, respectively				2,174			2,202
Common shares, $0.01 par value, 500,000,000 authorized, 220,916,960 and 221,066,519 issued and outstanding as of December 31, 2010 and March 31, 2011, respectively												2,208			2,210
Additional paid-in capital				1,063,304			1,096,711					1,105,610			1,109,060
Retained earnings				278,911			375,063					421,092			457,211
Accumulated other comprehensive income (loss)				(146,993	)		(96,288	)				(50,238	)		(24,344	)

Genpact Limited shareholders’ equity			$	1,197,396		$	1,377,688				$	1,478,672		$	1,544,137
Noncontrolling interest				2,351			2,591					2,570			2,961

Total equity			$	1,199,747		$	1,380,279				$	1,481,242		$	1,547,098
Commitments and contingencies

Total liabilities and equity			$	1,747,565		$	1,827,287				$	1,893,461		$	1,904,942


			Three months ended September 30,						Nine months ended September 30,								Three months ended March 31,
	Notes		2009			2010			2009			2010			Notes		2010			2011
Net revenues
Net revenues from services - related party		18	$	111,459		$	122,759		$	333,909		$	354,011			18	$	113,338		$	112,961
Net revenues from services - others				172,981			198,812			489,216			563,406					174,881			217,592

Total net revenues				284,440			321,571			823,125			917,417					288,219			330,553

Cost of revenue
Services		14, 18		166,995			204,833			496,516			572,619			14, 18		176,685			214,487

Total cost of revenue				166,995			204,833			496,516			572,619					176,685			214,487

Gross profit			$	117,445		$	116,738		$	326,609		$	344,798				$	111,534		$	116,066
Operating expenses:
Selling, general and administrative expenses		15, 18		67,242			71,272			194,965			219,440			15, 18		72,891			67,441
Amortization of acquired intangible assets		10		6,382			3,875			19,747			12,159			10		4,219			3,077
Other operating (income) expense, net		18		(1,092	)		(839	)		(3,970	)		(4,780	)		18		(2,830	)		(956	)

Income from operations			$	44,913		$	42,430		$	115,867		$	117,979				$	37,254		$	46,504
Foreign exchange (gains) losses, net				2,576			(5,513	)		2,005			73					731			(1,567	)
Other income (expense), net		16, 18		305			1,210			3,448			3,324			16, 18		1,270			3,097

Income before share of equity in (earnings) loss of affiliates and income tax expense			$	42,642		$	49,153		$	117,310		$	121,230
Income before share of equity in loss of affiliates and income tax expense																	$	37,793		$	51,168
Equity in loss of affiliates				161			104			596			709					333			133

Income before income tax expense			$	42,481		$	49,049		$	116,714		$	120,521				$	37,460		$	51,035
Income tax expense		17		7,895			7,490			18,430			19,572			17		7,217			13,122

Net Income			$	34,586		$	41,559		$	98,284		$	100,949				$	30,243		$	37,913
Net income attributable to noncontrolling interest				1,524			1,428			5,572			4,797					2,069			1,794

Net income attributable to Genpact Limited shareholders			$	33,062		$	40,131		$	92,712		$	96,152				$	28,174		$	36,119

Net income available to Genpact Limited common shareholders		13	$	33,062		$	40,131		$	92,712		$	96,152			13	$	28,174		$	36,119
Earnings per common share attributable to Genpact Limited common shareholders		13														13
Basic			$	0.15		$	0.18		$	0.43		$	0.44				$	0.13		$	0.16
Diluted			$	0.15		$	0.18		$	0.42		$	0.43				$	0.13		$	0.16

Weighted average number of common shares used in computing earnings per common share attributable to Genpact Limited common shareholders
Basic				215,794,607			219,630,410			215,136,984			218,847,260					217,956,146			221,008,760
Diluted				221,799,597			224,831,250			219,228,874			224,583,494					223,972,059			225,543,290


	Genpact Limited Shareholders																					Genpact Limited Shareholders
	Common shares				Additional Paid-in Capital				Retained Earnings			Accumulated Other Comprehensive Income (loss)				Non controlling interest			Total Equity			Common shares				Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (loss)			Non controlling interest			Total Equity
	No. of Shares		Amount									Accumulated Other Comprehensive Income (loss)			No. of Shares				Total Equity			Amount				Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (loss)			Non controlling interest			Total Equity
Balance as of January 1, 2009		214,560,620	$	2,146	Additional Paid-in Capital		$	1,030,304	Retained Earnings		$	151,610			$	Non controlling interest	(342,267	)	$	2,573		$	844,366
Balance as of January 1, 2010																							217,433,091	$	2,174	$	1,063,304	$	278,911	$	(146,993	)	$	2,351		$	1,199,747
Issuance of common shares on exercise of options (Note 12)		1,523,358		15		7,432				—			—				—			7,447			1,134,614		11		6,283		—		—			—			6,294
Issuance of common shares under the employee share purchase plan (Note 12)		31,327		—		289				—			—				—			289			10,427		—		142		—		—			—			142
Noncontrolling interest on business acquisition																							—		—		—		—		—			502			502
Distribution to noncontrolling interest		—		—		—				—			—				(5,586	)		(5,586	)		—		—		—		—		—			(1,743	)		(1,743	)
Share-based compensation expense (Note 12)		—		—		15,256				—			—				—			15,256			—		—		4,486		—		—			—			4,486
Comprehensive income:
Net income		—		—		—				92,712			—				5,572			98,284			—		—		—		28,174		—			2,069			30,243
Other comprehensive income:
Net unrealized income (loss) on cash flow hedging derivatives, net of taxes		—		—		—				—			99,846				—			99,846			—		—		—		—		54,156			—			54,156
Net unrealized gain (loss) on investment in U.S. treasury bills		—		—		—				—			35				—			35			—		—		—		—		197			—			197
Currency translation adjustments		—		—		—				—			(1,179	)			(3	)		(1,182	)		—		—		—		—		19,471			(125	)		19,346

Comprehensive income (loss)		—		—		—				—			—				—		$	196,983																$	103,942

Balance as of September 30, 2009		216,115,305	$	2,161	$	1,053,281			$	244,322		$	(243,565	)		$	2,556		$	1,058,755
Balance as of March 31, 2010																							218,578,132	$	2,185	$	1,074,215	$	307,085	$	(73,169	)	$	3,054		$	1,313,370


	Genpact Limited Shareholders																					Genpact Limited Shareholders
	Common shares				Additional Paid-in Capital				Retained Earnings			Accumulated Other Comprehensive Income (loss)				Non controlling interest			Total Equity			Common shares				Additional Paid-in Capital			Retained Earnings		Accumulated Other Comprehensive Income (loss)			Non controlling interest			Total Equity
	No. of shares		Amount									Accumulated Other Comprehensive Income (loss)			No. of shares				Total Equity			Amount				Additional Paid-in Capital			Retained Earnings		Accumulated Other Comprehensive Income (loss)			Non controlling interest			Total Equity
Balance as of January 1, 2010		217,433,091	$	2,174	Additional Paid-in Capital		$	1,063,304	Retained Earnings		$	278,911			$	Non controlling interest	(146,993	)	$	2,351		$	1,199,747
Balance as of January 1, 2011																							220,916,960	$	2,208	$	1,105,610		$	421,092	$	(50,238	)	$	2,570		$	1,481,242
Issuance of common shares on exercise of options (Note 12)		2,795,669		28		18,000				—			—				—			18,028			75,491		1		625			—		—			—			626
Issuance of common shares under the employee share purchase plan (Note 12)		32,389		—		444				—			—				—			444			12,224		—		153			—		—			—			153
Issuance of common shares on vesting of restricted share units (Note 12)		37,500		—		—				—			—				—			—
Noncontrolling interest on business acquisition		—		—		—				—			—				502			502
Net settlement on vesting of restricted share units (Note 12)																							61,844		1		(393	)		—		—			—			(392	)
Distribution to noncontrolling interest		—		—		—				—			—				(4,700	)		(4,700	)		—		—		—			—		—			(1,497	)		(1,497	)
Share-based compensation expense (Note 12)		—		—		14,963				—			—				—			14,963			—		—		3,065			—		—			—			3,065
Comprehensive income:
Net income		—		—		—				96,152			—				4,797			100,949			—		—		—			36,119		—			1,794			37,913
Other comprehensive income:
Net unrealized income (loss) on cash flow hedging derivatives, net of taxes		—		—		—				—			43,765				—			43,765			—		—		—			—		18,297			—			18,297
Net unrealized gain (loss) on investment in U.S. treasury bills		—		—		—				—			202				—			202			—		—		—			—		4			—			4
Currency translation adjustments		—		—		—				—			6,738				(359	)		6,379			—		—		—			—		7,593			94			7,687

Comprehensive income (loss)		—		—		—				—			—				—		$	151,295																	$	63,901

Balance as of September 30, 2010		220,298,649	$	2,202	$	1,096,711			$	375,063		$	(96,288	)		$	2,591		$	1,380,279
Balance as of March 31, 2011																							221,066,519	$	2,210	$	1,109,060		$	457,211	$	(24,344	)	$	2,961		$	1,547,098


	Nine months ended September 30,						Three months ended March 31,
	2009			2010			2010			2011
Operating activities
Net income attributable to Genpact Limited shareholders	$	92,712		$	96,152		$	28,174		$	36,119
Net income attributable to noncontrolling interest								2,069			1,794

Net income							$	30,243		$	37,913

Adjustments to reconcile net income to net cash provided by (used for) operating activities:
Depreciation and amortization		38,893			43,128			13,987			14,003
Amortization of debt issue costs		434			310			116			58
Amortization of acquired intangible assets		20,182			12,400			4,303			3,119
Provision for doubtful receivables		2,112			(1,373	)
Provision (release) for doubtful receivables								(1,679	)		871
Gain on business acquisition		—			(247	)		(247	)		—
Unrealized (gain) loss on revaluation of foreign currency asset/liability		5,147			(393	)		(2,495	)		(1,020	)
Equity in loss of affiliates		596			709			333			133
Noncontrolling interest		5,572			4,797
Share-based compensation expense		15,256			14,963			4,486			3,065
Deferred income taxes		(18,324	)		(5,719	)		(1,579	)		(249	)
Others, net		(178	)		152			171			(48	)
Change in operating assets and liabilities:
Increase in accounts receivable		(18,072	)		(40,657	)		(16,798	)		(673	)
Increase in other assets		(46,497	)		(49,536	)		(16,062	)		(14,644	)
(Decrease) increase in accounts payable		4,243			(300	)
Decrease in accounts payable								(1,080	)		(1,340	)
Decrease in accrued expenses and other current liabilities		(15,791	)		(23,288	)		(41,670	)		(28,224	)
Increase in income taxes payable		33,546			24,043			7,059			8,459
Increase in other liabilities		3,671			2,823
Increase (decrease) in other liabilities								851			(327	)

Net cash provided by operating activities	$	123,502		$	77,964
Net cash provided by (used for) operating activities							$	(20,061	)	$	21,096

Investing activities
Purchase of property, plant and equipment		(43,949	)		(47,690	)		(25,044	)		(6,187	)
Proceeds from sale of property, plant and equipment		2,026			916			132			219
Investment in affiliates		(296	)		(2,324	)		(2,000	)		—
Purchase of short term investments		(197,419	)		(85,971	)		—			(129,473	)
Proceeds from sale of short term investments		194,822			175,584			132,601			76,973
Short term deposits placed with related party		(101,008	)		(6,485	)
Redemption of short term deposits with related party		144,880			16,213			9,761			—
Payment for business acquisitions, net of cash acquired		(20,196	)		(42,575	)		(25,690	)		(1,564	)
Advance paid for business acquisition								(16,347	)		—

Net cash provided by (used for) investing activities	$	(21,140	)	$	7,668		$	73,413		$	(60,032	)

Financing activities
Repayment of capital lease obligations		(1,946	)		(3,486	)		(588	)		(681	)
Repayment of long-term debt		(20,000	)		(32,500	)		(10,000	)		(12,500	)
Repayment of short-term borrowings		(25,000	)		(165	)
Short-term borrowings, net								(184	)		—
Proceeds from issuance of common shares under share based compensation plans		7,736			18,472			6,436			779
Distribution to noncontrolling interest		(5,586	)		(4,700	)		(1,743	)		(1,497	)

Net cash used for financing activities	$	(44,796	)	$	(22,379	)	$	(6,079	)	$	(13,899	)

Effect of exchange rate changes		(1,170	)		8,882			4,900			567
Net increase in cash and cash equivalents		57,566			63,253
Net increase (decrease) in cash and cash equivalents								47,273			(52,835	)
Cash and cash equivalents at the beginning of the period		184,050			288,734			288,734			404,034

Cash and cash equivalents at the end of the period	$	240,446		$	360,869		$	340,907		$	351,766


Supplementary information
Cash paid during the period for interest	$	3,652		$	1,293		$	481		$	318
Cash paid during the period for income taxes	$	43,557		$	28,872		$	11,139		$	14,705
Property, plant and equipment acquired under capital lease obligation	$	1,250		$	1,066		$	222		$	207

The Company is a global leader in business process and technology management. The Company combines its process expertise, information technology expertise and analytical capabilities, together with operational insight derived from its experience in diverse industries, to provide a wide range of services using its global delivery platform. The Company’s service offerings include finance and accounting, collections and customer service, insurance services, supply chain and procurement, analytics, enterprise application services and IT infrastructure services. The Company delivers services from a global network of approximately 4041 locations in thirteen countries. The Company’s service delivery locations, referred to as Delivery Centers, are in India, the United States (“U.S.”), China, Mexico, Romania, The Netherlands, Hungary, The Philippines, Spain, Poland, Guatemala, South Africa and Morocco.

On March 24, 2010, the Company completed a secondary offering of its common shares by certain of its shareholders that was priced at $15 per share. The offering consisted of 38,640,000 common shares, which included the underwriters exercise of their option to purchase an additional 5,040,000 common shares from the Company’s shareholders at the offering price of $15 per share to cover over-allotments. All of the common shares were sold by shareholders of the Company and, as a result, the Company did not receive any of the proceeds from the offering. The Company incurred expenses in connection with the secondary offering of approximately $591 ~~which have been recognized~~included under ~~‘Other~~other income (expense), ~~net’~~net in the Consolidated ~~Statement~~Statements of Income for the ~~nine-months ended September 30,~~year 2010. Upon the completion of the secondary offering, the General Electric Company’s (“GE”) shareholding in the Company decreased to 9.1% and it ceased to be a significant shareholder although it continues to be a related party in accordance with the provisions of Regulation S-X Rule 1-02(s).

The unaudited interim consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP) for interim financial information and the rules and regulations of the Securities and Exchange Commission for reporting on Form 10-Q. Accordingly, they do not include certain information and footnote disclosures required by generally accepted accounting principles for annual financial reporting and should be read in conjunction with the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2009.~~2010.

The unaudited interim consolidated financial statements reflect all adjustments that management considers necessary for a fair presentation of the results of operations for these periods. The results of operations for the interim periods are not necessarily indicative of the results for the full year.

The accompanying unaudited interim consolidated financial statements have been prepared on a consolidated basis and reflect the ~~unaudited interim~~ financial statements of Genpact Limited and all of its subsidiaries that are more than 50% owned and controlled. When the Company does not have a controlling interest in an entity, but exerts a significant influence on the entity, the Company applies the equity method of accounting. All inter-company transactions and balances are eliminated in consolidation.

The noncontrolling interest disclosed in the accompanying unaudited interim consolidated financial statements represents the noncontrolling partners’ interest in the operation of Genpact Netherlands B.V. and noncontrolling shareholders’ interest in the operation of Hello Communications (Shanghai) Co., Ltd. and the profits or losses associated with the noncontrolling interest in those operations. The noncontrolling partners of Genpact Netherlands B.V. are individually liable for the tax obligations on their share of profit as it is a partnership and, accordingly, noncontrolling interest relating to Genpact Netherlands B.V. has been computed prior to tax and disclosed accordingly in the unaudited interim consolidated statements of income.

The preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements. Significant items subject to such estimates and assumptions include the useful lives of property, plant and equipment, the carrying amount of property, plant and equipment, intangibles and goodwill, the provision for doubtful receivables and the valuation allowance for deferred tax assets, the valuation of derivative financial instruments, the measurements of share-based compensation, assets and obligations related to employee benefits, income tax uncertainties and other contingencies. Management believes that the estimates used in the preparation of the consolidated financial statements are reasonable. Although these estimates are based upon management’s best knowledge of current events and actions, actual results could differ from these estimates. Any changes in estimates are adjusted prospectively in the consolidated financial statements.

Financial instruments that potentially subject the Company to concentration of credit risk are reflected principally in cash and cash equivalents, short term investments, short term deposits, derivative financial instruments and accounts receivable. The Company places its cash and cash equivalents and derivative financial instruments with corporations and banks with high investment grade ratings, limits the amount of credit exposure with any one corporation or bank and conducts an ongoing evaluation of the credit worthiness of the corporations and banks with which it does business. Short term deposits are with GE, a related party, and short term investments are with other financial institutions. To reduce its credit risk on accounts receivable, the Company performs an ongoing credit evaluation of customers. GE accounted for 46% and 44% of receivables as of December 31, 2009 and September 30, 2010, respectively. GE accounted for 41% and 39% of revenues for the nine months ended September 30, 2009 and 2010, respectively, and for 39% and 38% of revenues for the three months ended September 30, 2009 and 2010, respectively.

The Company accounts for its business combinations by recognizing the identifiable tangible and intangible assets and liabilities assumed, and any noncontrolling interest in the acquired business, measured at their acquisition date fair values. All assets and liabilities of the acquired businesses, including goodwill, are assigned to reporting units.

Goodwill represents the cost of the acquired businesses in excess of the fair value of identifiable tangible and intangible net assets purchased. Goodwill is not amortized but is tested for impairment at least on an annual basis on ~~September 30,~~December 31, based on a number of factors including operating results, business plans and future cash flows. Recoverability of goodwill is evaluated using a two-step process. The first step involves a comparison of the fair value of a reporting unit with its carrying value. If the carrying value of the reporting unit exceeds its fair value, the second step of the process involves a comparison of the fair value and carrying value of the goodwill of that reporting unit. If the carrying value of the goodwill of a reporting unit exceeds the fair value of that goodwill, an impairment loss is recognized in an amount equal to the excess. Goodwill of a reporting unit will be tested for impairment between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying amount.

Intangible assets acquired individually or with a group of other assets or in a business combination are carried at cost less accumulated amortization based on their estimated useful lives as follows:

Intangible assets are amortized over their estimated useful lives using a method of amortization that reflects the pattern in which the economic benefits of the intangible assets are consumed or otherwise realized.

In business combinations, where the fair value of identifiable tangible and intangible net assets purchased exceeds the cost of the acquired business, the Company recognizes the resulting gain under ‘Other operating (income) expense, net’ in the Consolidated Statements of Income on the acquisition date.

Financial instruments that potentially subject the Company to concentration of credit risk are reflected principally in cash and cash equivalents, short term investments, short term deposits, derivative financial instruments and accounts receivable. The Company places its cash and cash equivalents and derivative financial instruments with corporations and banks with high investment grade ratings, limits the amount of credit exposure with any one corporation or bank and conducts ongoing evaluation of the credit worthiness of the corporations and banks with which it does business. Short term deposits are with GE, a related party, and short term investments are with other financial institutions. To reduce its credit risk on accounts receivable, the Company performs an ongoing credit evaluation of customers. GE accounted for 43% and 44% of receivables as of December 31, 2010 and March 31, 2011, respectively. GE accounted for 39% and 34% of revenues for the three months ended March 31, 2010 and 2011, respectively.

The authoritative bodies release standards and guidance which are assessed by management for impact on the Company’s consolidated financial statements.

The following recently released accounting standards have been adopted by the Company and certain disclosures in the consolidated financial statements and footnotes to the consolidated financial statements have been modified. Adoption of these standards did not impact the consolidated financial ~~statement amounts~~results as they are disclosure-only in nature:

In December 2010, FASB issued ASU 2010-29 which states that a public entity is required to disclose pro forma information for material business combinations (on an individual or aggregate basis) that occurred in the current reporting period. The disclosures include pro forma revenue and earnings of the combined entity for the current reporting period as though the acquisition date for all business combinations that occurred during the year had been as of the beginning of the annual reporting period. If comparative financial statements are presented, the pro forma revenue and earnings of the combined entity for the comparable prior reporting period should be reported as though the acquisition date for all business combinations that occurred during the current year had been as of the beginning of the comparable prior annual reporting period. The amendments in this update are effective prospectively for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2010. Effective January 1, 2011, the Company adopted ASU 2010-29.

The following recently released accounting standards have been adopted by the Company without material impact on the Company’s consolidated results of operations, cash flows, financial position or disclosures:

In ~~January~~December 2010, ~~the~~ FASB issued ASU 2010-28 which states that for an entity with reporting units having zero or negative carrying amounts, the second step of the impairment test shall be performed to measure the amount of impairment loss, if any, when it is more likely than not that a goodwill impairment exists. In considering whether it is more likely than not that a goodwill impairment exists, an entity shall evaluate whether there are adverse qualitative factors. The amendments in this update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2010. Effective January 1, 2011, the Company has adopted ASU 2010-28. We do not expect a significant impact upon adoption of the provisions of FASB guidance on our consolidated financial statements.

In April 2010, FASB issued ASU 2010-13 which ~~modified~~states that an employee share-based payment award with an exercise price denominated in the scope provisions that were originally contained in ASC 810-10 on noncontrolling interests and also expands required disclosures about the fair value measurements in accounting for a change in ownershipcurrency of a ~~subsidiary and previously held~~market in which a substantial portion of the entity’s equity ~~interests~~securities trades should not be considered to contain a condition that is not a market, performance, or service condition. Therefore, such an award should not be classified as a liability based only on this condition if it otherwise qualifies as equity. The amendments in ~~business combinations achieved in stages. The guidance is~~this update are effective for ~~the first~~fiscal years, and interim ~~or annual reporting period ending~~periods within those fiscal years, beginning on or after December 15, ~~2009 and is to be applied on a retrospective basis.~~2010. Effective January 1, ~~2009,~~2011, the Company has adopted ~~this guidance.~~ASU 2010-13. We do not expect a significant impact upon adoption of the provisions of the FASB guidance on our consolidated financial statements.

Application of the “residual method” of allocating an overall arrangement fee between delivered and undelivered elements will no longer be permitted upon adoption of this new FASB guidance. The provisions of this FASB guidance will be effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010. The Company ~~has elected an~~ early ~~adoption of~~adopted ASU 2009-13, effective January 1, 2010.

Certain reclassifications have been made in the consolidated financial statements of prior periods to conform to the classification used in the current period.

On ~~February 3, 2010,~~March 14, 2011, the Company acquired 100% of the outstanding equity interest in ~~Symphony Marketing Solutions,~~Akritiv Technologies, Inc., a Delaware corporation (“~~Symphony”~~Akritiv”), for cash consideration of ~~$29,303.~~$1,564 and a contingent earn-out component (ranging from $0 to $3,500 based on EBIT levels generated in years ending March 2012, 2013 and 2014), which had an estimated fair value of $1,731 at the acquisition date. Acquisition-related costs incurred by the Company amounted to ~~$521,~~$30, which have been expensed under ‘Selling, general and administrative expenses’ in the Consolidated Statements of Income. Through this acquisition, the Company ~~intends~~acquired proprietary technology platform and software as a service delivered solutions for functions such as credit and accounts receivable management. This will provide an end-to-end offering to ~~enhance its expertise~~clients for receiving and processing customer sales. Goodwill recorded in ~~analytics and data management services.~~connection with the Akritiv acquisition amounted to $2,992.

The acquisition of ~~Symphony~~Akritiv was accounted for as a business combination, in accordance with the acquisition method. The operations of ~~Symphony~~Akritiv and the estimated fair market values of the assets and liabilities have been included in the Company’s consolidated financial statements from the date of acquisition of ~~February 3, 2010.~~March 14, 2011.

The purchase price has been allocated based on management’s estimates of the fair values of the acquired assets and liabilities as follows:

The above acquired customer related intangible assets have estimated useful lives of 8 ~~to 10~~ years.

Cash and cash equivalents as of ~~Delivery Center in Danville~~December 31, 2010 and March 31, 2011 comprise:

In January 2010, the Company finalized an arrangement with Walgreens, the largest drug store chain in the U.S., to acquire a delivery center in Danville, Illinois and entered into a ten year master professional services agreement, or MPSA, with Walgreens. Pursuant to the termsThe components of the ~~MPSA, approximately 500 Walgreens accounting employees in Danville were transferred to Genpact in May 2010. By virtue~~Company’s short term investments as of ~~the combination of the acquisition of the delivery center~~December 31, 2010 and the entry into the MPSA, the Company has acquired an integrated set of activities and assets capable of being managed and conducted for the purpose of providing returns to the Company for a cash consideration of $16,347. Through this acquisition, the Company strengthens its offering in the healthcare industry.

The acquisition of the delivery center in Danville was accounted for as a business combination, in accordance with the acquisition method. The operations of Danville and the estimated fair market values of the assets and liabilities have been included in the Company’s consolidated financial statements from the date of acquisition of May 1, 2010.

~~The purchase price has been allocated based on management’s estimates of the fair values of the acquired assets and liabilities~~March 31, 2011 are as follows:

~~Cash and cash equivalents as of December 31, 2009 and September 30, 2010 comprise:~~

~~The components of the Company’s short term investments as of December 31, 2009 and September 30, 2010 are as follows:~~

Accounts receivable were ~~$257,737~~$308,851 and ~~$296,106,~~$311,668, and provision for doubtful receivables were ~~$5,229~~$2,926 and ~~$2,788,~~$3,654, resulting in net accounts receivable balances of ~~$252,508~~$305,925 and ~~$293,318,~~$308,014, as of December 31, ~~2009~~2010 and ~~September 30, 2010,~~March 31, 2011, respectively. In addition, accounts receivable due after one year of ~~$1,174~~$10,454 and ~~$8,947~~$11,051 as of December 31, ~~2009~~2010 and ~~September 30, 2010,~~March 31, 2011, respectively are included under other assets in the Consolidated Balance Sheets.

Accounts receivable from related parties were ~~$117,697~~$131,959 and ~~$130,074,~~$135,647, and provision for doubtful receivables were ~~$1,469~~$688 and ~~$826,~~$925, resulting in net accounts receivable balances of ~~$116,228~~$131,271 and ~~$129,248,~~$134,722, as of December 31, ~~2009~~2010 and ~~September 30, 2010,~~March 31 2011, respectively.

The Company measures certain financial assets and liabilities at fair value on a recurring basis, including derivative instruments, U.S. Treasury bills and notes, and loans held for sale. The fair value measurements of these derivative instruments, U.S. Treasury bills and ~~notes, and~~ loans held for sale were determined using the following inputs as of December 31, ~~2009~~2010 and ~~September 30, 2010:~~March 31, 2011:


	As of December 31, 2009								As of December 31, 2010
	Fair Value Measurements at Reporting Date Using								Fair Value Measurements at Reporting Date Using
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Other Unobservable Inputs				Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Other Unobservable Inputs
	Total		(Level 1)		(Level 2)		(Level 3)		Total		(Level 1)		(Level 2)		(Level 3)
Assets
Derivative Instruments (Note a)	$	30,347	$	—	$	30,347	$	—	$	38,026	$	—	$	38,026	$	—
Loans held for sale (Note a)		552		—		—		552		530		—		—		530
U.S. Treasury bills and notes (Note c)		171,150		171,150		—		—		168,475		168,475		—		—

Total	$	202,049	$	171,150	$	30,347	$	552	$	207,031	$	168,475	$	38,026	$	530

Liabilities
Derivative Instruments (Note b)	$	159,965	$	—	$	159,965	$	—	$	64,363	$	—	$	64,363	$	—

Total	$	159,965	$	—	$	159,965	$	—	$	64,363	$	—	$	64,363	$	—


	As of September 30, 2010								As of March 31, 2011
	Fair Value Measurements at Reporting Date Using								Fair Value Measurements at Reporting Date Using
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Other Unobservable Inputs				Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Other Unobservable Inputs
	Total		(Level 1)		(Level 2)		(Level 3)		Total		(Level 1)		(Level 2)		(Level 3)
Assets
Derivative Instruments (Note a)	$	34,281	$	—	$	34,281	$	—	$	45,188	$	—	$	45,188	$	—
Loans held for sale (Note a)		603		—		—		603		529		—		—		529
U.S. Treasury bills and notes (Note c)		126,476		126,476		—		—		134,484		134,484		—		—

Total	$	161,360	$	126,476	$	34,281	$	603	$	180,201	$	134,484	$	45,188	$	529

Liabilities
Derivative Instruments (Note b)	$	93,501	$	—	$	93,501	$	—	$	46,244	$	—	$	46,244	$	—

Total	$	93,501	$	—	$	93,501	$	—	$	46,244	$	—	$	46,244	$	—

Following is the reconciliation of loans held for sale which have been measured at fair value using significant ~~other~~ unobservable inputs:


	Three months ended September 30,						Nine months ended September 30,						Three months ended March 31,
	2009			2010			2009			2010			2010			2011
Opening balance, net	$	759		$	605		$	759		$	552		$	552		$	530
Impact of fair value included in earnings		—			7			—			81			—			—
Settlements		(759	)		(9	)		(759	)		(30	)		(4	)		(1	)

Closing balance, net	$	—		$	603		$	—		$	603		$	548		$	529

The Company values the derivative instruments based on market observable inputs including both forward and spot prices for currencies. The quotes are taken from multiple independent sources including financial institutions. Loans held for sale are valued using collateral values based on inputs from a single source when the Company is not able to corroborate the inputs and assumptions with other relevant market information. Investments in U.S. Treasury bills ~~and notes~~ which are classified as available-for-sale ~~short term investments~~ and cash and cash equivalents, depending on the maturity profile, are measured using quoted market prices at the reporting date multiplied by the quantity held.

The Company is exposed to the risk of rate fluctuations on foreign currency assets and liabilities, and foreign currency denominated forecasted cash flows. The Company has established risk management policies, including the use of derivative financial instruments to hedge foreign currency assets and liabilities, and foreign currency denominated forecasted cash flows. These derivative financial instruments are largely deliverable and non-deliverable forward foreign exchange contracts. The Company enters into these contracts with counterparties which are banks / financial institutions and the Company considers the risks of non-performance by the counterparties as ~~non-material.~~not material. The forward foreign exchange contracts mature between zero and ~~forty-two~~forty-eight months and the forecasted transactions are expected to occur during the same period.

The following table presents the aggregate notional principal amounts of the outstanding derivative financial instruments together with the related balance sheet exposure:


	Notional principal amounts (Note a)				Balance sheet exposure asset (liability) (Note b)						Notional principal amounts (Note a)				Balance sheet exposure asset (liability) (Note b)
	As of December 31, 2009		As of September 30, 2010		As of December 31, 2009			As of September 30, 2010			As of December 31, 2010		As of March 31, 2011		As of December 31, 2010			As of March 31, 2011
Foreign exchange forward contracts denominated in:
United States Dollars (sell) Indian Rupees (buy)	$	2,215,000	$	2,012,813	$	(115,883	)	$	(50,178	)	$	1,937,497	$	1,898,400	$	(19,405	)	$	5,874
United States Dollars (sell) Mexican Peso (buy)		15,400		14,000		599			769			14,400		12,000		510			926
United States Dollars (sell) Philippines Peso (buy)		20,550		60,350		577			1,420			51,950		47,150		2,210			2,308
Euro (sell) United States Dollars (buy)		44,329		54,119		(42	)		1,048			61,426		68,212		953			(2,663	)
Euro (sell) Hungarian Forints (buy)		9,095		15,223		108			385			13,408		15,643		341			1,104
Euro (sell) Romanian Leu (buy)		63,637		58,992		(7,781	)		(866	)		55,392		58,177		591			3,288
Japanese Yen (sell) Chinese Renminbi (buy)		62,483		76,307		(4,985	)		(8,335	)		66,970		67,945		(6,930	)		(4,630	)
Pound Sterling (sell) United States Dollars (buy)		51,149		46,011		406			826			71,463		79,447		1,680			(469	)
Australian Dollars (sell) United States Dollars (buy)		26,461		31,987		(2,617	)		(4,289	)		58,577		61,850		(6,287	)		(6,794	)

					$	(129,618	)	$	(59,220	)					$	(26,337	)	$	(1,056	)

~~The~~ FASB guidance on Derivatives and Hedging requires companies to recognize all derivative instruments as either assets or liabilities at fair value in the statement of financial position. In accordance with the FASB guidance on Derivatives and Hedging, the Company designates foreign exchange forward contracts as cash flow hedges offor forecasted revenues and ~~purchase~~the purchases of ~~services.~~service. In addition to this program the Company also has derivative instruments that are not ~~designated~~accounted for as hedges under the FASB guidance to hedge the ~~fluctuations in~~ foreign exchange ~~rates for recognized~~risks related to balance sheet items such as receivables and inter-company ~~borrowings.~~borrowings denominated in currencies other than the underlying functional currency.

The fair value of the derivative instruments and their location onin the financial statements of the Company is summarized in the table below:


	Cash flow				Non-designated				Cash flow				Non-designated
	As of December 31, 2009		As of September 30, 2010		As of December 31, 2009		As of September 30, 2010		As of December 31, 2010		As of March 31, 2011		As of December 31, 2010		As of March 31, 2011
Assets
Prepaid expenses and other current assets	$	4,133	$	7,022	$	3,502	$	6,613	$	10,186	$	22,967	$	1,202	$	2,541
Other assets	$	22,712	$	20,646	$	—	$	—	$	26,638	$	19,680	$	—	$	—
Liabilities
Accrued expenses and other current liabilities	$	97,696	$	63,092	$	2,175	$	989	$	44,577	$	23,601	$	58	$	2,207
Other liabilities	$	60,094	$	29,420	$	—	$	—	$	19,728	$	20,436	$	—	$	—

For derivative instruments that are designated and qualify as a cash flow hedge, the effective portion of the gain (loss) on the derivative instrument is reported as a component of accumulated other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the hedged transaction ~~affects earnings.~~is recognized in the consolidated statements of income. Gains (losses) on the derivatives representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in ~~earnings.~~earnings as incurred.

In connection with cash flow hedges, the Company has recorded as a component of accumulated other comprehensive income (loss) or OCI within equity a gain (loss) of ($~~87,001)~~18,235), and ~~($43,236),~~$62, net of taxes, as of December 31, ~~2009~~2010 and ~~September 30, 2010,~~March 31, 2011, respectively.

The gains / losses recognized in accumulated other comprehensive income (loss), and their effect on financial performance is summarized below:


Derivatives in Cash Flow Hedging Relationships	Amount of Gain (Loss) recognized in OCI on Derivatives (Effective Portion)				Location of Gain (Loss) reclassified from accumulated OCI into Statement of Income (Effective Portion)		Amount of Gain (Loss) reclassified from Accumulated OCI into Statement of Income (Effective Portion)																Location of Gain (Loss) recognized in Income on Derivatives (Ineffective Portion and Amount excluded from Effectiveness Testing)		Amount of Gain (Loss) recognized in income on Derivative (Ineffective Portion and Amount excluded from Effectiveness Testing)																Amount of Gain (Loss) recognized in OCI on Derivatives (Effective Portion)							Location of Gain (Loss) reclassified from accumulated OCI into Statement of Income (Effective Portion)		Amount of Gain (Loss) reclassified from Accumulated OCI into Statement of Income (Effective Portion)								Location of Gain (Loss) recognized in Income on Derivatives (Ineffective Portion and Amount excluded from Effectiveness Testing)		Amount of Gain (Loss) recognized in income on Derivative (Ineffective Portion and Amount excluded from Effectiveness Testing)
Derivatives in Cash Flow Hedging Relationships	Nine months ended September 30,					Three months ended September 30,								Nine month ended September 30,										Three months ended September 30,								Nine months ended September 30,								Three months ended March 31,									Three months ended March 31,										Three months ended March 31,
	2009		2010			2009				2010				2009				2010						2009				2010				2009				2010				2010				2011					2010				2011						2010				2011
Forward foreign exchange contracts	$	86,044	$	10,466		Revenue		$	(2,729	)		$	(1,142	)		$	(3,274	)		$	(3,183	)		Foreign exchange (gains) losses, net		$	—			$	—			$	—			$	—			$	64,189			$	10,060		Revenue		$	(1,627	)		$	(1,452	)		Foreign exchange (gains) losses, net		$	—			$	—
						Cost of revenue			(11,589	)			(15,285	)			(36,759	)			(42,049	)																											Cost of revenue			(12,944	)			(12,302	)
					Selling, general and administrative expenses			(3,132	)			(3,286	)			(9,432	)			(10,403	)																											Selling, general and administrative expenses			(3,643	)			(2,278	)

	$	86,044	$	10,466			$	(17,450	)		$	(19,713	)		$	(49,465	)		$	(55,635	)				$	—			$	—			$	—			$	—			$	64,189			$	10,060				$	(18,214	)		$	(16,032	)				$	—			$	—


	As of December 31, 2009			As of September 30, 2010			As of December 31, 2010			As of March 31, 2011
Property, plant and equipment, gross	$	381,250		$	429,629		$	440,570		$	446,136
Less: Accumulated depreciation and amortization		(192,138	)		(229,490	)		(243,404	)		(258,506	)

Property, plant and equipment, net	$	189,112		$	200,139		$	197,166		$	187,630

Depreciation expense on property, plant and equipment for the ~~nine months ended September 30, 2009 and 2010 was $33,201 and $37,014 respectively, and for the~~ three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010~~2011 was ~~$11,677~~$11,928 and ~~$12,445~~$11,773, respectively. The amount of computer software amortization for the ~~nine months ended September 30, 2009 and 2010 was $9,095 and $10,043, respectively, and for the~~ three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010~~2011 was ~~$3,054~~$3,317 and ~~$3,300,~~$3,192, respectively.

The above depreciation and amortization expense includes the effect of reclassification of foreign exchange (gains) losses related to the effective portion of the foreign currency derivative contracts amounting to ~~$3,403~~$1,258 and ~~$3,929 for the nine months ended September 30, 2009 and 2010, respectively, and $1,130 and $1,377~~$962 for the three months ended ~~September 30, 2009~~March 31, 2010 and 2011, respectively.

The following table presents the changes in goodwill for the year ended December 31, 2010 and three months ended March 31, 2011:

The total amount of goodwill deductible for tax purposes is $10,474 and $10,247 as of December 31, 2010 and March 31, 2011, respectively.

The Company’s intangible assets acquired either individually or with a group of other assets or in a business combination are as follows:

~~The following table presents the changes in goodwill for the year ended December 31, 2009 and nine months ended September 30, 2010:~~

~~The total amount of goodwill deductible for tax purposes is $13,805 and $10,636 as of December 31, 2009 and September 30, 2010, respectively.~~

~~The Company’s intangible assets acquired either individually or with a group of other assets or in a business combination are as follows:~~

Amortization expenses for intangible assets as disclosed in the consolidated statements of income under amortization of acquired intangible assets for the ~~nine months ended September 30, 2009 and 2010 were $19,747 and $12,159, respectively, and for the~~ three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010~~2011 were ~~$6,382~~$4,219 and ~~$3,875,~~$3,077, respectively. Intangible assets recorded for the 2004 Reorganization include the incremental value of the minimum volume commitment from GE, entered into contemporaneously with the 2004 Reorganization, over the value of the pre-existing customer relationship with GE. The amortization of this intangible asset for the ~~nine months ended on September 30, 2009 and 2010 were $435 and $241, respectively, and for the~~ three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010 were $140~~2011 was $84 and ~~$76,~~$42, respectively, and has been reported as a reduction of revenue. As of ~~September 30, 2010,~~March 31, 2011, the unamortized value of the intangible asset was ~~$308~~$195, which will be amortized in future periods and reported as a reduction of revenue.

The Company has employee benefit plans in the form of certain statutory and other schemes covering its employees.

In accordance with Indian law, the Company provides a defined benefit retirement plan (the “Gratuity Plan”) covering substantially all of its Indian employees. In addition, in accordance with Mexican law, the Company provides termination benefits (the “Mexican Plan”) to all of its Mexican employees.

Net ~~Gratuity Plan~~defined benefit plan costs for the three months ended March 31, 2010 and ~~nine months ended September 30 2009, and 2010~~2011 include the following components:


	Three months ended September 30,						Nine months ended September 30,						Three months ended March 31,
	2009			2010			2009			2010			2010			2011
Service costs	$	473		$	596		$	1,406		$	1,808		$	601		$	693
Interest costs		195			234			580			710			236			334
Amortization of actuarial loss		105			87			312			264			88			137
Expected return on plan assets		(143	)		(196	)		(421	)		(593	)		(197	)		(170	)

Net Gratuity Plan costs	$	630		$	721		$	1,877		$	2,189		$	728		$	994

During the three months ended March 31, 2010 and ~~nine months ended September 30, 2009 and 2010,~~2011, the Company contributed the following amounts to defined contribution plans in various jurisdictions:


	Three months ended September 30,				Nine months ended September 30,				Three months ended March 31,
	2009		2010		2009		2010		2010		2011
India	$	2,051	$	2,632	$	5,917	$	7,522	$	2,311	$	3,320
U.S.		193		361		800		1,191		407		658
U.K.		137		193		397		627		206		207
Hungary		16		16		45		32		9		13
China		1,676		2,130		4,885		5,810		1,807		2,173
Mexico		9		11		48		37		12		11
South Africa		21		81		21		252		97		27
Morocco		—		24		—		85		31		36

Total	$	4,103	$	5,448	$	12,113	$	15,556	$	4,880	$	6,445

The Company has issued options under the Genpact Global Holdings 2005 Plan (the “2005 Plan”), Genpact Global Holdings 2006 Plan (the “2006 Plan”), Genpact Global Holdings 2007 Plan (the “2007 Plan”) and Genpact Limited 2007 Omnibus Incentive Compensation Plan (the “2007 Omnibus Plan”) to eligible persons who are employees, directors and certain other persons associated with the Company.

From the date of adoption of the 2007 Omnibus Plan on July 13, 2007, the options forfeited, expired, terminated, or cancelled under any of the plans will be added to the number of shares otherwise available for grant under the 2007 Omnibus Plan.

The share-based compensation costs relating to ~~the~~ above plans during the ~~nine months ended September 30, 2009 and 2010, were $15,256 and $14,912, respectively, and for the~~ three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010,~~2011, were ~~$5,825~~$4,471 and ~~$4,661,~~$3,047, respectively, have been allocated to cost of revenue and selling, general, and administrative expenses.

There are no significant changes to the assumptions used to estimate the fair value of options granted during the ~~nine~~three months ended ~~September 30, 2010.~~March 31, 2011.

A summary of the options granted during the ~~nine~~three months ended ~~September 30, 2010~~March 31, 2011 is set out below:


	Nine months ended September 30, 2010									Three months ended March 31, 2011
	Shares arising out of options			Weighted average exercise price		Weighted average remaining contractual life (years)		Aggregate intrinsic value		Shares arising out of options			Weighted average exercise price		Weighted average remaining contractual life (years)		Aggregate intrinsic value
Outstanding as of January 1, 2010		20,393,499		$	10.23		7.2	$	—
Outstanding as of January 1, 2011											15,989,356		$	10.84		6.4	$	—
Granted		1,513,000			15.91		—		—		—			—		—		—
Forfeited		(2,111,876	)		13.91		—		—		(523,650	)		15.10		—		—
Expired		(66,436	)		15.22		—		—		(4,000	)		15.18		—		—
Exercised		(2,795,669	)		6.45		—		31,539		(75,491	)		8.29		—		472

Outstanding as of September 30, 2010		16,932,518		$	10.88		6.7	$	116,022
Outstanding as of March 31, 2011											15,386,215		$	10.71		6.2	$	68,664

Vested and exercisable as of September 30, 2010 and expected to vest thereafter (Note a)		16,540,956		$	10.98		6.7	$	111,606
Vested and exercisable as of September 30, 2010		6,404,899		$	6.12		5.4	$	74,339
Vested and exercisable as of March 31, 2011 and expected to vest thereafter (Note a)											14,507,279		$	10.76		6.2	$	64,166
Vested and exercisable as of March 31, 2011											8,462,911		$	8.38		5.4	$	55,579
Weighted average grant date fair value of grants during the period	$	6.66								$	—

Effective April 1, 2007, an amendment was made to the Indian Income Tax Act to subject specified securities allotted or transferred by an employer to its employees resident in India to fringe benefit tax, or FBT. When an employee covered under the Indian Income Tax Act exercises a stock option, the shares issued, or allocated and transferred, by the Company to such employee are subject to FBT. The employer liability for FBT arises and is expensed by the Company at the time of such employee’s exercise of the stock option.

On August 18, 2009, a further amendment was made to the Indian Income Tax Act, with retroactive effect from April 1, 2009, abolishing the provisions of FBT. Thus any exercises of stock options by the employee on or after April 1, 2009, the shares issued, or allocated and transferred by the Company, would no longer be subject to FBT.

During the period when FBT was applicable, the Company was entitled to and the Company’s plans allowed for the collection of the FBT payable from the employee in connection with and at the time of the stock option exercise. The FBT recovered from the employee was treated as an increase in the exercise price. The weighted average grant date fair value of stock options granted during the period when FBT was applicable, reflected an exercise price that included the recovered tax. The FBT recovery by the Company from an employee was recorded as additional paid-in capital in the Consolidated Statements of Equity and Comprehensive Income (Loss).

In connection with the acquisition of Axis Risk Consulting Services Private Limited in 2007, 143,453 common shares were issued to selling shareholders. Of the common shares that were issued, 94,610 common shares were issued to selling shareholders who became employees of the Company and are subject to restrictions on transfer linked to continued employment with the Company for a specified period. The Company has accounted for such shares as compensation for services.

A summary of such shares granted that are subject to restrictions and accounted for as compensation for services, or restricted shares, during the ~~nine~~three months ended ~~September 30, 2010~~March 31, 2011 is set out below:

As of September 30, 2010, the total remaining unrecognized share-based compensation costs related to Restricted Shares amounted to $61 which will be recognized over the weighted average remaining requisite vesting period of 6 months.

The Company ~~grants stock awards in the form of~~granted restricted share units, or RSUs, under the 2007 Omnibus Plan.

Each RSU represents the right to receive one common share. The fair value of each RSU is the market price of one common share of the Company on the date of grant. The RSUs granted to date have vesting schedules of one to four years and a contractual period of ten years. The compensation expense is recognized on a straight line ~~basis~~ over the vesting term.

A summary of RSUs ~~activity~~granted during the ~~nine~~three months ended ~~September 30, 2010~~March 31, 2011 is set out below:

As of ~~September 30, 2010,~~March 31, 2011, the total remaining unrecognized share-based compensation costs related to RSUs amounted to ~~$3,374~~$7,815 which will be recognized over the weighted average remaining requisite vesting period of ~~2.14~~3.30 years.

The Company also makes stock awards in the form of Performance Units, or PUs, under the 2007 Omnibus Plan.

~~During the nine months ended September 30, 2010, the~~The Company granted PUs, wherein each PU represents the right to receive a common share based on the Company’s performance against specified targets. ~~These~~ PUs granted to date have vesting schedules of six months to three years. The fair value of each PU is the market price of one common share of the Company on the date of grant, and assumes that performance targets will be achieved. The PUs granted under the plan are subject to cliff or graded vesting. For awards with cliff vesting, the compensation expense is recognized on a straight line basis over the vesting ~~term.~~term and for the awards with graded vesting, compensation expenses is recognized over the vesting term of each separately vesting portion. Over the performance period, the number of shares that will be issued will be adjusted upward or downward based upon the probability of achievement of the performance targets. The ultimate number of shares issued and the related compensation cost recognized as expense will be based on a comparison of the final performance metrics to the specified targets.

A summary of PU activity during the three months ended March 31, 2011 is set out below:

As of March 31, 2011, the total remaining unrecognized share-based compensation costs related to PUs amounted to $21,658 which will be recognized over the weighted average remaining requisite vesting period of 2.17 years.

In the first quarter of 2011, the compensation committee of the board of directors of the Company modified the performance metrics for the performance grants made to employees in March 2010 from revenue and EBITDA growth to revenue and adjusted operating income growth.

For the performance grant made to the CEO in August 2010, in addition to the modification made to the performance metrics from revenue and EBITDA growth to revenue and adjusted operating income growth, because the CEO’s award vests based on annual performance targets whereas the awards to the employees vest based on average performance over three years, revision has been made to the performance targets in order to make the performance targets consistent with performance grants made to employees in the first quarter of 2011.

~~A summary~~As a result of ~~PUs activity during~~ the ~~nine~~above mentioned modifications, 45 employees were affected and incremental compensation cost of $4.1 million is to be recognized over a period of 21.5 months ~~ended September 30, 2010 is set out below:~~

Asstarting from March 2011 to December 31, 2012. Out of ~~September 30, 2010,~~ the total ~~remaining unrecognized share-based~~incremental compensation ~~costs related~~cost, $2.9 million and $1.2 million is to ~~PUs amounted to $11,222 which will~~ be recognized over the ~~weighted average remaining requisite vesting period of 2.33 years.~~years 2011 and 2012 respectively.

On May 1, 2008, the Company adopted the Genpact Limited U.S. Employee Stock Purchase Plan and the Genpact Limited International Employee Stock Purchase Plan (together, the “ESPP”).

The ESPP allowed eligible employees to purchase the Company’s common shares through payroll deduction at 95% of the fair value per share on the last business day of each purchase interval ending on or prior to August 31, 2009. The purchase price has been reduced to 90% of the fair value per share on the last business day of each purchase interval commencing with effect from September 1, 2009. The dollar amount of common shares purchased under the ESPP shall not exceed the greater of 15% of the participating employee’s base salary or $25 per calendar year. With effect from September 1, 2009, the offering periods commence on the first business day in March, June, September and December of each year and end on the last business day in the subsequent May, August, November and February of each year. 4,200,000 common shares have been reserved for issuance in the aggregate over the term of the ESPP.

During the ~~nine~~three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010,~~2011, common shares issued under ~~the~~ ESPP were ~~31,327~~10,427 and ~~32,389,~~12,224, respectively.

The ESPP was considered as non compensatory under the FASB guidance on Compensation-Stock Compensation until the purchase interval ending on or prior to August 31, 2009. As a result of the change in the discount rate, the ESPP is being considered compensatory with effect from September 1, 2009.

The compensation expenses for the ~~ESPP are~~employee stock purchase plan is recognized in accordance with the FASB guidance on Compensation-Stock Compensation. ~~During~~The compensation expense for ESPP during the ~~nine months and~~ three months ended ~~September 30,~~March 31, 2010 ~~$51~~ and ~~$17,~~2011 were $15 and $18, respectively, ~~has been recognized as compensation expense,~~ and has been allocated to cost of revenue and selling, general, and administrative expenses.

The Company calculates earnings per share in accordance with FASB guidance on Earnings per ~~Share.~~share. Basic and diluted earnings per common share give effect to the change in the number of common shares of the Company. The calculation of earnings per common share was determined by dividing net income available to common shareholders by the weighted average number of common shares outstanding during the respective periods. The potentially dilutive shares, consisting of outstanding options on common shares, restricted share units, common shares to be issued under employee stock purchase plan and performance units have been included in the computation of diluted net earnings per share and the weighted average shares outstanding, except where the result would be anti-dilutive.

The number of stock options outstanding but not included in the computation of diluted earnings per common share because their effect was anti-dilutive is ~~13,425,367~~10,382,214 and ~~9,585,407 for the nine months ended September 30, 2009 and 2010, respectively, and is 10,438,965 and 8,752,810~~7,779,564 for the three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010,~~2011, respectively.


	Three months ended September 30,				Nine months ended September 30,				Three months ended March 31,
	2009		2010		2009		2010		2010		2011
Net income attributable to Genpact Limited common shareholders	$	33,062	$	40,131	$	92,712	$	96,152	$	28,174	$	36,119
Weighted average number of common shares used in computing basic earnings per common share		215,794,607		219,630,410		215,136,984		218,847,260		217,956,146		221,008,760

Dilutive effect of share based awards		6,004,990		5,200,840		4,091,890		5,736,234		6,015,913		4,534,530

Weighted average number of common shares used in computing dilutive earnings per common share		221,799,597		224,831,250		219,228,874		224,583,494		223,972,059		225,543,290

Earnings per common share attributable to Genpact Limited common shareholders
Basic	$	0.15	$	0.18	$	0.43	$	0.44	$	0.13	$	0.16
Diluted	$	0.15	$	0.18	$	0.42	$	0.43	$	0.13	$	0.16


	Three months ended September 30,				Nine months ended September 30,				Three months ended March 31,
	2009		2010		2009		2010		2010		2011
Personnel expenses	$	103,935	$	129,219	$	303,046	$	365,530	$	114,971	$	143,741
Operational expenses		50,980		62,068		158,806		167,897		49,386		57,560
Depreciation and amortization		12,080		13,546		34,664		39,192		12,328		13,186

	$	166,995	$	204,833	$	496,516	$	572,619	$	176,685	$	214,487


	Three months ended September 30,				Nine months ended September 30,				Three months ended March 31,
	2009		2010		2009		2010		2010		2011
Personnel expenses	$	45,356	$	51,263	$	131,900	$	155,206	$	51,319	$	47,520
Operational expenses		19,235		17,811		55,433		56,369		18,656		18,142
Depreciation and amortization		2,651		2,198		7,632		7,865		2,916		1,779

	$	67,242	$	71,272	$	194,965	$	219,440	$	72,891	$	67,441


	Three months ended September 30,						Nine months ended September 30,						Three months ended March 31,
	2009			2010			2009			2010			2010			2011
Interest income	$	1,188		$	1,127		$	5,891		$	3,171		$	1,342		$	3,558
Interest expense		(725	)		(629	)		(3073	)		(1734	)		(575	)		(666	)
Secondary offering expenses		—			—			—			(591	)		(591	)		—
Other income (expense)		(158	)		712			630			2478
Other income														1,094			205

Other income (expense), net													$	1,270		$	3,097
	$	305		$	1,210		$	3,448		$	3,324

As a result of the change in tax status of one of its subsidiaries in the U.S. during the year ended December 31, 2007, the Company recognized the tax effects in the consolidated statement of income for the adjustment in deferred tax liability associated with the unrealized gains on certain effective hedges in other comprehensive income. During the nine months ended September 30, 2010, the Company recognized a reversal of deferred tax liability amounting to $658 for these hedges that matured in nine months ended on September 30, 2010.

As of December 31, ~~2009,~~2010, the Company had unrecognized tax benefits amounting to ~~$13,195~~$20,016 including an amount of ~~$13,019~~$19,860 that, if recognized would impact the effective tax rate.

The following table summarizes the activities related to our unrecognized tax benefits for uncertain tax positions from January 1, ~~2010~~2011 to ~~September 30, 2010:~~March 31, 2011:

The unrecognized tax benefits as of ~~September 30, 2010~~March 31, 2011 include an amount of ~~$17,590~~$19,842 that, if recognized, would impact the effective tax rate. As of December 31, ~~2009~~2010 and ~~September 30, 2010,~~March 31, 2011, the Company has accrued approximately ~~$1,930~~$2,020 and ~~$1,959,~~$2,040, respectively, in interest relating to unrecognized tax benefits.

The Company has entered into related party transactions with GE and companies in which GE has a majority ownership interest or on which it exercises significant influence (collectively referred to as “GE” herein). The Company has also entered into related party transactions with its non-consolidating affiliates, ~~and~~ a customer in which one of the Company’s directors has a controlling ~~interest.~~interest and a customer which has significant interest in the Company.

Prior to December 31, 2004, substantially all of the revenues of the Company were derived from services provided to GE entities. In connection with the 2004 Reorganization, GE entered into a Master Service Agreement, or MSA, with the Company. The GE MSA, as amended, provides that GE will purchase services in an amount not less than a minimum volume commitment, or MVC, of $360,000 per year for seven years beginning January 1, 2005, $270,000 in 2012, $180,000 in 2013 and $90,000 in 2014. Revenues in excess of the MVC can be credited, subject to certain limitations, against shortfalls in the subsequent years.

On January 26, 2010, the Company extended its MSA, with GE by two years, through the end of 2016, including the minimum annual volume commitment of $360,000. The MSA also provides that the minimum annual volume commitment for each of the years 2014, 2015 and 2016 is $250,000, $150,000 and $90,000, respectively.

For the ~~nine~~three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010,~~2011, the Company recognized net revenues from GE of ~~$333,909~~$113,338 and ~~$353,791,~~$112,781, respectively, representing ~~41%~~39% and ~~39%~~34%, respectively, of the consolidated total net revenues.

For the three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010, the Company recognized net revenues from GE of $111,459 and $122,673, respectively, representing 39% and 38%, respectively, of the consolidated total net revenues.~~

~~For the three months and nine months ended September 30, 2010,~~2011, the Company recognized net revenues of ~~$86~~$0 and ~~$220,~~$77, respectively, from a customer in which one of the Company’s directors has a controlling ~~interest.~~

Company recognized net revenue of $0 and $103, respectively, from a customer which has significant interest in the Company.

The Company purchases certain services from GE mainly relating to communication and leased assets, which are included as part of operational expenses included in cost of revenue. For the ~~nine~~three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010,~~2011, cost of revenue, net of recovery, included amounts of ~~$4,334~~$1,286 and ~~$3,542, respectively, and for the three months ended September 30, 2009 and 2010, cost of revenue, net of recovery, included amounts of $1,571 and $960,~~$1,311, respectively, relating to services procured from GE. ~~In addition, cost of revenue also includes a credit adjustment of $3,499 due to re-negotiation of certain service contracts. For the nine months ended September 30, 2009 and 2010, cost~~Cost of revenue from services also include training & recruitment cost of ~~$474~~$343 and ~~$897 respectively, and $113 and $318~~$233 for the three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010,~~2011, respectively, from its non-consolidating affiliates.

The Company purchases certain services from GE mainly relating to communication and leased assets, which are included as part of operational expenses included in selling, general and administrative expenses. For the ~~nine~~three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010,~~2011, selling, general and administrative expenses, net of recovery, included amounts of ~~$314~~$202 and ~~$420, respectively, and for the three months ended September 30, 2009 and 2010, selling, general and administrative expenses, net of recovery, included amounts of $117 and $107,~~$182, respectively, relating to services procured from GE. For the ~~nine~~three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010,~~2011, selling, general, and administrative expenses ~~also~~ include atraining and recruitment cost and cost recovery, net, of ~~$586~~$221 and ~~$397, respectively, and for the three months ended September 30, 2009 and 2010, selling, general, and administrative expenses also include a cost recovery, net, of $159 and $97,~~($18), respectively, in relation to cost recovery from its non-consolidating affiliates.

The Company provides certain shared services such as facility, recruitment, training, and communication to GE. Recovery for such services has been included as other operating income in the consolidated statements of income. For the ~~nine~~three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010,~~2011, income from these services was ($~~3,368)~~785) and ($~~1,867), respectively, and for the three months ended September 30, 2009 and 2010, income from these services was ($935) and ($626)~~513), respectively.

The Company earned interest income on short-term deposits placed with GE. For the ~~nine~~three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010,~~2011, interest income earned on these deposits was ~~$1,845 and $118, respectively, and for the three months ended September 30, 2009 and 2010, interest income earned on these deposits was $236~~$94 and $0, respectively.

The Company incurred interest expense on finance lease obligations and external commercial borrowings from GE. For the ~~nine~~three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010,~~2011, interest expense relating to such related party debt amounted to ~~$318~~$112 and ~~$265, respectively, and for the three months ended September 30, 2009 and 2010, interest expense relating to such related party debt amounted to $106 and $123,~~$102, respectively.

During the ~~nine~~three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010,~~2011, the Company has made an investment of ~~$296 and $2,324, respectively, in its non-consolidating affiliates and for the three months ended September 30, 2009 and 2010, the Company has made an investment of $0~~$2,000 and $0, respectively, in its non-consolidating affiliates.

As of December 31, ~~2009~~2010 and ~~September 30, 2010,~~March 31, 2011, the Company has ~~commitment~~committed to spend ~~$33,493~~$3,041 and ~~$7,238~~$3,327, respectively, under agreements to purchase property, plant and equipment. This amount is net of capital advances paid in respect of these purchases.

The Company has outstanding ~~bank~~Bank guarantees including letter of credits amounting to ~~$1,242~~$12,745 and ~~$2,007~~$10,525 as of December 31, ~~2009~~2010 and ~~September 30, 2010,~~March 31, 2011, respectively. Bank guarantees are generally provided to government agencies, excise and customs authorities for the purposes of maintaining a bonded warehouse. These guarantees may be revoked by the governmental agencies if they suffer any losses or damage through the breach of any of the covenants contained in the agreements.

The Company’s business process Delivery Centers in India are 100% Export Oriented units or Software Technology Parks of India units (“STPI”) ~~units~~ under the STPI guidelines issued by the Government of ~~India or are under qualifying operations of the Special Economic Zones Act, 2005.~~India. These units are exempted from customs, central excise duties, and levies on imported and indigenous capital goods, stores, and spares. The Company has executed legal undertakings to pay custom duty, central excise duty, levies, and liquidated damages payable, if any, in respect of imported and indigenous capital goods, stores, and spares consumed duty free, in the event that certain terms and conditions are not fulfilled.

On April 5, 2011, the Company entered into a material definitive agreement to acquire Headstrong Corporation, a Delaware corporation (“Headstrong”) for cash consideration of $550,000, subject to adjustment based on net working capital. Headstrong is a global provider of comprehensive consulting and IT services with a specialized focus in capital markets and healthcare.

On May 3, 2011, the acquisition of Headstrong was consummated. The Company funded the consideration with the combination of existing cash and cash equivalents and borrowings under new senior secured credit facilities aggregating $380,000. The Credit Agreement provides for a $120.0 million term credit facility and a $260.0 million revolving credit facility. The Company has an option to increase the commitment under the Credit Agreement by up to an additional $100.0 million, subject to certain approvals and conditions as set forth in the Credit Agreement.

Borrowings under the Credit Agreement will be used (i) to finance in part the acquisition of Headstrong, including related transaction costs, and (ii) for general corporate purposes of the Company and its subsidiaries, including working capital requirements. The Credit Agreement replaces the Company’s existing credit facility and has a term of four years.

Borrowings under the Credit Agreement bear interest at a rate equal to LIBOR plus an applicable margin equal to 1.65% per annum. The revolving credit commitments under the Credit Agreement are subject to a commitment fee equal to 0.70% on the actual daily amount by which the aggregate revolving commitments exceed the sum of outstanding revolving and swing line loans and letter of credit obligations.

The Credit Agreement contains customary affirmative and negative covenants, including, but not limited to, restrictions on the ability to incur additional indebtedness, create liens, make certain investments, make certain dividends and related distributions, enter into, or undertake, certain liquidations, mergers, consolidations or acquisitions and dispose of assets or subsidiaries. In addition, the Credit Agreement requires the Company to maintain a certain consolidated interest coverage ratio and a consolidated leverage ratio.

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion in conjunction with our Consolidated Financial Statements and related Notes included elsewhere in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, ~~2009~~2010 and with the information under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, ~~2009.~~2010. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those discussed in or implied by any of the forward-looking statements as a result of various factors, including but not limited to those listed below and under “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, ~~2009.~~2010.

We have made statements in this Quarterly Report on Form 10-Q (the “Quarterly Report”) in, among other sections, this Part 1 Item 2-”“Management’s Discussion and Analysis of Financial Condition and Results of Operations”, that are forward-looking statements. In some cases, you can identify these statements by forward-looking terms such as “expect”, “anticipate”, “intend”, “plan”, “believe”, “seek”, “estimate”, “could”, “may”, “shall”, “will”, “would” and variations of such words and similar expressions, or the negative of such words or similar expressions. These forward-looking statements, which are subject to risks, uncertainties and assumptions about us, may include projections of our future financial performance, which in some cases may be based on our growth strategies and anticipated trends in our business. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from those expressed or implied by the forward-looking statements. In particular, you should consider the numerous risks outlined in Part I, Item 1A-”“Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, ~~2009.~~2010. These forward-looking statements include, but are not limited to, statements relating to:

Factors that may cause actual results to differ from expected results include, among others:

Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Achievement of future results is subject to risks, uncertainties and potentially inaccurate assumptions. Should known or unknown risks or uncertainties materialize, or should underlying assumptions prove inaccurate, actual results could differ materially from past results and those anticipated, estimated or projected. You should bear this in mind as you consider forward-looking statements. We are under no obligation to update any of these forward-looking statements after the date of this filing to conform our prior statements to actual results or revised expectations. You are advised, however, to consult any further disclosures we make on related subjects in our Form 10-K, Form 10-Q and Form 8-K reports ~~filed with~~to the SEC.

We are a global leader in ~~managing~~ business ~~processes,~~process and technology management, offering a broad portfolio of enterprise and industry-specific services. We manage over 3,000 processes for more than 400 clients worldwide. Putting process in the forefront, we couple our deep process knowledge and insights with focused information technology capabilities, targeted analytics and pragmatic reengineering to deliver comprehensive solutions for clients. Lean and Six Sigma are an integral part of our culture and we view the management of business processes as a science. We have developed Smart Enterprise Processes (SEP^SM ),), a groundbreaking, rigorously scientific methodology for managing business processes, which focuses on optimizing process effectiveness in addition to efficiency to deliver superior business outcomes. Services are seamlessly delivered from a global network of centers to meet a client’s business objectives, cultural and language needs and cost reduction goals.

We have a unique heritage. We built our business by meeting the demands of the leaders of the General Electric Company, or GE, to increase the productivity of their businesses. We began in 1997 as the India-based captive business process services operation for General Electric Capital Corporation, or GE Capital, GE’s financial services business. As the value of offshoring was demonstrated to the management of GE, it became a widespread practice at GE and our business grew in size and scope. We took on a wide range of complex and critical processes and we became a significant provider to many of GE’s businesses, including Consumer Finance (GE Money), Commercial Finance, Healthcare, Industrial, NBC Universal and GE’s corporate offices.

Our leadership team, our methods and our culture have been deeply influenced by our eight years as a captive operation of GE. Many elements of GE’s success—the rigorous use of metrics and analytics, the relentless focus on improvement, a strong emphasis on the client and innovative human resources practices—are the foundations of our business.

As of ~~September 30, 2010,~~March 31, 2011, we have approximately ~~43,300~~45,500 employees with operations in thirteen countries. In the ~~third~~first quarter of ~~2010,~~2011, we had net revenues of ~~$321.6~~$330.6 million, of which ~~61.9%~~65.9% was from clients other than GE, which we refer to as Global Clients.

Our registered office is located at Canon’s Court, 22 Victoria Street, Hamilton HM, Bermuda.

Prior to December 30, 2004, our business was conducted through various entities and divisions of GE. On December 30, 2004, in a series of transactions we refer to as the “2004 Reorganization,” GE reorganized these operations by placing them all under Genpact Global Holdings SICAR S.à.r.l., or GGH, a newly formed ~~Luxembourg entity.~~company. GE’s affiliate, GE Capital International (Mauritius) also sold an indirect 60% interest in GGH to Genpact Investment Co. (Lux) SICAR S.à.r.l., or GICo, an entity owned in equal portions by General Atlantic LLC, or General Atlantic, and Oak Hill Capital Partners, or Oak Hill. ~~On December 16, 2005, GE’s affiliate~~Since the 2004 Reorganization, GE, through its affiliates, sold a portion of its equity in us to a subsidiary of Wachovia Corporation. Wachovia Corporation merged with Wells Fargo & Company on December 31, 2008. On December 22, 2006, we redeemed certain shares held by GE affiliates. On December 18, 2007, GE’s affiliate, GE Capital (Mauritius) Holdings Ltd., sold a further portion of its equity in us to an affiliate of a limited partner of one of our shareholders. GE further divested its shares pursuant to ~~our secondary offering completed on March 24, 2010.~~several separate transactions. As of ~~September 30, 2010,~~March 31, 2011, GE, through its affiliates, owned ~~9.1%~~9.0% of our outstanding equity.

Following the 2004 Reorganization, we began operating as an independent company. We separated ourselves operationally from GE and began building the capabilities necessary to be successful as an independent company. Among other things, we expanded our management infrastructure and business development capabilities so that we could secure business from clients other than GE. We substantially expanded administrative functions for which we had previously relied primarily on GE, such as finance, legal, accounting and human resources. We set up separate employee benefit and retirement plans, developed our own leadership training capability and enhanced our management information systems.

On March 29, 2007, we formed Genpact Limited in Bermuda to be the new holding company for our business. It was initially a wholly-owned subsidiary of GGH. On July 13, 2007, we effectuated a transaction that resulted in Genpact Limited owning 100% of the capital stock of GGH. This transaction together with other related transactions is referred to as the “2007 Reorganization.”

As part of the 2007 Reorganization, GGH became a Bermuda company and changed its name to Genpact Global Holding (Bermuda) Limited. We use the terms “Genpact”, “Company”, “we” and “us” to refer to both GGH and its subsidiaries prior to July 13, 2007 and Genpact Limited and its subsidiaries after such date.

On August 1, 2007, we commenced an initial public offering of our common shares, pursuant to which we and certain of our existing shareholders each sold 17.65 million common shares at a price of $14 per share. The offering resulted in gross proceeds of $494.1 million and net proceeds to us and the selling shareholders of approximately $233.5 million each after deducting underwriting discounts and commissions. Additionally, we incurred offering-related expenses of approximately $9.0 million. On August 14, 2007, the underwriters exercised their option to purchase 5.29 million additional common shares from us at the initial offering price of $14 per share to cover over-allotments resulting in additional gross proceeds of $74.1 million and net proceeds of approximately $70.0 million to us, after deducting underwriting discounts and commissions.

On March 24, 2010, we completed a secondary offering of our common shares, pursuant to which certain of our shareholders sold 38.64 million common shares at a price of $15 per share, which included the underwriters exercise of their option to purchase an additional 5.04 million common shares from selling shareholders at the offering price of $15 per share to cover over-allotments. All of the common shares were sold by our shareholders and, as a result, we did not receive any of the proceeds from the offering. We incurred offering-related ~~expenses~~costs of approximately $0.6 million ~~included under~~expensed and classified as other income (expense), net in the interim consolidated financial statements. Upon completion of the secondary offering, GE’s shareholding declined to 9.1% and it ceased to be a significant shareholder although it continues to be a related party in accordance with the provisions of Regulation S-X Rule 1-02(s).

From time to time we may make acquisitions or engage in other strategic transactions if suitable opportunities arise, and we may use cash, securities or other assets as consideration.

In January 2010, we acquired 27% of the outstanding equity in High Performance Partners, LLC, or HPP, a company focused on developing and applying innovative technology solutions for the mortgage industry, for cash consideration of $2.0 million. The Company follows the equity method of accounting to account for this investment.

~~In January 2010, we~~ finalized an arrangement with Walgreens, the largest drug store chain in the U.S., to acquire a delivery center in Danville, Illinois ~~and~~for cash consideration of $16.3 million. At the same time, we entered into a ten year master professional ~~services~~service agreement, or MPSA, with ~~Walgreens, for cash consideration of $16.3 million.~~Walgreens. Pursuant to the terms of the MPSA, approximately 500 Walgreens accounting employees in Danville were transferred to Genpact in May 2010. ~~By virtue of the~~

combination of the acquisition of the delivery center and the entry into the MPSA, we have acquired an integrated set of activities and assets capable of being managed and conducted for the purpose of providing returns to us, and this arrangement qualifies as a business combination. This transaction was consummated in the second quarter of 2010 upon completion of certain closing conditions and has been accounted for as a business combination in accordance with the acquisition method.

In February 2010, we acquired Symphony Marketing Solutions, Inc., or Symphony, a leading provider of analytics and data management services with domain expertise in the retail, pharmaceutical and consumer packaged goods industries for cash consideration of $29.3 million and acquired short term liabilities of $5.4 million. The acquisition of Symphony was accounted for as a business combination in accordance with the acquisition method.

In March 2011, we acquired Akritiv Technologies, Inc., or Akritiv, a leading provider of cloud-based order-to-cash (OTC) technology solutions with domain expertise in providing Software As A Service (SAAS) solutions for working capital optimization, for a cash consideration of $1.6 million and a contingent consideration with an estimated fair value of $1.7 million. The acquisition of Akritiv was accounted for as a business combination in accordance with the acquisition method.

In May 2011, we acquired Headstrong Corporation (“Headstrong”), a global provider of comprehensive consulting and IT services with a specialized focus in capital markets and healthcare, for cash consideration of $550 million.

For a description of our critical accounting policies, see Note 2- “Summary of significant accounting policies” under Item 1- ~~“Financial~~“Financial Statements” above and Part-II Item-7- “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates” in our Annual Report on Form 10-K for the year ended December 31, ~~2009.~~2010.

The following table sets forth certain data from our income statement ~~in absolute amounts and as a percentage of net revenues~~ for the three months ended March 31, 2010 and ~~nine months ended September 30, 2009 and 2010.~~2011.


	Three months ended September 30,										Nine months ended September 30,										Three months ended March 31,						% Change Increase/(Decrease)
	2009					2010					2009					2010					2010			2011			2011 Vs. 2010
	(dollars in millions)										(dollars in millions)										(dollars in millions)
Net revenues—GE	$	111.5		39.2	%	$	122.7		38.1	%	$	333.9		40.6	%	$	353.8		38.6	%	$	113.3		$	112.8			(0.5	)%
Net revenues—Global Clients		173.0		60.8	%		198.9		61.9	%		489.2		59.4	%		563.6		61.4	%		174.9			217.8			24.5	%

Total net revenues		284.4		100.0	%		321.6		100.0	%		823.1		100.0	%		917.4		100.0	%		288.2			330.6			14.7	%

Cost of revenue		167.0		58.7	%		204.8		63.7	%		496.5		60.3	%		572.6		62.4	%		176.7			214.5			21.4	%
Gross profit		117.4		41.3	%		116.7		36.3	%		326.6		39.7	%		344.8		37.6	%		111.5			116.1			4.1	%
Gross profit Margin %																						38.7	%		35.1	%
Operating expenses
Selling, general and administrative expenses		67.2		23.6	%		71.3		22.2	%		195.0		23.7	%		219.4		23.9	%		72.9			67.4			(7.5	)%
Amortization of acquired intangible assets		6.4		2.2	%		3.9		1.2	%		19.7		2.4	%		12.2		1.3	%		4.2			3.1			(27.1	)%
Other operating (income) expense, net		(1.1	)	0.4	%		(0.8	)	0.3	%		(4.0	)	0.5	%		(4.8	)	0.5	%		(2.8	)		(1.0	)		(66.2	)%

Income from operations		44.9		15.8	%		42.4		13.2	%		115.9		14.1	%		118.0		12.9	%		37.3			46.5			24.8	%
Income from operations % of Net revenues																						12.9	%		14.1	%
Foreign exchange (gains) losses, net		2.6		0.9	%		(5.5	)	1.7	%		2.0		0.2	%		0.1		0.0	%		0.7			(1.6	)		314.4	%
Other income (expense), net		0.3		0.1	%		1.2		0.4	%		3.4		0.4	%		3.3		0.4	%		1.3			3.1			143.9	%

Income before share of equity in (earnings) loss of affiliates and income tax expense		42.6		15.0	%		49.2		15.3	%		117.3		14.3	%		121.2		13.2	%
Income before share of equity in loss of affiliates and income tax expense																						37.8			51.2			35.4	%
Equity in loss of affiliates		0.2		0.1	%		0.1		0.0			0.6		0.1	%		0.7		0.1	%		0.3			0.1			(60.1	)%

Income before income tax expense		42.5		14.9	%		49.0		15.3	%		116.7		14.2	%		120.5		13.1	%		37.5			51.0			36.2	%
Income tax expense		7.9		2.8	%		7.5		2.3	%		18.4		2.2	%		19.6		2.1	%		7.2			13.1			81.8	%

Net Income		34.6		12.2	%		41.6		12.9	%		98.3		11.9	%		100.9		11.0	%		30.2			37.9			25.4	%
Net income attributable to noncontrolling interest		1.5		0.5	%		1.4		0.4			5.6		0.7	%		4.8		0.5	%		2.1			1.8			(13.3	)%

Net income attributable to Genpact Limited shareholders	$	33.1		11.6	%	$	40.1		12.5	%	$	92.7		11.3	%	$	96.2		10.5	%	$	28.2		$	36.1			28.2	%

Net income available to Genpact Limited common shareholders		33.1					40.1					92.7					96.2
Net income attributable to Genpact Limited shareholders % of Net revenues																						9.8	%		10.9	%

“Net revenues-related party” disclosed in the Consolidated Statements of Income includes revenue earned from GE and its affiliates; a client in which one of our directors has a controlling interest; and a client which has a significant interest in the Company. The revenue earned from these clients is included in “Net revenues-Global Clients” in the table above.

Three Months Ended ~~September 30, 2010~~March 31, 2011 Compared to Three Months Ended ~~September 30, 2009~~March 31, 2010

Net revenues. Our net revenues increased by ~~$37.1~~$42.3 million, or ~~13.1%~~14.7%, in the ~~third~~first quarter of ~~2010~~2011 compared to the ~~third~~first quarter of ~~2009.~~2010. Our growth in net revenues is primarily on account of growth in business process management services for ~~new~~ Global ~~Clients~~Clients. In addition, growth in net revenues was also on account of the strengthening of the Australian dollar and ~~GE.~~the Japanese yen against the U.S. dollar, as a portion of our revenues are received in such currencies. Our ~~total~~average headcount increased by ~~14.9%~~11.9% to approximately ~~43,300 at~~43,100 in the ~~end of the third~~first quarter of ~~2010~~2011 from approximately ~~37,700 at~~38,500 in the ~~end of the third~~first quarter of ~~2009.~~2010. Our revenue per employee ~~was~~increased to approximately ~~$31.6~~$30.7 thousand in the ~~third~~first quarter of ~~2009 which decreased to~~2011 from approximately ~~$31.2~~$29.9 thousand in the ~~third~~first quarter of 2010. ~~The slight~~

Revenues from business process management services increased to 87.2% of total net revenues in the first quarter of 2011 from 85.2% in the first quarter of 2010. Revenues from business process management grew 17.3% to $288.1 million in the first quarter of 2011 from $245.7 million in the first quarter of 2010, led by growth in revenues from Global Clients. Revenue from our information technology business decreased marginally by $0.1 million, or 0.2%, in the first quarter of 2011 compared to the first quarter of 2010, primarily due to information technology revenues generated by Global Clients, adjusted for dispositions by GE in 2010, declining from $20.5 million to $19.2 million as a result of volume and price reductions in our SAP offerings. This decrease in our information technology services revenue ~~per employee is primarily because~~was offset by increased information technology services offerings to GE Corporate and Commercial Finance. As a percentage of net revenues, revenue from our ~~revenue per employee~~information technology business declined to 12.8% in the ~~third~~first quarter of ~~2009 benefited~~2011 from ~~a $4 million receipt from one~~14.8% in the first quarter of ~~our Global Clients for cancellations.~~2010.

Net revenues from GE ~~increased~~decreased marginally by ~~$11.2~~$0.6 million, or ~~10.1%~~0.5%. As described under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Overview — Classification of Certain Net Revenues” in our Annual Report on Form 10-K for the year ended December 31, ~~2009,~~2010, certain businesses in which GE ceased to be a 20% shareholder are classified as GE net revenues for part of the year until the divesture by GE and as Global Clients net revenues after the divesture by GE. GE revenues for the ~~third~~first quarter of ~~2010~~2011 increased ~~10.5%~~by 0.7% over the ~~third~~first quarter of ~~2009~~2010 after excluding such dispositions by GE in ~~2009 and~~ 2010. This increase was primarily driven by growth in information technology ~~and business process management~~ service offerings across GE businesses partially offset by deletions and price reductions in certain statements of work, or SOWs. As a result of the growth in revenues from Global Clients, GE net revenues declined as a percentage of our total net revenues from ~~39.2%~~39.3% in the ~~third~~first quarter of ~~2009~~2010 to ~~38.1%~~34.1% in the ~~third~~first quarter of ~~2010.~~2011.

Net revenues from Global Clients increased by ~~$25.9~~$42.9 million, or ~~15.0%~~24.5% compared to the ~~third~~first quarter of ~~2009.~~2010. $17.7 million, or 41.2%, of the increase in net revenues from Global Clients was from clients in consumer product goods, retail, business services, pharmaceutical and healthcare industries. $13.4 million, or 31.2% of the increase in net revenues from Global Clients was from clients in banking, financial services and insurance industries. $2.7 million, or 6.2%, of the increase was from revenues generated by Symphony Marketing Solutions, Inc. (“Symphony”) acquired in the first quarter of 2010. $8.8 million or 20.5%, of the increase was from revenues from our master service agreement with Walgreens for which service delivery commenced in the second quarter of 2010. The remaining increase was driven by Global Clients in the manufacturing industry. This increase ~~resulted from new business from clients added in the last twelve months, including Walgreens and clients of Symphony, partially offset by~~was after considering a decline in information technology services for Global Clients. A portion of the increase in net revenues from Global Clients was also related to GE ceasing to be a 20% shareholder in certain businesses and the reclassification of related net revenues of ~~$1.2~~$1.3 million as described above. As a percentage of total net revenues, net revenues from Global Clients increased from ~~60.8%~~60.7% in the ~~third quarter of 2009 to 61.9% in the third quarter of 2010.~~

~~Revenues from business process management services increased to 86.3% of total net revenues in the third~~first quarter of 2010 ~~from 84.9%~~to 65.9% in the ~~third~~first quarter of 2009. Revenues from business process management grew 14.9% from the third quarter of 2009 to $277.4 million in the third quarter of 2010. The increase in business process management revenues was primarily due to new business from Global Clients added in the last twelve months, including clients of Symphony. We also saw growth in finance & accounting, analytics and supply chain service offerings for GE. Revenue from our information technology business increased by $1.3 million, or 2.9%, in the third quarter of 2010 compared to the third quarter of 2009. The increase in our information technology services revenue is driven by GE Commercial Finance and Healthcare, partially offset by volume and price reductions in our SAP offerings in Europe. As a percentage of net revenues, revenue from our information technology business declined to 13.7% in the third quarter of 2010 from 15.1% in the third quarter of 2009.2011.

Cost of revenue. The following table sets forth the components of our cost of ~~revenue in absolute amounts and as a percentage of net revenues:~~revenue:


	Three Months Ended September 30,								Three Months Ended March 31,						% Change Increase/(Decrease)
	2009				2010				2010			2011			2011 vs. 2010
	(dollars in millions)								(dollars in millions)
Personnel expenses	$	103.9	36.5	%	$	129.2	40.2	%	$	115.0		$	143.7			25.0	%
Operational expenses		51.0	17.9			62.1	19.3			49.4			57.6			16.6
Depreciation and amortization		12.1	4.2			13.5	4.2			12.3			13.2			7.0

Cost of revenue	$	167.0	58.7	%	$	204.8	63.7	%	$	176.7		$	214.5			21.4	%

Cost of revenue as a % of total net revenues										61.3	%		64.9	%

Cost of revenue increased by $37.8 million, or ~~22.7%~~21.4%. ~~As a percentage of net revenues, cost of revenue increased from 58.7% in the third quarter of 2009 to 63.7% in the third quarter of 2010.~~ This increase in cost of revenue is primarily due to higher personnel and operational expenses on account of increased headcount and infrastructure ~~costs incurred~~costs. The increase also relates to the general growth of

our business, cost of headcount and facilities acquired due to the acquisition of Symphony in ~~anticipation~~the first quarter of ~~transitions for new contracts which were delayed. The~~2010 and another business comprising of facility and staff acquired in Danville, Illinois in the second quarter of 2010.

$8.2 million, or 21.8% of the increase in cost of revenue ~~is also~~relates to acquisitions as mentioned above. $7.7 million, or 20.5% of the increase in cost of revenue relates to higher facility/infrastructure related expenses and communication charges. The remaining increase in cost of revenue was due to an increase in personnel expenses on account of ~~lower realization on our contracted Indian rupee-U.S. dollar hedges~~increased headcount, wage inflation and higher allocation to cost of revenue due to growth in ~~2010~~the number of operations personnel compared to ~~2009.~~a decline in the number of support personnel. As a result, our cost of revenue as a percentage of net revenues increased from 61.3% in the first quarter of 2010 to 64.9% in the first quarter of 2011.

The largest component of the increase in ~~the~~ cost of revenue was personnel expenses, which increased by ~~$25.3~~$28.7 million, or ~~24.3%~~25.0%. This increase in absolute amount was primarily due to the hiring of new resources to manage ~~growth. The~~growth including employees added pursuant to the acquisitions as mentioned above. This increase also reflects overall wage inflation and higher onsite resources which are more expensive than offshore resources. In addition, our re-engineering, analytics and risk consulting business, which has higher compensation and benefit costs, increased faster than our overall business. Our average operational headcount increased by approximately 6,500 employees, or 20.5% in the ~~impact~~first quarter of ~~foreign exchange volatility as described above.~~2011 in comparison to the first quarter of 2010. As a result, our personnel expenses as a percentage of net revenues increased from ~~36.5%~~39.9% in the ~~third~~first quarter of ~~2009~~2010 to ~~40.2%~~43.5% in the ~~third~~first quarter of ~~2010.~~2011.

Operational expenses increased by ~~$11.1~~$8.2 million, or ~~21.8%~~16.6%. The ~~increase in~~increased operational expenses ~~is on account~~in the first quarter of ~~increased~~2011 resulted from higher infrastructure costs ~~incurred in anticipation~~compared to the first quarter of transitions for new contracts which were delayed and higher pass through costs recoverable from clients such as travel and living, and foreign exchange volatility as described above. The operational expenses as2010, due to a ~~percentage of net revenues increased from 17.9%~~one time benefit we received in the ~~third~~first quarter of ~~2009~~2010 on renegotiation of certain contracts related to ~~19.3%~~facilities in ~~the third quarter of 2010.~~

~~Depreciation~~India and ~~amortization expenses increased by $1.5 million, or 12.1%. The increase was largely due to capital expenditures incurred for~~ expansion of infrastructure and IT related facilities over the last twelve months in India. The increase also resulted from increased communication cost and business related travel cost including the cost relating to acquisitions as mentioned above, partially offset by a decline in consultancy charges recoverable from clients. As a result, the operational expenses as a percentage of net revenues increased from 17.1% in the first quarter of 2010 to 17.4% in the first quarter of 2011.

Depreciation and amortization expenses increased by $0.9 million, or 7.0%. The increase was largely due to acquisitions as mentioned above, contributing 57.4% of the increase in depreciation and amortization expenses. The remaining increase was on account of expansion of existing Delivery Centers, infrastructure and IT related facilities in India ~~(Gurgaon),~~and the Philippines ~~and Europe~~ to support ~~growth, and higher costs as a result of foreign exchange volatility during the quarter as described above.~~growth. As a percentage of net revenues, depreciation and amortization expenses ~~remained constant at 4.2%~~declined to 4.0% in the ~~third~~first quarter of ~~2010~~2011 from 4.3% in ~~comparison to~~ the ~~third~~first quarter of ~~2009.~~2010.

As a result of the foregoing, our gross profit ~~decreased marginally~~increased by ~~$0.7~~$4.5 million, or ~~0.6%~~4.1%, and our gross margin decreased from ~~41.3%~~38.7% in the ~~third~~first quarter of ~~2009~~2010 to ~~36.3%~~35.1% in the ~~third~~first quarter of ~~2010.~~2011.

Selling, general and administrative expenses. The following table sets forth the components of our selling, general and administrative ~~expenses in absolute amounts and as a percentage of net revenues:~~expenses:


	Three Months Ended September 30,								Three Months Ended March 31,						% Change Increase/(Decrease)
	2009				2010				2010			2011			2011 vs. 2010
	(dollars in millions)								(dollars in millions)
Personnel expenses	$	45.4	15.9	%	$	51.3	15.9	%	$	51.3		$	47.5			(7.4	)%
Operational expenses		19.2	6.8			17.8	5.5			18.7			18.1			(2.8	)
Depreciation and amortization		2.7	0.9			2.2	0.7			2.9			1.8			(39.0	)

Selling, general and administrative expenses	$	67.2	23.6	%	$	71.3	22.2	%	$	72.9		$	67.4			(7.5	)%

SG&A expenses as a % of total net revenues										25.3	%		20.4	%

Selling, general and administrative expenses, or SG&A expenses, ~~increased~~decreased by ~~$4.0~~$5.5 million, or ~~6.0%~~7.5%. This was primarily due to ~~increased~~a decline in personnel ~~expenses. In addition,~~expenses, cost reduction measures such as restriction on travel, recruitment, thereby more effective utilization and deployment of support personnel. Our average support headcount decreased by 1,900 employees in the ~~increase is also on account~~first quarter of ~~lower realization on our contracted Indian rupee-U.S. dollar hedges~~2011 in ~~2010 compared~~comparison to ~~2009.~~the first quarter of 2010. As a result, as a percentage of net revenues, SG&A expenses decreased from ~~23.6%~~25.3% in the ~~third~~first quarter of ~~2009~~2010 to ~~22.2%~~20.4% in the ~~third~~first quarter of ~~2010.~~2011.

Personnel expenses ~~increased~~decreased by ~~$5.9~~$3.8 million, or ~~13.0%~~7.4%. The ~~increase~~decrease in personnel expenses is primarily due to ~~an increase~~the reduction in ~~senior level employees~~support personnel. The decrease in ~~our business development team as well as~~personnel expenses is also on account of a reduction in share based compensation from $3.9

million in the first quarter of 2010 to $2.3 million in the first quarter of 2011 due to higher forfeiture on account of exceptional events in the first quarter of 2011. This decrease has been partially offset by general wage inflation and ~~foreign exchange volatility~~increased cost as a result of acquisitions as described above. As a percentage of net revenues, personnel expenses ~~remained constant at 15.9%~~decreased from 17.8% in the ~~third~~first quarter of 2010 to 14.4% in ~~comparison to~~ the ~~third~~first quarter of ~~2009.~~2011.

The operational expenses component of SG&A expenses decreased by ~~$1.4~~$0.5 million, or ~~7.4%~~2.8%. ~~This~~$2.8 million of the decrease in operational expenses is attributable to cost rationalization measures in ~~overhead expenses~~overheads such as ~~communication,~~ facility ~~maintenance, marketing,~~expenses, travel and ~~a higher credit~~living and consultancy charges, and decline in ~~indirect taxes~~the number of support personnel compared to growth in ~~India,~~operations personnel in the first quarter of 2011 resulting in reduced allocation to SG&A expenses. This decrease was partially offset by ~~higher costs as~~ a ~~result~~$2.5 million increase due to reserve for doubtful debts in the first quarter of ~~foreign exchange volatility as described above.~~2011 and collection of old doubtful receivables in the first quarter of 2010. As a result, operational expenses as a percentage of net revenues decreased from ~~6.8%~~[6.5]% in the ~~third~~first quarter of ~~2009~~2010 to ~~5.5%~~[5.5]% in the ~~third~~first quarter of ~~2010.~~2011.

Depreciation and amortization expenses as a component of SG&A expenses decreased by ~~$0.5~~$1.1 million to ~~$2.2~~$1.8 million in the ~~third~~first quarter of ~~2010.~~2011. This decrease in depreciation and amortization expenses is due to ~~lower growth~~a decline in the number of support personnel asforming part of SG&A expenses compared to ~~headcount increase~~growth in operations personnel forming part of cost of revenue in the ~~third~~first quarter of ~~2010 in comparison to the third quarter of 2009,~~2011, and consequent reduced allocation to SG~~&A. This decrease was partially offset by higher costs as a result of foreign exchange volatility as described above.~~&A expenses.

Amortization of acquired intangibles. In the ~~third~~first quarter of ~~2009~~2010 and ~~2010,~~2011, we continued to incur non-cash charges of ~~$6.4~~$4.2 million and ~~$3.9~~$3.1 million, respectively, consisting primarily of the amortization of acquired intangibles resulting from the 2004 Reorganization, consistent with the amortization schedule.

Other operating (income) expense, net. Other operating income, consisting primarily of income from shared services from GE for the use of our Delivery Centers and certain support functions that GE manages and operates with its own employees, decreased to ~~$0.8~~$1.0 million in the ~~third~~first quarter of ~~2010~~2011 compared to ~~$1.1~~$2.8 million in the ~~third~~first quarter of ~~2009. We do not recognize the shared services income as net revenues because it is not currently one of our primary service offerings; however, our costs are included in cost of revenue and SG&A.~~

~~Income from operations.~~ ~~As a result of the foregoing factors, income from operations decreased by $2.5 million to $42.4 million in the third quarter of~~ 2010 primarily due to receipt of $4 million from one of our Global Clients related to cancellations in the third quarter of 2009. As a percentage of net revenues, income from operations decreased from 15.8% in the third quarter of 2009 to 13.2% in the third quarter of 2010.

~~Foreign exchange (gains) losses, net.~~ We recorded a foreign exchange gain of $5.5 million in the third quarter of 2010, primarily due to the re-measurement of our non-functional currency assets and liabilities and related foreign exchange contracts resulting from movements in the Indian rupee and U.S. dollar exchange rates in the third quarter of 2010 compared to a foreign exchange loss of $2.6 million in the third quarter of 2009, which also included the impact of the discontinuance of certain cash flow hedges in the third quarter of 2009.

~~Other income (expense), net.~~ We recorded other income including interest income, net of interest expense, of $1.2 million in the third quarter of 2010 compared to $0.3 million in the third quarter of 2009. The change was driven by an increase in other income in the third quarter of 2010 compared to third quarter of 2009. In addition, our interest expense reduced from $0.7 million in the third quarter of 2009 to $0.6 million in the third quarter of 2010 due to repayment of long-term loans and reduction in the weighted average rate of interest with respect to outstanding long-term loans under our credit facility from 1.8% in the third quarter of 2009 to 1.3% in the third quarter of 2010.

~~Income before share of equity in (earnings) loss of affiliates and income tax expense.~~ As a result of the foregoing factors, income before share of equity in (earnings) loss of affiliates and income tax expense increased by $6.5 million. As a percentage of net revenues, income before share of equity in (earnings) loss of affiliates and income tax expense increased from 15.0% in the third quarter of 2009 to 15.3% in the third quarter of 2010.

~~Equity in loss of affiliates.~~ This represents our share of loss from our non-consolidated affiliates, NGEN Media Services Private Limited, a joint venture with NDTV Networks Plc., NIIT Uniqua, a joint venture with NIIT, one of the largest training institutes in Asia, and HPP.

~~Income before income tax expense.~~ As a result of the foregoing factors, income before income tax expense increased by $6.6 million. As a percentage of net revenues, income before income tax expense increased from 14.9% of net revenues in third quarter of 2009 to 15.3% of net revenues in the third quarter of 2010.

~~Income tax expense.~~ Our income tax expense decreased from $7.9 million in the third quarter of 2009 to $7.5 million for the third quarter of 2010. This decrease is primarily driven by certain tax benefits recorded in the third quarter of 2010 based on recent favorable court and administrative rulings, as well as certain changes to the Company’s jurisdictional mix of income. Also, in the third quarter of 2009, we recorded one-time foreign currency gains in certain high tax countries resulting in higher tax expense. This has been partially offset by the expiry of the Indian tax holiday for our major site at Hyderabad effective April 1, 2009, and the expiry of certain other tax benefits, including the reversal of certain deferred tax liabilities on derivatives, that we were able to use in prior years.

~~Net income.~~ As a result of the foregoing factors, net income increased by $7.0 million from $34.6 million in the third quarter of 2009 to $41.6 million in the third quarter of 2010. As a percentage of net revenues, our net income was 12.2% in the third quarter of 2009 and 12.9% in the third quarter of 2010.

~~Net income attributable to noncontrolling interest.~~ The noncontrolling interest is primarily due to the acquisition of E-Transparent B.V. and certain related entities, or ICE, in 2007. It primarily represents the apportionment of profits to the minority partners of ICE. The net income attributable to noncontrolling interest decreased from $1.5 million in the third quarter of 2009 to $1.4 million in third quarter of 2010. The decline is primarily due to volume and price reductions in our SAP offerings in Europe.

~~Net income attributable to Genpact Limited shareholders.~~ As a result of the foregoing factors, net income attributable to Genpact Limited shareholders increased by $7.1 million from $33.1 million in the third quarter of 2009 to $40.1 million in the third quarter of 2010. As a percentage of net revenues, our net income was 11.6% in the third quarter of 2009 and 12.5% in the third quarter of 2010.

~~Nine Months Ended September 30, 2010 Compared to Nine Months Ended September 30, 2009~~

~~Net revenues.~~ Our net revenues increased by $94.3 million, or 11.5%, in the nine months ended September 30, 2010 compared to the nine months ended September 30, 2009. Our growth in net revenues is from business from new clients and GE. Our total headcount increased by 13.6% to approximately 43,300 as of September 30, 2010 from approximately 37,700 as of September 30, 2009. Our revenue per employee was approximately $30.9 thousand in the nine months ended September 30, 2009 which decreased to approximately $30.6 thousand in the nine months ended September 30, 2010 due to an increase in the number of personnel hired for future growth and receipt of one-time income of $4 million from one of our Global Clients for cancellations in the nine months ended September 30, 2009.

Net revenues from GE increased by $19.9 million, or 6.0%. As described under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Overview — Classification of Certain Net Revenues” in our Annual Report on Form 10-K for the year ended December 31, 2009, certain businesses in which GE ceased to be a 20% shareholder are classified as GE net revenues for part of the year until the divesture by GE and as Global Clients net revenues after the divesture by GE. GE revenues for the nine months ended September 30, 2010 increased 6.0% over the nine months ended September 30, 2009 after excluding such dispositions by GE in 2009 and 2010. This increase was primarily driven by growth in finance and accounting, analytics and supply chain service offerings partially offset by volume and price reductions in certain SOWs. As a result of the growth in revenues from Global Clients, GE net revenues declined as a percentage of our total net revenues from 40.6% in the nine months ended September 30, 2009 to 38.6% in the nine months ended September 30, 2010.

Net revenues from Global Clients increased by $74.4 million, or 15.2%. This increase resulted from new business from clients added in the last twelve months, including Walgreens and clients of Symphony, partially offset by decline in information technology services for Global Clients. A portion of the increase in net revenues from Global Clients was also related to GE ceasing to be a 20% shareholder in certain businesses and the reclassification of related net revenues of $1.9 million as described above. In addition, the increase in revenue is attributable to the strengthening of the Pound sterling and Australian dollar against the U.S. dollar, as a portion of our Global Clients revenues are received in such currencies. As a percentage of total net revenues, net revenues from Global Clients increased from 59.4% in the nine months ended September 30, 2009 to 61.4% in the nine months ended September 30, 2010.

Revenues from business process management services increased to 85.9% of total net revenues in the nine months ended September 30, 2010 from 83.8% in the nine months ended September 30, 2009. Revenue from business process management services business grew 14.2% from the nine months ended September 30, 2009 to $787.7 million in the nine months ended September 30, 2010. The increase in business process management revenues was primarily due to new business from Global Clients added in the last twelve months, including clients of Symphony. We also saw growth in finance and accounting, analytics and supply chain service offerings for GE. Revenue from our information technology business decreased by $3.6 million, or 2.7%, in the nine months ended September 30, 2010 compared to the nine months ended September 30, 2009, due to reduction in spending on discretionary information technology projects by GE over the first half of 2010 as well as a volume and price reductions in our SAP offerings in Europe. As a percentage of net revenues, revenue from our information technology business declined to 14.1% in the nine months ended September 30, 2010 from 16.2% in the nine months ended September 30, 2009.

~~Cost of revenue.~~ ~~The following table sets forth the components of our cost of revenue in absolute amounts and as a percentage of net revenues:~~

Cost of revenue increased by $76.1 million, or 15.3%. As a percentage of net revenues, cost of revenue increased from 60.3% in the nine months ended September 30, 2009 to 62.4% in the nine months ended September 30, 2010. This increase is on account of increased headcount and infrastructure costs incurred in anticipation of transitions for new contracts which were delayed and general growth of our business. The increase in cost of revenue is also on account of lower realization on our contracted Indian rupee-U.S. dollar hedges in the first nine months of 2010 compared to the first nine months of 2009.

The largest component of the increase in cost of revenue was personnel expenses, which increased by $62.5 million, or 20.6%. This increase in absolute amount was primarily due to the hiring of new resources to manage growth including employees added through acquisitions in the first half of 2010. The increase also reflects overall wage inflation and the impact of foreign exchange volatility as described above. As a result, our personnel expenses as a percentage of net revenues increased from 36.8% in the nine months ended September 30, 2009 to 39.8% in the nine months ended September 30, 2010.

Operational expenses increased by $9.1 million, or 5.7%. The increase in operational expenses is as a result of increased infrastructure costs incurred in anticipation of transitions for new contracts which were delayed and higher pass through costs recoverable from clients such as travel and living, and foreign exchange volatility as described above. This increase was partially off-set by the cost rationalization measures in overheads such as communication and other costs. The operational expenses as a percentage of net revenues decreased from 19.3% in the nine months ended September 30, 2009 to 18.3% in the nine months ended September 30, 2010.

Depreciation and amortization expenses increased by $4.5 million, or 13.1%. The increase was largely due to capital expenditures incurred for expansion of infrastructure and IT related facilities over the last twelve months in India (Gurgaon), Americas and Europe to support growth, and higher costs as a result of foreign exchange volatility as described above. As a percentage of net revenues, depreciation and amortization expenses increased marginally from 4.2% in the nine months ended September 30, 2009 to 4.3% in the nine months ended September 30, 2010.

As a result of the foregoing, our gross profit increased by $18.2 million, or 5.6%, and our gross margin decreased from 39.7% in the nine months ended September 30, 2009 to 37.6% in the nine months ended September 30, 2010.

~~Selling, general and administrative expenses.~~ ~~The following table sets forth the components of our selling, general and administrative expenses in absolute amounts and as a percentage of net revenues:~~

Selling, general and administrative expenses, or SG&A expenses, increased by $24.5 million, or 12.6%. As a percentage of net revenues, SG&A expenses increased marginally from 23.7% in the nine months ended September 30, 2009 to 23.9% in the nine months ended September 30, 2010. This increase in SG&A expenses was primarily due to increased personnel expenses. The increase in selling, general and administrative expenses is also on account of lower realization on our contracted Indian rupee-U.S. dollar hedges in the first nine months of 2010 compared to the first nine months of 2009.

Personnel expenses increased by $23.3 million, or 17.7%. The increase in personnel expenses is primarily due to an increase in senior level employees in our business development team as well as general wage inflation. In addition, this increase was attributable to higher costs as a result of foreign exchange volatility as described above. As a result, personnel expenses as a percentage of net revenues increased from 16.0% in the nine months ended September 30, 2009 to 16.9% in the nine months ended September 30, 2010.

The operational expenses component of SG&A expenses increased by $0.9 million, or 1.7%. This increase is attributable to higher travel related expenses for business development activities, increased expenditure related to Smart Enterprise Processes (SEP^sm) and higher costs as a result of foreign exchange volatility as described above, offset by the cost rationalization measures in overheads such as communication and other costs, reduction in the reserve for doubtful debts due to collection of old doubtful receivables in the first half of 2010 and a higher credit in indirect taxes in India. As a result, operational expenses as a percentage of net revenues decreased from 6.7% in the nine months ended September 30, 2009 to 6.1% in the nine months ended September 30, 2010.

Depreciation and amortization expenses as a component of SG&A expenses increased marginally by $0.2 million to $7.9 million in the nine months ended September 30, 2010. This increase in depreciation and amortization expenses is due to higher capital expenditure incurred for expansion of existing Delivery Centers over the last twelve months and higher costs as a result of foreign exchange volatility as described above.

~~Amortization of acquired intangibles.~~ In the nine months ended September 30, 2009 and 2010, we continued to incur significant non-cash charges of $19.7 million and $12.2 million, respectively, consisting primarily of the amortization of acquired intangibles resulting from the 2004 Reorganization, consistent with the amortization schedule.

~~Other operating (income) expense, net.~~ Other operating income, consisting of income from shared services from GE for the use of our Delivery Centers and certain support functions that GE manages and operates with its own employees, increased to $4.8 million in the nine months ended September 30, 2010 compared to $4.0 million in the nine months ended September 30, 2009 mainly due to reversal of the provision of $1.3 million in the first quarter of 2010 for employee related statutory liabilities in one of our subsidiaries. We do not recognize the shared services income as net revenues because it is not currently one of our primary service offerings; however, our costs are included in cost of revenue and SG&A.

Income from operations. As a result of the foregoing factors, income from operations increased by ~~$2.1~~$9.3 million to ~~$118.0~~$46.5 million in the ~~nine months ended September 30, 2010.~~first quarter of 2011. As a percentage of net revenues, income from operations ~~decreased~~increased from 12.9% in the first quarter of 2010 to 14.1% in the ~~nine months ended September 30, 2009 to 12.9% in the nine months ended September 30, 2010.~~first quarter of 2011.

Foreign exchange (gains) losses, net. We recorded a foreign exchange ~~loss~~gain of ~~$0.1~~$1.6 million ~~for~~in the ~~nine months ended September 30, 2010,~~first quarter of 2011, primarily due to the re-measurement of our non-functional currency assets and liabilities and related foreign exchange contracts resulting from movements in the Indian rupee and U.S. dollar exchange rates in the first ~~nine months~~quarter of ~~2010~~2011 compared to a foreign exchange loss of ~~$2.0~~$0.7 million in the ~~nine months ended September 30, 2009, net~~first quarter of 2010, which also included the impact of the discontinuance of certain cash flow hedges in the ~~nine months ended September 30, 2009.~~first quarter of 2010.

Other income (expense), net. The following table sets forth the components of other income (expense), net:

We recorded other income including interest income, net of interest expense, of ~~$3.3~~$3.1 million in the ~~nine months ended September 30, 2010~~first quarter of 2011 compared to ~~$3.4~~$1.3 million in the ~~nine months ended September 30, 2009.~~first quarter of 2010. The change was driven by ~~a decrease~~an increase in interest income ~~in the first nine months of 2010~~ due to ~~investment in U.S. Treasury bills compared to our~~increased investment in higher interest bearing bank deposits in the first ~~nine months~~quarter of ~~2009. This decrease was partially offset by decrease in~~2011 compared to the first quarter of 2010 and interest ~~expense due to repayment of a portion of our long-term loan and increase in other~~ income ~~by $2.5 million. In addition, weighted average rate of interest with respect to outstanding long-term loans under our credit facility was reduced from 1.8%~~on an income tax refund received in the ~~nine months ended September 30, 2009 to 1.1% in the nine months ended September 30, 2010.~~first quarter of 2011.

Income before share of equity in ~~(earnings)~~ loss of affiliates and income tax expense. As a result of the foregoing factors, income before share of equity in ~~(earnings)~~ loss of affiliates and income tax expense increased by ~~$3.9~~$13.4 million. As a percentage of net revenues, income before share of equity in ~~(earnings)~~ loss of affiliates and income tax expense ~~decreased~~increased from ~~14.3%~~13.1% in the ~~nine months ended September 30, 2009~~first quarter of 2010 to ~~13.2% of net revenues~~15.5% in the ~~nine months ended September 30, 2010.~~first quarter of 2011.

Equity in loss of affiliates. This represents our share of loss from our non-consolidated affiliates, NGEN Media Services Private Limited, a joint venture with NDTV Networks Plc., NIIT Uniqua, a joint venture with NIIT, one of the largest training institutes in Asia, and ~~HPP.~~High Performance Partners.

Income before income tax expense. As a result of the foregoing factors, income before income tax expense increased by ~~$3.8~~$13.6 million. As a percentage of net revenues, income before income tax expense ~~decreased~~increased from ~~14.2%~~13.0% of net revenues in the ~~nine months ended September 30, 2009~~first quarter of 2010 to ~~13.1%~~15.4% of net revenues in the ~~nine months ended September 30, 2010.~~first quarter of 2011.

Income tax expense. Our income tax expense increased from ~~$18.4~~$7.2 million in the ~~nine months ended September 30, 2009~~first quarter of 2010 to ~~$19.6~~$13.1 million ~~for~~in the ~~nine months ended September 30, 2010.~~first quarter of 2011. This increase is primarily driven by ~~higher profits,~~ the ~~expiry~~complete sunset of the ~~Indian~~India tax holiday under the STPI regime for ~~our major site at Hyderabad~~remaining exempt locations effective ~~April 1, 2009, as well as the expiry of~~March 31, 2011 and also due to certain ~~other tax benefits, including the reversal of certain deferred tax liabilities on derivatives that we were able to use in prior years. This has been partially offset by certain tax benefits recorded~~period items booked in the ~~third~~first quarter of ~~2010 based on recent favorable court and administrative rulings, as well as certain changes to the Company’s jurisdictional mix of income.~~2011.

Net income. As a result of the foregoing factors, net income increased by ~~$2.7~~$7.7 million from ~~$98.3~~$30.2 million in the ~~nine months ended September 30, 2009~~first quarter of 2010 to ~~$100.9~~$37.9 million in the ~~nine months ended September 30, 2010.~~first quarter of 2011. As a percentage of net revenues, our net income was ~~11.9%~~10.5% in the ~~nine months ended September 30, 2009~~first quarter of 2010 and ~~11.0%~~11.5% in the ~~nine months ended September 30, 2010.~~first quarter of 2011.

Net income attributable to noncontrolling interest. The noncontrolling interest is primarily due to the acquisition of E-Transparent B.V. and certain related entities, or ICE, in 2007. It primarily represents the apportionment of profits to the minority partners of ICE. The net income attributable to noncontrolling interest decreased from ~~$5.6~~$2.1 million in the ~~nine months ended September 30, 2009~~first quarter of 2010 to ~~$4.8~~$1.8 million in ~~nine months ended September 30, 2010.~~first quarter of 2011. The decline is primarily due to volume and price reductions in our SAP ~~offerings in Europe in the nine months ended September 30, 2010.~~offerings.

Net income attributable to Genpact Limited shareholders. As a result of the foregoing factors, net income attributable to Genpact Limited shareholders increased by ~~$3.4~~$7.9 million from ~~$92.7~~$28.2 million in the ~~nine months ended September 30, 2009~~first quarter of 2010 to ~~$96.2~~$36.1 million in the ~~nine months ended September 30, 2010.~~first quarter of 2011. As a percentage of net revenues, our net income was ~~11.3%~~9.8% in the ~~nine months ended September 30, 2009~~first quarter of 2010 and ~~10.5%~~10.9% in the ~~nine months ended September 30, 2010.~~first quarter of 2011.

Information about our financial position as of December 31, ~~2009~~2010 and ~~September 30, 2010~~March 31, 2011 is presented below:

We finance our operations and our expansion with cash from operations and short-term borrowing facilities and credit facilities. ~~We also incurred $180 million of long-term debt to finance in part the 2004 Reorganization.~~

Our cash and cash equivalents were ~~$360.9~~$351.8 million as of ~~September 30, 2010~~March 31, 2011 compared to ~~$288.7~~$404.0 million as of December 31, ~~2009.~~2010. Our cash and cash equivalents ~~are~~as of March 31, 2011 were comprised of (a) ~~$98.0~~$114.8 million in cash in current accounts across all operating locations to be used for working capital and immediate capital requirements, (b) ~~$179.4~~$231.9 million in term deposits with banks to be used for medium term planned expenditure and capital requirements, and (c) ~~$83.5~~$5.0 million in U.S. Treasury bills with an original maturity of less than three months.

In addition, we held ~~$43.0~~$129.5 million in U.S. Treasury bills ~~and withdrew all short-term deposits with GE India affiliates~~ as of ~~September 30, 2010,~~March 31, 2011, to be used for longer term capital requirement and acquisitions, compared to ~~$132.6~~$77.0 million of U.S. Treasury bills ~~and $9.6 million of short term deposits with GE India affiliates~~ as of December 31, ~~2009.~~2010.

We expect that in the future our cash from operations, cash reserves and debt capacity will be sufficient to finance our operations as well as our growth and expansion. Our working capital needs are primarily to finance our payroll and other related administrative and information technology expenses in advance of the receipt of accounts receivable. Our capital requirements include the opening of new Delivery Centers, as well as financing acquisitions.

Cash flows from operating, investing and financing activities, as reflected in our consolidated statements of cash flows, are summarized in the following table:


	Nine Months Ended September 30,						Three Months Ended March 31,						% Change Increase/(Decrease)
	2009			2010			2010			2011			% Change Increase/(Decrease)
	(dollars in millions)						(dollars in millions)
Net cash provided by (used for)
Operating activities	$	123.5		$	78.0		$	(20.1	)	$	21.1			205.2	%
Investing activities		(21.1	)		7.7			73.4			(60.0	)		(181.8	)
Financing activities		(44.8	)		(22.4	)		(6.1	)		(13.9	)		(128.6	)

Net increase in cash and cash equivalents	$	57.6		$	63.3
Net increase (decrease) in cash and cash equivalents							$	47.3		$	(52.8	)		(211.8	)%

Cash ~~flow~~flows from operating activities. Our net cash ~~provided by~~generated from operating activities was ~~$78.0~~$21.1 million in the ~~nine months ended September 30, 2010 as~~first quarter of 2011 compared to ~~$123.5~~net cash used for operating activities of $20.1 million in the ~~nine months ended September 30, 2009. The year~~first quarter of 2010. Our net income adjusted for amortization and depreciation and other non-cash items increased by $10.2 million. In addition, the increase was on ~~year decline was~~account of reduction in accounts receivable and other assets by $17.5 million primarily due to ~~incremental working capital~~improved receivables management coupled with lower deterioration of ~~$10.8 million related~~DSO in the first quarter of 2011 in comparison to the ~~acquisition~~first quarter of ~~Symphony including acquired current liabilities of $5.4 million, deposits for infrastructure investments of $4.0 million, change in accounts receivable by $22.6 million due to higher revenues~~2010, and an increase in ~~our credit period with GE implemented over the course of last year resulting in higher days sales outstanding, and reduction in current liabilities~~accrued expenses and income taxes ~~payable.~~payable by $14.8 million.

Cash ~~flow~~flows from investing activities. Our net cash used in investing activities was $60.0 million in the first quarter of 2011 compared to $73.4 million of net cash provided by investing activities ~~was $7.7 million~~ in the ~~nine months ended September 30,~~first quarter of 2010 primarily due to reasons explained in this paragraph below. We paid $52.5 million for the purchase of U.S. Treasury bills, net of sales realization, during the first quarter of 2011, compared to ~~$21.1~~net realization of $132.6 million of net cash used for investing activities in the nine months ended September 30, 2009. We paid $47.7 million in the nine months ended September 30, 2010 for purchases of property, plant and equipment in connection with the expansion of existing Delivery Centers and capital expenditures payable compared to $43.9 million in the nine months ended September 30, 2009. We realized $89.6 million from ~~the~~ sale of U.S. Treasury bills and ~~$9.7~~$9.8 million from redemption of deposits with GE India ~~net of amount invested,~~ during the ~~nine months ended September 30, 2010, as~~first quarter of 2010. In addition, we paid $6.2 million in the first quarter of 2011 for purchases of property, plant and equipment compared to ~~$2.6~~$25.0 million ~~invested~~ in ~~U.S. Treasury bills and $43.9 million realized from redemption~~the first quarter of ~~deposits with GE India, net of amount invested, during the nine months ended September 30, 2009.~~2010. Further, during the first ~~nine months~~quarter of ~~2010~~2011 we paid ~~$42.6~~$1.6 million for the

acquisition of Akritiv compared to $42.0 million paid for business acquisitions, net of cash acquired, including $16.3 million as ~~compared to $20.2 million~~an advance in the first ~~nine months~~quarter of ~~2009. We made an investment of $2.3 million in a non-consolidating affiliate in the first nine months of 2010 compared to $0.3 million in the first nine months of 2009.~~2010.

Cash ~~flow~~flows from financing activities. Our net cash used for financing activities was ~~$22.4~~$13.9 million in the ~~nine months ended September 30, 2010,~~first quarter of 2011, compared to ~~$44.8~~$6.1 million in the ~~nine months ended September 30, 2009.~~first quarter of 2010. We repaid ~~$32.5~~$12.5 million of our long term debt as part of our scheduled repayments under our credit agreement compared to repayment of $10.0 million of long term debt and $0.2 million of our short-term borrowings ~~drawn~~ in the ~~fourth~~first quarter of ~~2009 in the nine months ended September 30, 2010 as compared to repayment of $20.0 million of long term debt and $25 million of our short-term borrowings in the nine months ended September 30, 2009.~~2010. In addition, we paid the noncontrolling partners of ICE ~~$4.7~~$1.5 million in the ~~nine~~three months ended ~~September 30, 2010~~March 31, 2011 compared to ~~$5.6~~$1.7 million in the ~~nine~~three months ended ~~September 30, 2009.~~March 31, 2010. We received ~~$18.5~~$0.8 million as proceeds from the issuance of common shares on exercise of employee stock options in the ~~nine~~three months ended ~~September 30, 2010 as~~March 31, 2011 compared to ~~$7.7~~$6.4 million in the ~~nine~~three months ended ~~September 30, 2009.~~March 31, 2010.

Total long-term debt excluding capital lease obligations was ~~$37.4~~$12.5 million as of ~~September 30, 2010~~March 31, 2011 compared to ~~$69.7~~$25.0 million as of December 31, ~~2009, which represented long-term debt primarily related to the 2004 Reorganization.~~2010. The decrease in long-term debt is due to repayment as per the repayment schedule in accordance with the terms of the loan agreement. The weighted average rate of interest with respect to outstanding long-term loans under the credit facility was ~~1.8% and 1.1%~~consistent at 1.0% for the ~~nine~~three months ended ~~September 30, 2009~~March 31, 2010 and ~~2010, respectively.~~2011.

We finance our short-term working capital requirements through cash flow from operations and credit facilities from banks and financial institutions. As of ~~September 30, 2010,~~March 31, 2011, short-term credit facilities available to the Company aggregated $145.0 million, which are under the same agreement as our long-term debt ~~facility. As~~facility, out of ~~September 30, 2010,~~this, a total of ~~$11.5~~$7.4 million was utilized, which represented non-funded drawdown, and $17.6 million as fund-based and non-fund-based credit facilities with banks, out of which, a total of $3.1 million was utilized, which represented non-funded drawdown.

~~We test goodwill for impairment at least on an annual basis on September 30. Goodwill~~On April 29, 2011, we terminated our existing credit agreement. On May 3, 2011, we entered in a new credit agreement of ~~a reporting unit is tested for impairment between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value~~$380.0 million consisting of the reporting unit below its carrying amount. Determining whether an impairment has occurred requires valuation of the respective reporting units, which we estimate using a discounted cash flow model. The valuation of a reporting unit is judgmental in nature$120.0 million term loan and involves the use of significant estimates and assumptions which we believe to be reasonable but that are unpredictable and inherently uncertain and accordingly actual results may differ from these estimates. These estimates and assumptions include revenue growth rates and operating margins used to calculate projected future cash flows, risk-adjusted discount rates, terminal growth rates, future economic and market conditions. We derived our discount rate using the capital asset pricing model and analyzing published rates for industries relevant to our reporting units to estimate the cost of equity financing. We used a discount rate that is commensurate with the risks and uncertainties in the business and our internally developed forecasts. The results of our evaluation as of September 30, 2010, showed that the fair values of all our reporting units exceeded their book values. Based upon our analysis at September 30, 2010, the estimated fair value for each of our reporting unit exceeded its carrying value by at least 79%.

~~In line with our long term strategy and focus for the technology business, we decided to integrate one of our reporting units (ICE), together with the India software practice included~~$260.0 million revolver. Borrowings under the ~~India reporting unit. As~~credit agreement bear interest at a ~~result~~rate equal to LIBOR plus an applicable margin equal to 1.65% per annum. The revolving credit commitments under the credit agreement are subject to a commitment fee equal to 0.70% on the actual daily amount by which the aggregate revolving commitments exceed the sum of ~~the difference in the operating models between the India software practice~~outstanding revolving and ~~ICE, prior to the integration we operated the two businesses as independent operations with separate service offerings~~swing line loans and ~~clients. Through the end~~letter of 2009, synergies that may have been available between the two businesses were not utilized, and when one business pursued an opportunity at another segment’s client, limited or no effort was taken to pursue or solution the opportunity jointly. As a result, we were not able to provide the most optimum solution to our clients and our win rates were less than we would have liked. Considering the inefficiencies in managing the software operations of each business independently, and given the market trend that SAP services are being delivered not by a local unit but globally with a mix of on-site and off-shore resources, we have integrated the operations of ICE with our India software operations. This integration enabled us to leverage the business experience, SAP certifications, and resources more effectively and provide a global service delivery model. As of September 1, 2010, the ICE and India software business are being managed as one business, and accordingly the targets and reporting have been re-aligned to that effect.credit obligations.

As a result of this change, we tested goodwill contained in the ICE reporting unit for impairment as of August 31, 2010, prior to the integration with the India software practice, for events and conditions identified in accordance with the guidance in ASC 350, “Intangibles - Goodwill and Other”. The fair value of this reporting unit was calculated using a discounted cash flow model using estimated future cash flows. The results of our testing showed that, as of August 31, 2010, the fair value of this reporting unit exceeded its book value.

Our off-balance sheet arrangements consist of certain operating leases. For additional information, see “Contractual Obligations” below.

The following table sets forth our total future contractual obligations as of ~~September 30, 2010:~~March 31, 2011:


	Less than 1 year		1-3 years		4-5 years		After 5 years		Total		Less than 1 year		1-3 years		3-5 years		After 5 years			Total
Long-term debt	$	37.4	$	—	$	—	$	—	$	37.4	$	12.5	$	—	$	—	$	—		$	12.5
Capital leases		2.0		2.6		0.1		—		4.8		1.8		2.0		0.1		—	��		3.9
Operating leases		26.3		43.7		72.1		—		142.1		24.7		44.5		27.0		31.7			127.9
Purchase obligations		7.7		—		—		—		7.7		7.6		—		—		—			7.6
Capital commitments net of advances		7.2		—		—		—		7.2		3.3		—		—		—			3.3
Other long-term liabilities (1)		83.7		40.3		1.4		—		125.4		40.7		33.1		2.2		—			76.0

Total contractual cash obligations	$	164.4	$	86.6	$	73.7	$	—	$	324.6	$	90.7	$	79.5	$	29.3	$	31.7		$	231.2

For a description of recently adopted accounting pronouncements, see Note 2 - “Recently adopted accounting pronouncements” under Item 1 - “Financial Statements” above and Part-II Item-7 - “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Estimates” in our Annual Report on Form 10-K for the year ended December 31, ~~2009.~~2010.

In April, 2010, FASB issued ASU 2010-13 which states that an employee share-based payment award with an exercise price denominated in the currency of a market in which a substantial portion of the entity’s equity securities trades should not be considered to contain a condition that is not a market, performance, or service condition. Therefore, such an award should not be classified as a liability based only on this condition if it otherwise qualifies as equity. The amendments in this Update are effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2010. The Company does not expect a significant impact upon adoption of the provisions of the FASB guidance on the Company’s consolidated financial statements.

During the ~~nine~~three months ended ~~September 30, 2010,~~March 31, 2011, there were no material changes in our market risk exposure. For a discussion of our market risk associated with foreign currency risk, interest rate risk and credit risk, see Item 7A “Quantitative and Qualitative Disclosures about Market Risk” in our Annual Report on Form 10-K for the year ended December 31, ~~2009.~~2010.

Disclosure controls and procedures are the Company’s controls and other procedures which are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934 (the “Exchange Act”) is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer along with the Company’s Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to the Exchange Act Rule 13a-15(b). Based upon that evaluation, the Company’s Chief Executive Officer along with the Company’s Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective in timely alerting them to material information relating to the Company (including its consolidated subsidiaries) required to be included in the Company’s periodic SEC filings.

There have been no changes in the Company’s internal controls over financial reporting during the quarter ended ~~September 30, 2010~~March 31, 2011 that have materially affected, or are reasonably likely to materially affect, the Company’s internal controls over financial reporting.

There are no legal proceedings pending against us that we believe are likely to have a material adverse effect on our business, results of operations and financial condition.

We have disclosed under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, ~~2009~~2010 the risk factors that materially affect our business, financial condition or results of operations. You should carefully consider the “Risk Factors” set forth in our Annual Report on Form 10-K for the year ended December 31, ~~2009~~2010 and the other information set forth elsewhere in this Quarterly Report on Form 10-Q. You should be aware that these risk factors and other information may not describe every risk facing our Company. Additional risks and uncertainties not currently known to us also may materially adversely affect our business, financial condition and/or results of operations.

On August 1, 2007, we commenced an initial public offering of our common shares, pursuant to which the Company and our selling shareholders each sold 17,647,059 common shares at a price of $14 per share. On August 14, 2007, the underwriters exercised their option to purchase 5,294,118 additional common shares from the Company at the initial offering price of $14 per share to cover over-allotments. The sales were made pursuant to a registration statement on Form S-1 (File No. 333-142875), which was declared effective by the SEC on August 1, 2007. The managing underwriters in the offering were Morgan Stanley & Co. Incorporated, Citigroup Global Markets Inc. and J.P. Morgan Securities Inc. The underwriting discounts and commissions and offering expenses payable by us aggregated $9.0 million, resulting in net proceeds to us of $294.5 million. We did not receive any proceeds from common shares sold by the selling shareholders.

We used $98.1 million of the net proceeds from our initial public offering to repay revolving loan indebtedness outstanding under our credit facility. In addition, we used ~~$92.5~~$117.5 million of the net proceeds from our initial public offering partially to repay long term indebtedness outstanding under our credit facility in accordance with the regular payment schedule for such indebtedness.

We paid $16.3 million in January 2010 for the arrangement with Walgreens, ~~and~~ acquired Symphony for $29.3 million in February ~~2010.~~2010 and acquired Akritiv for a cash consideration of $1.6 million in March 2011. The remaining proceeds are invested in short-term deposit accounts and U.S. Treasury bills. There has been no material change in the planned use of proceeds from our initial public offering as described in our final prospectus filed with the SEC pursuant to Rule 424(b) on August 2, 2007.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


Customer-related intangible assets		3-10 years
Marketing-related intangible assets		1-5 years
Contract-related intangible assets		1 year
Other intangible assets		33-8 years


Net assets and liabilities (excluding tangible fixed assets)	$	(3,259	)
Tangible fixed assets		2,612
Customer related intangible assets		12,460
Goodwill		14,168
Deferred tax assets, net		3,322

	$	29,303


Net assets and liabilities	$	(166	)
Other intangible assets (Technology related intangible assets)		600
Goodwill		2,992
Deferred tax liabilities, net		(131	)

	$	3,295


Tangible fixed assets	$	12,825
Goodwill		2,083
Deferred tax assets, net		1,439

	$	16,347


	As of December 31, 2010		As of March 31, 2011
Deposits with banks	$	208,072	$	231,925
U.S. Treasury bills		91,490		5,000
Other cash and bank balances		104,472		114,841

Total	$	404,034	$	351,766


	As of December 31, 2010
	Carrying Value		Unrealized gains		Unrealized losses		Estimated Fair Value
Short term investments:
U.S. Treasury bills	$	76,974	$	11	$	—	$	76,985

Total	$	76,974	$	11	$	—	$	76,985


	As of March 31, 2011
	Carrying Value		Unrealized gains		Unrealized losses		Estimated Fair Value
Short term investments:
U.S. Treasury bills	$	129,469	$	15	$	—	$	129,484

Total	$	129,469	$	15	$	—	$	129,484


Derivatives not designated as hedging instruments	Location of (Gain) Loss recognized in Income on Derivatives	Amount of (Gain) Loss recognized in Income on Derivatives
Derivatives not designated as hedging instruments	Location of (Gain) Loss recognized in Income on Derivatives	Three months ended September 30,					Nine months ended September 30,
		2009		2010			2009			2010
Forward foreign exchange contracts (Note a)	Foreign exchange (gains) losses, net	$	462	$	(1,924	)	$	(2,956	)	$	(8,243	)
Forward foreign exchange contracts (Note b)	Foreign exchange (gains) losses, net		6,855		—			13,070			(234	)

		$	7,317	$	(1,924	)	$	10,114		$	(8,477	)


	As of December 31, 2010		As of March 31, 2011
Opening balance	$	548,723	$	570,153
Goodwill relating to acquisitions consummated during the period		16,251		2,992
Effect of exchange rate fluctuations		5,179		4,895

Closing balance	$	570,153	$	578,040


	As of December 31, 2010						As of March 31, 2011
	Gross carrying amount		Accumulated amortization		Net		Gross carrying amount		Accumulated amortization		Net
Customer-related intangible assets	$	222,285	$	188,989	$	33,296	$	223,445	$	193,147	$	30,298
Marketing-related intangible assets		15,835		15,835		—		15,886		15,886		—
Contract-related intangible assets		1,423		1,423		—		1,428		1,428		—
Other intangible assets		318		267		51		929		302		627

	$	239,861	$	206,514	$	33,347	$	241,688	$	210,763	$	30,925


	Nine months ended September 30, 2010
	Number of Restricted Shares			Weighted Average Grant Date Fair Value
Outstanding as of January 1, 2010		47,306		$	14.04
Granted		—			—
Vested and allotted		(23,653	)		14.04
Forfeited		—			—

Outstanding as of September 30, 2010		23,653		$	14.04


	Nine months ended September 30, 2010
	Number of Restricted Share Units			Weighted Average Grant Date Fair Value
Outstanding as of January 1, 2010		325,000		$	10.09
Granted		111,000			14.48
Vested and allotted		(37,500	)		12.23
Forfeited		—			—

Outstanding as of September 30, 2010		398,500		$	11.11


	Three months ended March 31, 2011
	Number of Performance Units			Weighted Average Grant Date Fair Value		Maximum Shares Eligible to Receive
Outstanding as of January 1, 2011		895,333		$	15.38		1,343,000
Granted		877,000			13.42		1,315,500
Vested and allotted		—			—		—
Forfeited		(19,000	)		16.25		(28,500	)

Outstanding as of March 31, 2011		1,753,333		$	14.39		2,630,000

Performance units vested and expected to vest		1,687,047


	Original Performance Target						Modified Performance Target
Performance Level	Revenue Growth			EBITDA Growth			Revenue Growth			Adjusted Income from Operation growth
Outstanding		20.0	%		20.0	%		20.0	%		20.0	%
Threshold		15.0	%		15.0	%		15.0	%		15.0	%
Target		10.0	%		10.0	%		10.0	%		10.0	%


	Nine months ended September 30, 2010
	Number of Performance Units			Weighted Average Grant Date Fair Value
Outstanding as of January 1, 2010		—		$	—
Granted		1,110,000			15.20
Vested and allotted		—			—
Forfeited		(31,000	)		16.25

Outstanding as of September 30, 2010		1,079,000		$	15.17


Opening balance at January 1, 2010	$	13,195
Increase related to prior year tax positions, including recorded against goodwill		4,500
Effect of exchange rate changes		61
Closing balance at September 30, 2010	$	17,756


Opening balance at January 1, 2011	$	20,016
Decrease related to prior year tax positions		(63	)
Effect of exchange rate changes		51

Closing balance at March 31, 2011	$	20,004


	As of December 31, 2009		As of September 30, 2010		% Change
	(dollars in millions)
Cash and cash equivalents	$	288.7	$	360.9		25.0	%
Short-term investment		132.6		43.0		(67.6	)
Short-term deposits with related party		9.6		—		(100.0	)
Short term borrowings		0.2		—		(100.0	)
Long-term debt due within one year		44.7		37.4		(16.4	)
Long-term debt other than the current portion		25.0		—		(100.0	)
Genpact Limited total shareholders’ equity	$	1,197.4	$	1,377.7		15.1	%


Exhibit Number		Description

3.1		Memorandum of Association of the Registrant (incorporated by reference to Exhibit 3.1 to Amendment No. 2 of the Registrant’s Registration Statement on Form S-1 (File No. 333-142875) filed with the SEC on July 16, 2007).

3.3		Bye-laws of the Registrant (incorporated by reference to Exhibit 3.3 to Amendment No. 4 of the Registrant’s Registration Statement on Form S-1 (File No. 333-142875) filed with the SEC on August 1, 2007).

10.1		Agreement and Plan of Merger dated April 5, 2011 among Genpact International, Inc., Hawk International Corporation, Headstrong Corporation, WCAS Hawk Corp. and the Registrant.*

10.2		Credit Agreement dated May 3, 2011 by and among the Registrant, Genpact International, Inc., Hawk International Corporation, Bank of America, N.A., as administrative agent and collateral agent, and Bank of America, N.A., Citigroup Global Markets Asia Limited, JPMorgan Chase Bank, N.A., Hong Kong Branch and UBS AG Hong Kong Branch as mandated lead arrangers and bookrunners and the other lenders party thereto.*

31.1		Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*

31.2		Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*

32.1		Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*

32.2		Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*

101.INS		XBRL Instance Document (1)

101.SCH		XBRL Taxonomy Extension Schema Document (1)

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document (1)

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document (1)

101.LAB		XBRL Taxonomy Extension Label Linkbase Document (1)

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document (1)


GENPACT LIMITED

By:		/S/ PRAMOD BHASIN
		Pramod Bhasin
		Chief Executive Officer

		/S/ MOHIT BHATIA
		Mohit Bhatia
		Chief Financial Officer

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