Software services provider MphasiS Ltd has reported a year-on-year increase of 14.4 per cent in net profit for the quarter ended October, thanks to a combination of greater efficiency, higher margins and decline in the effective tax rate.

The mid-tier software services firm, which receives a major portion of its revenue from computer giant Hewlett-Packard (HP), said its net profit jumped to Rs 209.31 crore in three months ended October 31, 2012, from Rs 183.03 crore in the corresponding period of last year.

However, net profit was little changed on sequential basis.

MphasiS' non-HP business jumped 38 per cent in the financial year of 2012 to Rs 2,391 crore, while operating margin climbed 90 basis points because of decline in discretionary expenses and increase in utilization.

Commenting on the trading results, MphasiS CEO Ganesh Ayyar said, "Our focus on driving operational excellence has resulted in incremental margin expansion in each quarter this year."

Ayyar added that the successful execution of the firm's strategic plan would keep on generating strong cash flows in the coming quarters.

During the past quarter, MphasiS gained 22 new clients, of which fourteen were added to the direct channel, while eight were added in the HP part of the business.

MphasiS' board has recommended a dividend of Rs 17 a share for the financial year.