India's third largest IT exporter Infosys just about met Street expectations on
dollar revenue growth in the three months to December. But it provided cheer to investors by
revising its full year growth guidance upwards, a reflection that the demand environment for IT buying was improving.
The company's revenues in dollar terms increased 1.7 per cent over the September quarter to $2.1 billion. In rupee terms, revenues totalled Rs 13,026 crore, a rise of just 0.5 per cent.
Equity analysts saw the company growing its sequential topline in the quarter between 1.7 to 2.3 per cent versus 3 to 4 per cent that other top-tier Indian IT companies are expected to clock.
Net profits increased to Rs 2,875 crore or Rs 50.32 a share from Rs 2,407 crore or Rs 42.12 a share in the previous quarter with Infosys, evidently, doing a good job of managing costs. The company's overall employee number decreased to 158,404 in December quarter from 160,227 in September.
Infosys revised its
full year 2013/2014 revenue outlook upwards to a growth of 11.5-12 per cent, from 9-10 per cent seen earlier. This appeared positive to analysts considering that many were wary of the frequent management exits and continued restructuring at Infosys. The company lost two of its CEO hopefuls, Ashok Vemuri and V. Balakrishnan, in a span of four months.
S. D. Shibulal, CEO and Managing Director, appeared optimistic. In a press note, he said, "The year ahead looks exciting for the IT services industry. We believe the global economic environment has improved and our clients are gaining confidence to invest in their strategic initiatives."
Sanjeev Hota, analyst with brokerage house Sharekhan, said that the margins surprised positively. "The management commentary is also positive. The company is getting into a momentum and 2014/2015 will be a much better year for Infosys," he said.
Dipen Shah of Kotak Securities said that the results were a mixed bag. "While revenues matched expectations, the margins were better than expectations, largely due to reduced sales and marketing expenses and reduced headcount. The management is positive about the growth going ahead, despite it expecting budgets to remain flat. Attrition has increased and that remains a concern," he noted.
Infosys was up 2.41 per cent to 3534.25 on the BSE at 2.27 P.M. The BSE Sensex was up marginally at 20,779.74.
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