Infosys results: With Narayana Murthy at helm,profit rises 1.6%,share price up

Narayana Murthy-led Infosys' revenues for second quarter rise 31.5%.

Written by Fe Bureau | Bangalore | Published: October 11, 2013 9:15:25 am

NR Narayana Murthy-led Infosys Limited,India’s second largest IT services exporter reported a 1.6% rise in consolidated net profit on Friday for the Q2 ending September 30,2013. Infosys Q2 net profit was at Rs 2,407 crore as against Rs 2,369 crore a year ago. The company’s revenues for the second quarter grew 31.5% year-on-year to Rs 12,965 crore as against Rs 9,858 crore a year ago. Sequentially,net profit grew 1.4% while revenue rose 15.07%.

In dollar terms,Infosys’ posted a year-on-year decline of 11.1% in net profit at $383 million for the quarter while revenue grew 15% to $2066 million.

Infosys,India’s second largest IT services company,raised the lower bar of its dollar revenue growth projection for FY14 but kept the upper end unchanged at 10% growth for the fiscal. The company has guided for 9-10% growth in the year to March as against the previous expectation of 6-10%.

Infosys shares were trading at Rs 3290,up by 5.33% at 9.49 am on the Bombay Stock Exchange.

“During the quarter we witnessed broad-based volume growth,robust client additions,five large deal wins and increased sales momentum of our big data and cloud offerings. This growth is a result of our focus on execution,which helps our clients achieve their objectives.” said S. D. Shibulal,CEO and Managing Director,Infosys. “We will continue with planned investments and initiatives to explore new avenues of growth. We remain watchful of the sustainability of improving global economic fundamentals.”

Infosys added 68 clients during the second quarter (Q2) while its net addition of employees was 2,964.

“The global currency market remains volatile with the Indian rupee depreciating by 11% during the quarter. We have an active hedging program to minimize its impact on our margins. We will continue our focus on optimizing costs and enhancing the efficiency of our operations,” said Rajiv Bansal,Chief Financial Officer.

Infosys,which trails market leader Tata Consultancy Services by revenue,counts among its customers Bank of America Corp,BT Group PLC,Procter & Gamble Co and Volkswagen AG.

Several analysts said Infosys has set conservative revenue guidance that they expect it to beat.

“There’s still a lot of work to be done,but they’re turning around,” said Bhavin Shah,CEO of Equirus Securities.

“I think they’re seeing deal wins,client traction and revenue momentum. I’m sure Murthy is spending a lot of energy in sort of assuring clients that Infosys means business.”

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