Infy logs robust revenue, profit growth nos. in Q2

PAT leaps 9.8% y-on-y and 12.1% q-on-q to Rs 3,398 cr

Further fuelling its journey to achieve the $20-billion aspirational revenue target for 2020 set by CEO and MD Vishal Sikka, Infosys, the country’s second-largest software services exporter by revenue, on Monday logged robust growth in its profits and revenues during the second quarter ended September 30, 2015, beating market expectations.

The company’s net profit for the second quarter stood at Rs 3,398 crore, registering a growth of 9.8 per cent when compared with Rs 3,096 crore in the same period last year. The revenues of the company for the July-September period stood at Rs 15,635 crore, registering a growth of 17.2 per cent as against Rs 13,342 crore in the same period last year.

Commenting on the company’s performance for the quarter, Sikka said, “I am happy with the company’s performance. We are experiencing a once-in-a-generation opportunity for a services company to help businesses maximise their potential with technology. I am encouraged by our progress. While results in any one quarter are transitory snapshots of a long journey, we do see our focused execution, along with our strategy, starting to produce encouraging results for our clients, shareholders, and Infoscions,” he said.

On a sequential basis, the net profit of the company registered a growth of 12.1 per cent and revenues grew at  8.9 per cent. The earnings per share was Rs 14.87 for the quarter ended September 30, reporting an annual growth of 9.8 per cent.

In dollar terms, the revenues were at $2,392 million for the quarter ended September 30, witnessing a QoQ (sequential) growth of six per cent. Net profit was sequentially up 9.1 per cent at $519 million.

Infosys COO UB Pravin Rao said the company reported strong all-round growth during the quarter, driven by recent initiatives around service differentiation, improvement in client mining, and higher focus on winning large deals.

“Increase in revenue productivity was significant, volume growth was robust, client metrics and utilisation improved, while attrition remained stable,” he added.

Rao said even though BFSI registered two good quarters and there was some amount of softness from the financial side, the company is facing more than the usual cost pressure in the BFSI sector.

Low $ revenue guidance
The company has lowered its FY16 dollar revenue guidance to 6.4-8.4 per cent from the 7.2-9.2 per cent given in July. Infosys, however, maintained constant currency rupee guidance at 10-12 per cent growth for FY 2015-16.

The lowering of guidance is attributed mainly due to the fact that the broad weakness in IT spending and a stronger dollar are making clients wary. But Sikka referred to the constant currency guidance and said, “I have now today repeated this 11 times and now for the 12th time that there is no change or reduction to the guidance.”

During the quarter, the company signed five large deals with a TCV (total contract value) of $983 million. Infosys also added 82 new clients, taking the total number of active clients to about 1,000.

The company added 8,453 employees in the said period from the June 2015 quarter, taking its total headcount to 1,87,976 as of September 30, 2015. But the company’s attrition level increased to 19.9 per cent in the second quarter, compared with 19.2 per cent in the June quarter. It was 24.8 per cent last year.

Giving cheers to investors, Infosys declared an interim dividend of Rs 10 per share. Infosys shares closed down 3.88 per cent at 1,122.5 at the BSE on Monday.

Liquid assets, including cash and cash equivalents, available-for-sale financial assets, and government bonds were Rs 32,099 crore as on September 30, 2015.