Infosys profit grew 16.2 per cent in the three months ended March, the fastest pace in six quarters as deal wins, benefits accruing from automation and digital services, and acquisitions helped boost revenue. Sales grew 23.4 per cent, the biggest jump in nine quarters.
The company also forecast full-year revenue growth in dollar terms of between 11.8 per cent and 13.8 per cent, which is higher than Nasscom’s estimate for the overall industry. The projection signals that Infosys is back on track to reclaim the bellwether tag.
For the quarter, the IT major’s net profit stood at Rs 3,597 crore, a 16.2 per cent increase over the same period last year. On a sequential basis the profit witnessed a growth of 3.8 per cent. Infosys’ revenues for the quarter stood at Rs 16,550 crore registering a growth of 23.4 per cent over the same period last year.
“Our growth trajectory improved in FY 16 and we navigated the external business environment well. We will continue to focus on leveraging operational efficiency levers for consistent profitable growth.” said M.D. Ranganath, Chief Financial Officer, Infosys. The operating profit witnessed a growth of 22.4 per cent and stood at Rs 4,220 crore when compared to the same period last year. The company witnessed a volume growth of 2.4 per cent in the fourth quarter.For the full year ended March 31, 2016, total revenues were Rs.62,441 crore registering an annual growth of 17.1 per cent. Net profit stood at Rs.13,491 crore, a growth of 9.4 per cent, while operating profit was Rs 15,620 for the year.
Commenting on the performance of Infosys, Arup Roy, Research Director, Gartner said, “The results are a clear indication that Infosys has turned around the ship and that it has a solid growth story ahead. The guidance is also in line with the industry, in fact on the higher side.”
For the fiscal ending March 31, 2017, Infosys has given . The company’s revenue growth guidance for 2016-17 in U.S. dollars terms is 11.8-13.8 per cent, which is higher than industry body Nasscom’s prediction of 10-12 per cent. “The continued adoption of new technology areas such as automation and high-margin digital services, renewal initiatives around our Zero Distance Program, traction in our acquisitions Panaya and Skava, and deal-wins, give us additional tailwind for this year,” said Mr Vishal Sikka, CEO & Managing Director, Infosys.
However, the company is also seeing downward pressure on pricing. “There is a general downward pressure in the industry on pricing of traditional services and some margin decline (last year) was due to that. Some new initiatives were also impacted by pricing,” said Sikka.
In the January-March quarter, revenue from banking, financial service and insurance (BFSI), a major contributor to the company’s topline dropped 0.3 per cent sequentially due to ramp downs in one of the large clients in the insurance vertical.
On a geographical basis the company’s India revenue witnessed a growth of 9.1 per cent while the major market North America grew 0.5 sequentially.
The Board of Directors recommended a final dividend of Rs 14.25 per share for fiscal 2016. Infosys also announced the appointment of Mr. Mohit Joshi, Mr. Ravi Kumar S and Mr. Sandeep Dadlani as the presidents of the company effective immediately. Prior to the elevation, they were all executive vice-presidents.
