Infosys' Q3 revenue up 12% at Rs 10,424 crore

Infosys, on Friday, reported a marginal drop of 0.12 per cent in net profit to Rs 2,369 crore (Rs 23.69 billion) for the third quarter ended December 31, 2012.

However, the revenues (including that of acquired Swiss firm Lodestone) for the reported quarter were up 12.1 per cent to Rs 10,424 crore (Rs 104.24 billion) from Rs 9,298 crore (Rs 92.98 bilion) in the year-ago period, Infosys said in a BSE filing.

"We have done well in this quarter despite an uncertain environment.

"We continue to gain confidence from a strong
pipeline of large deals," Infosys CEO and managing director S D Shibulal said.

"However, the broader economic environment remains difficult. Even so, we remain cautiously optimistic about the
January-March quarter," he added.

. . .

The company had posted a net profit of Rs 2,372 crore (Rs 23.72 billion) for the October-December quarter of the previous fiscal (2011-12).

After slashing its revenue forecast earlier this fiscal, Infosys raised its rupee revenue forecast to be at least Rs 40,746 crore (Rs 407.46 billion) (from Rs 39,582 crore or Rs 395.82 billion earlier) and dollar revenue to be $7.45 billion (from $7.34 billion).

Reacting to the results, shares of Infosys soared 11.19 per cent to Rs 2,580 in early trade on the Bombay Stock Exchange.

In dollar terms, profit dipped by 5.2 per cent to $434 million in the reported quarter, but revenues were up by 5.8 per cent to $1,911 million in the quarter under review.

During the quarter, Infosys added 7,499 (gross) and 977 (net) employees taking the total headcount to 155,629.

. . .

Financial Highlights

• Revenues were Rs 10,424 crore (Rs 104.24 billion) for the quarter ended December 31, 2012;
• QoQ growth was 5.7%
• YoY growth was 12.1%
• Revenues excluding Lodestone were Rs 10,210 crore (Rs 102.1 billion);
• QoQ growth was 3.6%
• YoY growth was 9.8%
• Net profit after tax was Rs 2,369 crore (Rs 23.69 billion) for the quarter ended December 31, 2012, which remained unchanged compared to the quarter ended September 30, 2012
• Earnings per share was Rs 41.47 for the quarter ended December 31, 2012 against Rs 41.46 for the quarter ended September 30, 2012
• Liquid assets, including cash and cash equivalents, current available-for-sale financial assets, investment in certificates of deposits and government bonds were Rs 22,501 crore (Rs 225.01 billion) versus Rs 22,570 crore (Rs 225.7 billion) as on September 30, 2012.

. . .

Other highlights:

• The company won 8 large outsourcing deals amounting to US$ 731 million of total contract value
• 14 new wins for Infosys' products and platforms
• Infosys and its subsidiaries added 53 clients during the quarter
• Gross addition of 7,499 employees (net addition of 977) for the quarter by Infosys and its subsidiaries.
• 1,55,629 employees as on December 31, 2012 for Infosys and its subsidiaries
• Completed the acquisition of Lodestone Holding AG, a leading management consultancy based in Switzerland
• Infosys American Depositary Shares have started trading on the New York Stock Exchange under the ticker symbol 'INFY'. The company is in the process of listing its ADS on the Paris and London exchanges of NYSE Euronext.

. . .

Outlook

The company's outlook (consolidated) for the fiscal year ending March 31, 2013, under IFRS is as follows:

• Revenues are expected to be at least Rs 40,746 crore (Rs 407.46 billion);
• Earnings per share (EPS) is expected to be at least Rs 162.80;
• Conversion 1 $ = Rs 54.50 for rest of fiscal 2013

Includes Rs 568 crore (Rs 5.68 billion) from Lodestone

. . . 

The infosys results evoked a favourable response from business head honchos.

According to Partha Iyengar, Country Manager, Research, Gartner India, "Infosys results are finally coming closer to reflecting the demand reality, and if this sustains for the next two quarters could indicate that the worst phase of the company is behind it and it can stand to benefit from the strengthening demand environment.

"The upping of full year guidance is also a good sign for the company which shows some semblance of a return to confidence for the company, which was quickly becoming a 'negative outlier' amongst the Indian services majors", Iyengar said.

Dipen Shah, Head of PCG (Private Client Group) Research, Kotak Securities, said, "Infosys' 3Q results were above expectations.

"The organic revenue growth beat the guidance given by the company earlier. Margins were marginally lower v/s our expectations, though.

US and European economies are major revenue drivers for Indian IT companies.

"With greater stability expected in those economies, the velocity of decision making by clients may increase, which will be positive for Indian vendors.

"We also gain comfort from the management's indication that, there is a strong pipeline which Infosys has."