The company said its operating margins were at 23.7 per cent, at the upper quartile of the guidance. Large deal wins crossed $1 billion, of which over 40 per cent was from the financial services.
Hurt by a one-off charge related to fair value reduction of subsidiary Panaya, Infosys Ltd, India’s second-largest software services exporter, on Friday missed market estimate with a 3.7 per cent rise in quarterly profit at Rs 3,612 crore for the quarter ended June 2018 as against Rs 3,483 crore in the same period of last year. The net profit declined by 2.1 per cent from the March 2018 quarter. Infosys which is trying to dispose of Panaya, also announced a bonus issue of equity shares and stock dividend of American Depositary Shares in the ratio one for one. The company has recorded a reduction in the fair value amounting to Rs 270 crore in respect of the Panaya business, the company said in a statement.
The company also reported revenues of Rs 19,128 crore for the quarter ended June 2018, a growth of 12.0 per cent from Rs 17,078 crore a year ago. It also maintained its expectation for full-year revenue growth of between 6 to 8 percent. Infosys shares rose by 1.12 per cent to Rs 1309.10 on the BSE on Friday. Earlier this week, beating market estimates, TCS had posted 23.5 per cent rise in consolidated net profit to Rs 7,340 crore for the first quarter ended June 2018 as against a net profit of Rs 5,945 crore in the same period previous fiscal.
“The strong revenue and margin performance in this quarter show that our dual emphasis on Agile Digital and AI-driven Core services is resonating with our clients,” said Salil Parekh, CEO and MD. “With our Agile Digital business growing sequentially at 8 per cent in constant currency and increase in our large deal wins to over $ 1 billion, we see good traction in the market.”
The company said its operating margins were at 23.7 per cent, at the upper quartile of the guidance. Large deal wins crossed $1 billion, of which over 40 per cent was from the financial services. “Our emphasis on deepening client relationships resulted in strong client metrics including increase in the number of $100 million plus clients to 24,” said UB Pravin Rao, COO. “Utilisation excluding trainees reached an all-time high of 85.7 per cent.” Infosys’ digital revenues at $803 million (28.4 per cent of total revenues), showed a sequential growth of 8.0 per cent and year-on-year growth of 25.6 per cent in constant currency terms.
“We had broad-based financial performance on multiple fronts — RoE crossed 25 per cent, free cash flow was up 32 per cent quarter on quarter and operating margins were at the upper quartile of our margin guidance,” said MD Ranganath, CFO. “While we continue to make strategic investments to leverage the opportunities in Digital, our relentless focus on operational efficiencies continued in this quarter.”
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