Business

Infosys net surges 23%, firm raises guidance

Large deal wins worth $1.8 bn signed

Infosy said its overall performance for the third quarter, ended December 31, was ‘satisfactory’ on multiple counts: broad-based growth, steady increase in client metrics and large deal wins worth $1.8 billion.

The firm has witnessed a 23% year-on-year rise in its net profit for the quarter. Net profit rose to ₹4,466 crore compared with the ₹3,610 crore in the corresponding period a year ago.

Total revenue for the third quarter grew by 7.9% to ₹23,092 crore, up from the ₹21,400 crore in the year-earlier period.

Operating profit up

Operating profit stood at ₹5,064 crore during the quarter, an increase of 4.8% year-on-year (YoY). The quarter saw its operating margin improving by 20 basis points to 21.9% compared with the previous quarter.

Infosys CEO and MD Salil Parekh said, “[The] Q3 results further underscore that we remain steadfast in our journey of sustained client relevance and deepening engagement with them, as they partner with us in navigating their next in the digital transformation era. For us, this has translated into double-digit growth year-to-date, leading to an increase in revenue guidance, accompanied by expanding operating margins.”

Infosys posted a cumulative revenue of ₹67,524 crore and an operating profit of ₹14,447 crore, a YoY growth of 10.4% and 1.3% respectively, in the last nine months of the current fiscal.

COO U.B. Pravin Rao said, “large deal wins continue to be robust with a growth of 56% so far this year.’’

Commenting on operating margins, CFO Nilanjan Roy said, “Operating margins improved further during the quarter, driven by relentless cost optimisation and operating leverage. Cash generation was extremely strong with cumulative free cash flow crossing $1.5 billion.

“Return on equity increased further to 25.9%, driven by margin expansion and increased shareholder payouts.” The firm revised its FY20 revenue outlook upwards to 10-10.5% in constant currency. Operating margin guidance was maintained in the 21-23% range.

In Q3, digital revenue accounted for 40.6% of the firm’s total revenue, against 38.3% in the previous quarter and 32.5% in the corresponding quarter a year ago.

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Printable version | Feb 23, 2020 2:19:21 PM | https://www.thehindu.com/business/infosys-net-surges-23-firm-raises-guidance/article30537438.ece

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