INSUBCONTINENT EXCLUSIVE:
ET INTELLIGENCE GROUP: The December quarter performance of Infosys was a mixed bag
visible revival in the major verticals of financial services and retail, which together contributed 47% to the total revenue in the
quarter.
The favourable outcome of the internal audit committee regarding the whistle blower allegations will be a near-term positive for
The audit committee assisted by an independent legal counsel has concluded that there was no evidence of financial impropriety or misconduct
Infosys also faces class action lawsuits by stockholders in the US
In addition, Indian regulatory authorities have sought information from the company on the matter.
On the operating front, the company
reported a strong $1.8 billion worth of large deals for the December quarter
The employee attrition rate at 19.6% fell for the second consecutive quarter.
Revenue from the fast growing digital offerings rose by 40%
It formed 40.6% of the total revenue of $3,243 million compared with 31.5% in the yearago quarter.
An analysis of the trailing 12-month
(TTM) incremental revenue in dollar terms in each of the past few quarters reveals that the company has shown a sustained momentum since the
September 2017 quarter when it had hit a low of $558 million.
Over the next two years, it gradually grew to $1.1 billion in the December
The year-onyear growth rate of the TTM revenue also improved to 9.5% from 5.6% in the said period.
What may cause some concern is the
continued weakness in the finance vertical, which constituted 31.5% of the total revenue in the third quarter
It revenue grew at a slower pace of 6.2% year-on-year compared with the 10.3% growth in the previous quarter
earlier 9-10% growth may not prompt analysts to make major revisions to earnings estimates.
The stock recovered to Rs 738.3 on Friday from
Rs 643.3 on October 22 in a reaction to the whistle blower complaints
It was trading above Rs 770 before the allegations
this level in the short term.
Whether it is able to sustain it will depend upon measures taken by the company to improve operating
profitability and revive the growth of finance and retail verticals.
