Info-tech

Infosys Q1 revenue rises 14% with order boost

Our Bureau Bengaluru | Updated on July 12, 2019 Published on July 12, 2019

Infosys MD & CEO Salil Parekh with CFO Nilanjan Roy at a press meet in Bengaluru on Friday to announce the company’s Q1 results

It has increased its revenue growth guidance for FY20

Infosys on Friday reported a strong revenue growth in the first quarter as it bagged more orders, and raised its guidance for FY20.

The IT services firm raised its revenue growth guidance for FY20 to 8.5-10 per cent in constant currency. Last quarter, it had said it expected a revenue growth of 7.5-9.5 per cent in FY20.

Reacting to the result and revenue guidance, the ADRs of Infosys jumped 7.8 per cent at $11.56 in early trade on Nasdaq. They were quoting at $11.39 at 8.30 pm IST.

MD and CEO Salil Parekh said Infosys had a good start to FY20, aided by a strong deal pipeline and digital revenue growth of 41.9 per cent.

For the quarter ended June 30, it reported a total contract value of $2.7 billion, one of its highest. This follows the $1.6 billion in total contract value in Q4 FY19. “This, coupled with strong growth in digital revenues, is a positive,” said Sanjeev Hota, AVP - Research at Sharekhan by BNP Paribas.

Infosys reported Q1 revenues of ₹21,803 crore, a 14 per cent growth over the previous year period. On a sequential basis, its revenue grew 1.2 per cent from ₹21,539 crore.

Net profit rose 5.1 per cent year-on-year to ₹3,802 crore. However, on a sequential basis, it fell 6.8 per cent from ₹4,078 crore in the March quarter.

The quarter also saw Infosys’ margins go down to 20.5 per cent from 23.7 per cent in the June 2018 quarter.

The company reported a 23.4 per cent attrition rate, up from 20.4 per cent in Q4 FY19. “Elevated attrition numbers continue to remain a sour point for the company,” said Hota.

Payout allocation hike

Infosys has made some changes to its capital allocation policy. From the current policy of paying up to 70 per cent of free cash flow back to shareholders, it has increased the payout to 85 per cent. However, this additional 85 per cent will be paid cumulatively over a five-year period through a combination of semi-annual dividends and/or share buyback and/or special dividends.

The company said it is on track to complete its previously announced share buyback of ₹8,260 crore. Till date it has bought back shares worth ₹5,934 crore.

 

Published on July 12, 2019

A letter from the Editor


Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Support Quality Journalism
This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.