NEW DELHI: Infosys is all set to kick off the December quarter earnings season this Friday. In rupee terms, the IT major is projected to report 6-8 per cent quarter-on-quarter (4-7 per cent YoY) profit growth. In constant currency terms, sales growth is seen in the 1.4-2 per cent range sequentially. Margins for the quarter may expand 40-50 basis points quarter on quarter, analysts said.

The Bengaluru-based company may report healthy order wins in an otherwise seasonally weak quarter. Some analysts even say the company may revise its FY20 revenue guidance.

Sharekhan expects Infosys to revise its lower end of the revenue guidance upward to 9.5 per cent (to 10 per cent) from 9 per cent (to 10 per cent). The brokerage expects the IT major to maintain margin growth guidance.

The brokerage expects the Bengaluru-based firm to report 3.5 per cent YoY (4.5 per cent QoQ) profit growth at Rs 4,201 crore and 8.3 per cent (2.4 per cent QoQ) sales growth at Rs 23,166 crore.

Edelweiss Securities expects the company to report 2.1 per cent sequential rise in sales in constant currency terms as cross-currency tailwinds from a strong pound will be almost fully offset by a weak euro. It sees Ebit margin at 22.2 per cent against 21.7 per cent QoQ and 22.6 per cent YoY.

“We expect EBIT margin to expand 50 bps QoQ, owing to a weak rupee and cost optimisation levers kicking in. Strong deal wins and robust pipeline should set Infosys up firmly on a sustained growth trajectory going forward. Commentary on digital growth rates, BFSI and progress on initiatives to manage attrition will be key things to watch for,” it said.

Prabhudas Lilladher advised investors to focus on the outcome for investigation on the whistleblower case, attrition levels, TCV pipeline momentum, revenue conversion of past deals and improvement in margins due to localisation efforts.





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