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INFY - Infosys News Story

$18.11 -0.3  -1.4%

Last Trade - 6:55pm

Large Cap
Market Cap £54.42bn
Enterprise Value £52.42bn
Revenue £9.69bn
Position in Universe 166th / 6853

UPDATE 3-India's Infosys falls over 5% on profit miss, attrition worries

Thu 15th April, 2021 6:23am
(Changes dateline, adds analyst comment and share movement)
    By Sankalp Phartiyal and Sethuraman N R
    NEW DELHI/BENGALURU, April 15 (Reuters) - Infosys Ltd shares
 INFY.NS  fell as much as 5.5% on Thursday, a day after the
Indian software services firm reported quarterly net profit
below analysts' estimates and on worries that a spike in
voluntary attrition could squeeze margins.
    The Bengaluru-headquartered company posted a 17.5% rise in
net profit to 50.76 billion rupees ($675.4 million) in the three
months to March 31. Analysts had estimated a profit of 51.93
billion rupees, according Refinitiv data.
    The sharp increase in attrition is a cause of worry and
could be a risk to the top end of margin guidance, Investec
analysts said in a note.
    On Wednesday, Infosys Chief Executive Officer Salil Parekh
said in a call with reporters that the company was targeting
margins of 22% to 24% for the full year 2021-22.
    Infosys reported a voluntary attrition rate of 15.2% for its
IT services segment during the March quarter, up from 10% in the
preceding quarter.  
    "Considering the strong deal momentum, a continued increase
(in attrition) would require higher lateral additions and
potentially meatier salary increases to retain talent," Investec
    In addition to employee costs, Infosys will also have
transition costs from large deals and return of some expenses
which were saved because of the COVID-19 pandemic, Investec
analysts said. 
    On Wednesday, Infosys forecast annual revenue growth of 12%
to 14% in constant currency terms for the year to end-March
2022, buoyed by client demand for its digital services during
the pandemic.
    Quarterly revenue rose to 263.11 billion rupees from 232.67
billion rupees a year earlier. 
    The company recommended a final dividend for the year of 15
rupees per share, and approved a share buyback of up to 92
billion rupees.
    Bigger rival Tata Consultancy Services  TCS.NS  on Monday
posted a 15% jump in profit on cloud services demand, while
smaller counterpart Wipro  WIPR.NS  will report results later on
($1 = 75.2930 Indian rupees)

 (Reporting by Sankalp Phartiyal in New Delhi; Additional
reporting by Shivani Singh and Chris Thomas in Bengaluru;
Editing by David Goodman, Jan Harvey and Subhranshu Sahu)
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