Infosys on Thursday surpassed Street estimates when it reported an 11.46 per cent growth in net profits for the third quarter ended December 31, amid a pickup in key business segments such as financial services.
The country’s second largest IT services firm posted a net profit of ₹6,806 crore compared with ₹6,106 crore in the corresponding period of the previous year.
The Bengaluru-based company raised its revenue growth forecast for this fiscal, backed by the better-than-expected performance in an otherwise seasonally weak quarter. The improvement in demand for financial services, retail and consumer products also boosted sentiments at the IT major.
Infosys said it expects a revenue growth of 4.5-5 per cent in constant currency terms, up from 3.75-4.5 per cent guidance provided in the second quarter. This is the third time that it is bumping up the revenue growth forecast, which indicates that the demand environment is gradually improving.
In the first quarter, it had given a metric of 3-4 per cent.
The net profit of ₹6,806 crore was above analyst expectations of around ₹6,700 crore. Revenues came in at ₹41,764 crore against ₹38,821 crore in the year-ago period — a rise of 7.58 per cent.
A consensus estimate of analysts polled by Bloomberg had pegged the number at
₹41,331 crore.
“Our strong revenue growth sequentially in a seasonally weak quarter and broad-based year-on-year growth, along with robust operating parameters and margins, is a clear reflection of the success of our differentiated digital offerings, market positioning, and key strategic initiatives,” said Salil Parekh, CEO and MD, Infosys.
Speaking to the press, Parekh added that all of its customer verticals grew over the previous year period. He pointed out that financial services in the US continues to grow and that Infosys is also witnessing a revival in Europe as well. He disclosed that the company also saw an improvement in segments such as retail and consumer products and that the pressure on discretionary spending was easing.
In terms of revenues by business segments, financial services saw a rise of 6.1 per cent in constant currency terms, while it stood at 10.7 per cent for manufacturing, 8.6 per cent for energy, utilities, & services.
High-tech notched a growth of 8.4 per cent, while it stood at 6.3 per cent in the case of life sciences.