INFOSYS Q2 RESULT UPDATE:14 OCT 2016

Infosys September quarter results remained a mixed bag as it reported net profit which was more than estimates, but lowered guidance for the second quarter in a row, pulling the stock into negative territory.

The IT bellwether on Friday reported a 4.95 per cent quarter-on-quarter (QoQ) rise in net profit to Rs 3,606 for the quarter ended September 30. The second largest domestic IT firm by sales had reported a net profit of Rs 3,436 crore in June quarter.

The numbers were a tad better than Street estimates, given the firm had already informed stock exchanges of challenges it was facing, owing to ramp down in RBS contract and other client specific issues.

However, the company lowered its revenue guidance (constant currency) for FY17, which hurt the sentiment.

The company said its net sales stood at Rs 17,310 crore for the quarter against Rs 16,782 crore revenue it reported in the June quarter

Dollar revenue for the quarter stood at $2,587 million (constant currency), up 3.9 per cent QoQ against $2,501 million in June quarter.

Net profit was up 5.5 per cent sequentially to $539 million.

Revenue Guidance:

The IT major revised its FY17 revenue guidance to 8.0%-9.0% in constant currency terms for the second time this financial year. This constant currency guidance translates to 8.2% - 9.2% in dollar terms based on March 31st rates, 7.5% - 8.5% based on June 30th rates and 7.5% - 8.5% based on September 30th rates.

The company cut its FY17 revenue guidance (constant currency) for second time this year to 8-9 per cent against 10.5-12 forecast earlier. This was largely in line with Street expectations. Dollar revenue guidance was lowered to 7.5-8.5 per cent from 10-11.5 per cent earlier.

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