Infosys Q1 profit grows 11.5% to ₹4,272 crore
Infosys is back at giving guidance after postponing it for a quarter with the revenue forecast in the range of 0-2 per cent in constant currency.
The operating margin for FY 21 has been forecast to be in the range between 21 per cent and 23 per cent.
The IT services’ company also said that it recorded an 11.5 per cent increase in net profit to ₹4,272 crore for the first quarter of FY21 on a year-on-year basis on the back of large deal wins.
The company’s revenues rose 8.5 per cent to ₹23,665 crore. Its large deal signings were $1.74 billion for the last quarter.
“Our Q1 results, especially growth, are a clear testimony to the relevance of our service offerings and deep understanding of clients’ business priorities which is resonating with them in these times. It also demonstrates the remarkable dedication of our employees and leadership during this period”, said Salil Parekh, CEO and MD. “Our confidence and visibility for the rest of the year are improving driven by our Q1 performance and large deal wins.” On pricing, Parekh said, there was some level of impact and not broad-based with some discounts very narrowly in retail and manufacturing.
The operating profit was ₹5,365 crore, which was a growth of 20 per cent year-on-year and 8.9 per cent Q-o-Q. The operating margin was 22.7 per cent with the basic EPS was Rs 9.98, a growth of 13.1 per cent year-on-year and a decline of 2 per cent Q-o-Q.
The digital revenues were at $1.38 billion which is 44.5 per cent of total revenues with a year-on-year growth of 25.5 per cent in constant currency. The free cash flow saw a year-on-year growth of 63.5 per cent to ₹5,524 crore. Voluntary attrition for IT services declined to 11.7 per cent from 20.2 per cent in Q1 FY’20.
“During the last few months, we took multiple steps aimed at employee safety and well-being while providing seamless services to our clients. Clients have recognized us for the speed, security and effectiveness of our remote enablement efforts”, said Pravin Rao, COO.
“The strength and diversity of our portfolio were evident in good revenue performance, sizeable large deal wins, high focus on operating metrics and significant decline in attrition.” he added.
The company also said it has appointed Bobby Parekh as an independent director on its board.
“Operating margin expanded to 22.7% driven by the preemptive deployment of our strategic cost levers along with tactical opportunities triggered by the COVID situation. Collections were robust and capex was focused, which led to 50 per cent year-on-year increase in Free Cash Flows. Our liquid and debt-free Balance Sheet is a huge source of strength in these times,” said Nilanjan Roy, CFO.