Infosys Ltd, India's second-largest software services exporter by revenue, reported a bigger-than-expected 6.6 percent increase in quarterly net profit as it won more clients and as a weaker rupee helped.
In further evidence of a confidence boost, the company also raised its FY16 revenue guidance, sending shares of the company soaring nearly 5 percent on the BSE in a weak market.
Consolidated net profit rose to Rs 3,465 crore ($516.5 million) in its fiscal third quarter to December 31, from Rs 3,250 crore a year earlier, the Bengaluru-headquartered company, which counts Apple Inc, Volkswagen AG and Wal-mart Stores Inc among its clients, said in a statement.
Sequentially, the profit rose 1.94 percent and revenue 1.7 percent.
Analysts polled by CNBC-TV18 had expected profit to decline 2.9 percent sequentially to Rs 3,300 crore and revenue to rise 0.7 percent to Rs 15,748 crore.
Dollar revenue, which was seen flat at $2,390 million on sequential basis, 0.6 percent to $2,407 million from $2,392 million.
The company has raised the FY16 revenue guidance to 12.8-13.2% in constant currency and 8.9-9.3% in dollar terms based on 31 December 2015 exchange rates, it said in a press release.
"Alongside grassroots innovation, we continue to see growing adoption of our Aikido services, bringing the power of intelligent systems, automation and software to amplify the skills and imaginations of our people. This combination helped us deliver encouraging results despite the traditional seasonality of the quarter and the additional headwinds, and will strengthen the execution of our strategy towards consistent profitable growth."," says Vishal Sikka, CEO and MD in a press relase.
"We are seeing Infosions becoming innovators, bringing innovation and client value to each individual project. This confidence can only come from a culture of learning and empowerment, and this is the kind of company we are endeavoring to create," he further said.
"We have been able to navigate the quarter better than our earlier expectations. We will continue to focus on enhancing operational efficiency through multiple levers in the coming quarters," said CFO M D Ranganath.\
The management commented that the lower realisations has impacted its margins which stood at 24.9 percent during the quarter, a sharp fall from 25.5 percent a quarter ago.
The officials said the company's deal pipeline stands at $3 billion and it is potentially close to winning a $600 million deal. Infosys has added a total of 75 clients on a gross basis during the quarter.
The company's staff utlisation rate, including trainees, during the quarter stood at 74.2 percent, lower than 75.4 percent a quarter ago. The officials are of the opinion that there is scope to improve utilisation further.
Consolidated attrition, a major nightmare for the company, has declined to 18.1 percent from 19.9 percent a quarter earlier.
Its liquid assets including cash and cash equivalents, available-for-sale financial assets and government bonds were at Rs 31,526 crore as on December 31, 2015 as compared with Rs 32,099 crore as on September 30, 2015.
With inputs from Reuters