Confident of meeting guidance despite challenges: Infosys
Rajiv Bansal, CFO, says growth in Europe remains challenging, but macroeconomic data coming from US is encouraging.
India's second largest software services exporter Infosys says the environment remains challenging, but is confident of meeting its full year US Dollar revenue growth guidance of 6-10 percent.
The Bangalore-based company on Friday reported a better-than-expected consolidated net profit of Rs 2,374 crore, up 4 percent year-on-year in the first quarter. Revenue in Rupee terms rose 17 percent from a year ago to Rs 11,267 crore.
US Dollar revenue gained 14 percent to USD 1.99 billion.
The environment remains challenging and discretionary spends are slow, Rajiv Bansal, CFO, told moneycontrol.com in an interaction.
European markets remain challenging, growth in China is slowing, the currency is volatile and there is the regulatory overhang, he points out.
However, the US economy is looking better and the macro-economic data coming from the United States is "encouraging," Bansal added.
North America accounted for 61.4 percent and Europe 23.6 percent of Infosys' total revenue last quarter.
"Even if we have flat growth for the remaining quarters, we should end up at 7.7 percent growth for the full year," which is within its guided 6-10 percent range, he said.
Earlier in the day SD Shibulal, CEO, said, he was cautiously optimistic of the rest of the year, as deal pipeline remained strong.
Lodestone AG, the Zurich, Switzerland-based management consultancy Infosys acquired in 2012, also boosted growth. The company reported a net income of USD 1.88 million on revenue of USD 90.67 million in April-June, compared with a loss of USD 3.44 million on revenue of USD 70.33 million in Jan-March.
Bansal said that growth at Lodestone was as per plan and the company would be the single consulting face for Infosys in Europe.
There have been several media reports in the recent past, linking Infosys with potential acquisitions. Bansal refused to give specific names, but said the company continued to seek acquisition opportunities.
It had liquid assets including cash and cash equivalents, available-for-sale financial assets, and government bonds worth Rs 24,078 crore at the end of June.
Meanwhile, Bansal said that the company was closely watching developments related to the US immigration bill. The bill, if passed, could impact IT companies in a big way, he felt, but added that the passage of the bill was still a long drawn process and it was too early to talk about steps that companies, including Infosys, would have to take to lessen the impact.
The street cheered Infosys' better-than-expected results. The stock hit a high of Rs 2,905.60 on NSE on Friday. It closed at Rs 2,804.20, up close to 11 percent.