FY12 $ guidance downer: Is Infosys headed for re-rating?

Moneycontrol Bureau

Big boy Infosys reported a 33% rise in net profit at Rs 2,372 crore for the December-quarter, mainly on depreciating rupee but cut down its annual forecast indicating weak demand ahead for the Indian IT space.

The company revised its dollar revenue forecast for the full year ending March 2012 to 16.4% compared with 17.1 to 19.1% growth it expected in October.

While on rupee EPS, company has upgraded its FY12F guidance to Rs147.13 (YoY growth of 23.2%) versus current guidance of Rs143.0-145.3 given higher depreciation of rupee versus guidance for 3QFY12 and change in currency assumption to Rs 52 per dollar (CNBC-TV18 expectation was of Rs 53.1) versus earlier guidance of Rs48.98 for 4QFY12F.

According to Moshe Katri, MD, Cowen & Co, the last time Infosys had such an unimpressive sequential growth, it was probably in March of 2009 and this is when we were just getting out of the last downturn.

"It's more about the March quarterly guidance and the fiscal year guidance. In our view, a lot of it has to do with where we are on the budget cycle itself. In our view, and again that