Expert views: Infosys Q1 profit up 33%, cuts guidance

Infosys Ltd , India's second-largest software services exporter, matched expectations with a 33% rise in its fiscal first-quarter profit, bolstered by a surge in demand for outsourcing services and a fall in the rupee.

However, the company cut its guidance for the full year and said global economic situation resulted in slower IT spending by its large clients.

India's $100 billion-a-year IT and back-office outsourcing sector earns about three-quarters of its revenues from customers in the United States and Europe, and faces intense competition from global rivals including IBM and Accenture .

COMMENTARY:

HARIT SHAH, SENIOR RESEARCH ANALYST, NIRMAL BANG INSTITUTIONAL EQUITIES, MUMBAI

"Everything is poor in Infosys results, and this kind of guidance cut will definitely materialise into further derating of the stock."

"One should expect more downgrades on Infosys in coming days on slumping demand. TCS (Tata Consultancy Services , however, will do better."

SURESH PARMAR, ASSOCIATE VICE PRESIDENT, INSTITUTIONAL EQUITIES, KJMC CAPITAL MARKETS

"The results and forecast are also not appealing. This will have a negative effect on the company. We see significant downside for the stock in the medium term."