Akash Jain
There might be knee jerk reaction from market participants as management of Infosys has lowered the revenue guidance which can be used as a good buying opportunity.
We believe the turbulent times for Infosys are over after the exit of its ex CEO and expect it to do well under the new CEO. We do not have price target as of now but will get more clarity on its future strategy after the analyst meet on April 23, 2018.
Outlining the strategy, the firm's CEO Salil Parekh on Friday said Infosys will focus on four pillars - scaling digital business (USD 2.79 billion in revenue currently), energising client's core technology landscape via artificial intelligence and automation, re-skilling employees, and expanding localisation in markets like US, Europe, and Australia.
In Q4FY18, the company’s topline in dollar terms, was up 1.8 percent sequentially (9.2 percent year-on-year, or Y-o-Y). Revenue in constant currency terms was up 0.6 per cent sequentially (6.4 percent Y-o-Y). The 24.7 percent operating profit margin, which was 30 basis points (bps) more than expectation, came as a surprise. Net profit, however, was weighed down by write-offs of Rs 1.18 billion, pertaining to earlier acquisitions, which are now on the block.
Disclaimer: The author is Vice-president, Equity Research at Ajcon Global Services. The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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