Kawaljeet Saluja, executive director, Kotak Institutional Equities, expects IT companies to deliver soft earnings as Q3 is a seasonally weak quarter.
Srikantan Moorthy, Senior VP & Group Head-Human Resource says on the issue of attrition, while on the last twelve months, or LTM, basis the attrition numbers are higher, on an absolute basis the numbers have come down over the last three quarters.
Srinivas, who has been recent elevated as the president of India‘s largest IT services exporter, added that the company‘s strong focus is on internal efficiencies and is trying to leverage efficiency factors to increase margins.
Nilesh Shah of Envision Capital feels that the stock could be in a consolidation zone and the recent highs itself will actually act as a significant resistance.
Though Ambit has upgraded Infosys‘s EPS estimates, it remains â€˜sell‘ on the stock as it doesn't see the company to be a growth leader. There has been top level attrition in Infosys of late.
Infosys management provides an insight into the company's third-quarter earnings, reasons behind the profit growth and its strategy ahead.
SD Shibulal, CEO, Infosys said the next fiscal is going to be an "exciting" one as client confidence is seen returning.
Infosys' profitability however, was impacted by visa cost of Rs 219 crore (one off item) in the quarter ended September 2013.
Nilesh Shah, Envision Capital says Infy might be one of the few companies with capacity utilization of less than 80 percent, but if it crossed 80 percent then it could lead to margin expansion.
According to Sushil Finance, revenues of Infosys are expected to increase by 2.5 percent Q-o-Q to Rs 13282.9 crore
Analysts will keenly eye the full year dollar revenue guidance (FY14), which if disappoints, could result in a knee-jerk reaction for the stock. According to Hitesh Shah, IT analyst of IDFC Securities, the street expects 11.5-12 percent revenue growth guidance for the full year.
Analysts believe the full year dollar revenue guidance (FY14) is the key to watch out for. According to them, if the company does not increase the guidance then the stock may see knee-jerk reaction.
According to ICICIdirect.com, revenues of Infosys are expected to increase by 0.5 percent Q-o-Q (up 25 percent Y-o-Y) to Rs 13,030.5 crore.
According to Motilal Oswal, sales of Infosys are expected to increase by 0.5 percent Q-o-Q (up 25 percent Y-o-Y) to Rs 13029.1 crore.
Ravi Menon, IT Analyst, Centrum Broking sees HCL Technologies outperforming and expect the stock to get re-rated. The broking firm has a price target of Rs 1,540 for the stock.
Financial results for the third quarter begin this week with Infosys Ltd reporting earnings on January 10.
AnandRathi Securities has come out with its earning estimates on IT sector. "Expect the top-four Indian IT companies to post 3.1% qoq, and 12.8% yoy, growth in USD revenue in 3QFY14," says the research firm.
According to Kotak Securities, revenues of Infosys are expected to increase by 0.3 percent Q-o-Q (up 24.7 Y-o-Y) to Rs 13,003.5 crore.
According to Ankur Rudra, the strength of beat by Cognizant is a big positive led by uptick in discretionary demand due to new technology and so, assuming that it is true for the entire (IT) sector is premature.
The big news though was Cognizant‘s upward revision of revenues for the full year. In Q2, 2013 the company had said that it expected revenues to come in at USD 8.74 billion, a growth of 19 percent compared to the previous year.
Ankita Somani, Analyst at Angel Broking is of the view that Wipro has been a laggard in terms of revenue growth among the top four IT companies.
IIFL India's Aniruddha Mehta feels that the July-September earnings announced by HCL Technologies disappointed on the valuations front. He feels that one can get slightly overweight on Infosys on good demand.
According to Ankur Rudra, HCL Technologies continues to look relatively inexpensive, just shy of 12-12.5 times and appears to offer more upside from re-rating perspective.
N Chandrasekaran, MD and CEO of TCS said that the pricing remained stable currently and that the company was aiming an operating profit margin of 26-28 percent.
Basu Banerjee expects atleast 15 percent upside on HCL Technologies from its current levels when compared to its largecap peers trading at much higher valuations.