Infosys shares surged as much as 6.86 per cent on Friday after India's second largest outsourcer beat earnings estimate in the December quarter. Analysts said Q3 results bear the imprint of new chief executive Vishal Sikka, who is the first non-founder head of Infosys.
Infosys reported a profit of Rs 3,250 crore on sales of Rs 13,800 crore in the quarter ended December 31, 2014. Brokers polled by NDTV estimated Infosys to report a net profit of Rs 3,151 crore on sales of Rs 13,760 crore.
The big boost was the maintenance of annual sales growth guidance at 7-9 per cent. Most analysts had expected Infosys to revise growth outlook downwards because of strength in the US dollar, which has hit revenues for most Indian IT firms.
Market analyst Ambareesh Baliga told NDTV that maintenance of growth guidance is good news for investors. "Infosys result raises the bar for other IT companies that are yet to come out with numbers," Mr Baliga added.
Infosys also topped analyst estimates on other operational parameters. Operating margins jumped to 26.7 per cent in the December quarter as against 26.1 per cent in the previous quarter. Volume growth at 4.2 per cent was the highest in three years, while employee utilization was highest in 11 years.
"No doubt, it is a good set of numbers, we are pretty happy," said Dhananjay Sinha of Emkay Global.
Infosys also announced 100 per cent variable bonus for its employees. Chief financial officer Rajiv Bansal said attrition is down 3 per cent on a quarter-on-quarter basis though annualized attrition remained above 20 per cent in the December quarter.
"Out initiatives are paying off and we are in the right direction," Mr Bansal added.
Infosys was the top gainer in the 50-share Nifty index and drove markets higher. Other IT stocks also gained sharply post Infosys result announcement. The IT sub-index jumped 4 per cent, outperforming the broader Nifty, which was up just 0.5 per cent.
This is the first time Infosys, India's second biggest outsourcer, has reported its quarterly numbers during market hours.
The December quarter is seasonally weak because of holidays in the key markets of North America and Europe, but Infosys seems to have bucked the trend, analysts say.
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