Infosys, one of India’s largest IT service companies, has announced its financial results for the fourth quarter of the fiscal year. The company’s net profit dropped by 12% compared to the previous year, reaching ₹7,033 crore. This decline is primarily due to lower than expected revenue growth.
In the recent quarter, Infosys reported revenues of ₹40,925 crore, which is an 8% increase compared to ₹37,923 crore in the same period last year. However, analysts had expected better performance, and this led to disappointment in the market.
Brokerages such as Nuvama and Emkay Global have responded to the news by lowering their target prices for Infosys shares. Nuvama has cut its target from ₹1,870 to ₹1,700, while Emkay reduced its target from ₹1,900 to ₹1,650. Despite this, both brokerages continue to recommend buying the stock, citing potential for growth from new business deals.
Infosys has provided cautious guidance for the next fiscal year, predicting revenue growth of 0% to 3% in constant currency. The company also expects an operating margin of 20% to 22%. Management has attributed part of the revenue decline to lower business volume and seasonal factors, as well as changes in contracts.
Despite the challenges, Infosys reported that it secured new contracts worth $2.6 billion. However, company officials noted that many clients are currently cautious due to global economic uncertainties.
Overall, while Infosys is experiencing challenges, its focus on large contracts and strategic adjustments may help it recover in the future.
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