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Infosys Q3 Results | Consolidated PAT rises 7.2% QoQ to Rs 5,809 crore, beats estimate –

Infosys, the country’s second-largest information technology firm by market capitalisation, on Wednesday, reported a 7.2 percent quarter-on-quarter rise in its consolidated net profit for the quarter ended December to Rs 5,809 crore.

The IT major also reported a 7.7 percent on-quarter rise in consolidated revenues to Rs. 31,867 crore for the reported quarter driven by the hybrid cloud partnership with German auto major Daimler announced in December 2020, the ramp-up of large deals and growth across verticals.

Infosys was expected to report a 4.5 percent quarter-on-quarter growth in consolidated revenues to Rs. 30,940 crore while its consolidated net profit was seen rising 5.2 percent on-quarter to Rs. 5,701 crore, according to a CNBC-TV18 poll.

“Our strong performance and market share gains are a testament to the enormous confidence our clients have in us to help them in their digital transformation,” said Salil Parekh, managing director and chief executive officer at Infosys in a press statement.

In constant-currency terms, Infosys’ consolidated revenues grew 7 percent sequentially.

The robust topline performance of the company further enabled the company to raise its revenue growth guidance for 2021-22 to 19.5-20.0 percent from 16.5-17.5 percent earlier.

“We expect the healthy technology spend to continue with large enterprises progressing on their digital transformations,” Parekh said. Infosys reported deal wins worth $2.53 billion in the reported quarter.

The Bengaluru-based company’s digital services sales continued to post strong growth as it rose 42.6 percent year-on-year in constant currency terms in the quarter ended December. The shares of digital revenues to overall sales also inched to 58.5 percent from 56.1 percent in the previous quarter.

On the operating front, the company’s consolidated operating profit grew 7.3 percent sequentially to Rs. 7,484 crore even as selling and marketing expenses climbed 7.3 percent on-quarter.

However, Infosys reported a 10 basis points quarter-on-quarter contraction in consolidated operating margin to 23.5 percent owing to continued costs towards trying to retain talent in the company.

The company’s struggles with high attrition continued in the December quarter as the voluntary attrition rate skyrocketed to 25.5 percent from 20.1 percent, a quarter ago.

“Despite the cost escalations driven primarily by supply-side challenges, we delivered another quarter of healthy margins, with improved cost optimization, continued operating leverage, and a stable pricing environment,” said Chief Financial Officer Nilanjan Roy.

During the reported quarter, Infosys added two new clients each in the $100 million-plus category and $50 million-plus category. Staff utilisation including trainees dipped to 82.7 percent from 84.1 percent in the previous quarter likely due to lower workdays in the quarter.

Among verticals, manuafcturing, life science, communication, and financial services posted robust year-on-year growth in sales. Geographically, North America reported 21.3 percent on-year growth and India saw 38.4 percent growth from the year-ago quarter.

Shares of Infosys ended 1.1 percent higher at Rs. 1,875.80 on the National Stock Exchange.