Infosys has rallied over 3% to Rs 3,660, also its record high on the Bombay Stock Exchange (BSE). Shares of the country’s second-largest software services provider has surged 6% in past two trading sessions after posting 145bp quarter-quarter (qoq) growth in EBIT margin to 25.0% for the third quarter ended December 2013 (Q3), led by operational efficiency with higher utilization level and sequential decline in S&M spends. The company expects margins to stabilize around the current levels in the medium to long term.
The company expects the client budgets to be flat from last year, but the business environment to improve gradually. The deal pipeline has seen steady improvement over the last 4-5 quarters that could be attributed to better macro-economic environment and increased focus on traditional Business IT.
Meanwhile, Infosys has revised its USD revenue growth guidance for FY2014 to 11.5-12% (expectation: 11-12%) from 9-10% given earlier, implying 1.4% qoq USD revenue growth in 4QFY2014 to meet the upper end of guidance which seems attainable, says analyst at Angel Broking in a note.
The company expects the client budgets to be flat from last year, but the business environment to improve gradually. The deal pipeline has seen steady improvement over the last 4-5 quarters that could be attributed to better macro-economic environment and increased focus on traditional Business IT.
Meanwhile, Infosys has revised its USD revenue growth guidance for FY2014 to 11.5-12% (expectation: 11-12%) from 9-10% given earlier, implying 1.4% qoq USD revenue growth in 4QFY2014 to meet the upper end of guidance which seems attainable, says analyst at Angel Broking in a note.
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