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Infosys Q2 PAT jumps 20% YoY to Rs 4,845 cr

The IT major's consolidated net profit jumped 20.5% to Rs 4,845 crore on a 8.6% rise in revenues to Rs 24,570 crore in Q2 September 2020 over Q2 September 2019.

Sequentially, consolidated net profit rose 14.4% and revenue increased 3.8% in Q2 September 2020 (Q2FY21) over Q1 June 2020 (Q1FY21). Consolidated profit before tax (PBT) stood at Rs 6,750 crore in Q2 FY21, gaining 16.5% from Rs 5,792 crore in Q1FY21. Total tax expense rose 24.5% to Rs 1,892 crore in Q2 FY21 over Q1 FY21. The result was announced after market hours today, 14 October 2020.

Operating profit jumped 16.1% to 6,228 crore in Q2 FY21 over Q1 FY21. Operating margin stood at 25.3% in Q2 FY21, higher than 22.7% in Q1 FY21.

The company has revised FY21 growth guidance upward to 2% to 3% in constant currency term. Operating margin for FY21 is also revised upward in the range of 21% to 23%.

The company announced large deal wins worth $3.15 billion during the quarter. Infosys' Q2 revenue grew year-on-year by 3.2% in dollar terms and grew by 2.2% in constant currency. Digital revenues were at $1,568 million (47.3% of total revenues), year-on-year growth of 25.4% in constant currency.

Free cash flow stood at Rs 4,989 crore with a year-on-year growth of 78.1%. Consolidated cash and cash equivalents were at Rs 33,601 crore as on 30 September 2020 compared with Rs 28,674 crore as on 30 June 2020 and Rs 23,733 crore as on 30 September 2019.

The company will roll out salary increases, promotions across all levels with effect from 1 January. The attrition rate for Q2 September 2020 declined to 7.8% against 18.3% in last fiscal. Infosys had 2,40,208 employees as of 30 September 2020 as against 2,36,486 in the same period last year.

Commenting on the performance, Salil Parekh, CEO and MD said, "Our second quarter performance is a clear reflection of our ability to help clients on their digital transformation journeys. Our digital and cloud capabilities combined with intense client relevance are helping us achieve differentiated results in the market as is visible in 2.2% year on year overall revenue growth and 25.4% growth from digital offerings, which now are at 47.3% of revenues."

Nilanjan Roy, CFO said, "Our relentless efforts on cost optimization and strengthening operational efficiencies helped by certain cost deferrals led to 270 bps sequential improvement in operating margin to 25.4% and a 300 bps improvement in H1 margins."

Infosys declared an interim dividend of Rs 12 per equity share. It fixed 26 October 2020 as record date for interim dividend and 11 November 2020 as payment date.

Shares of Infosys fell 1.89% to Rs 1136.10 today. Infosys is a global leader in next-generation digital services and consulting.

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