Infosys Shares Tumble 9.4% On Q4 Profit Miss
India's second-largest IT services firm's fourth-quarter revenue fell 2.28% over the previous three months to Rs 37,441 crore.
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Shares of Infosys Ltd. tanked over 14%, the most in 42 months, on Monday after fourth-quarter profit missed analysts' estimates.
India's second-largest IT services firm's fourth-quarter revenue fell 2.28% over the previous three months to Rs 37,441 crore, according to an exchange filing Thursday. That compares with the Rs 38,770 crore consensus estimate of analysts tracked by Bloomberg.
The Bengaluru-based IT services firm has pegged its revenue growth guidance at 4-7% in the fiscal ended March 31, 2024. That compares with an average analyst estimate of 10.6% and 15.4% clocked in FY23, which too was a miss from the 16–16.5% guided earlier.
"The Q4 revenue growth was surprising and is likely to have a dampening effect on Infosys’ FY24 growth, particularly since it suggests a significant impact on the firm’s discretionary business due to the macro slowdown," Mukul Garg, research analyst at Motilal Oswal, said in an April 14 note co-authored by Pritesh Thakkar and Raj Prakash Bhanushali.
Infosys Q4 Results: Key Highlights (QoQ)
Revenue down 2.28% to Rs 37,441 crore (Estimate: Rs 38,770 crore)
EBIT down 4.42% at Rs 7,877 crore (Estimate: Rs 8,263 crore)
EBIT margin at 21.03% versus 21.5% (Estimate: 21.6%)
Net profit down 6.86% at Rs 6,134 crore (Estimate: Rs 6,582 crore)
Shares of Infosys closed nearly 9.4% lower at Rs 1,259 apiece, compared to 0.9% decline in the benchmark NSE Nifty 50. The stock dropped 14.68% intraday, the most in 42 months or 3.5 years since Oct. 22, 2019.
The lowest level in terms of price that the stock hit intraday was at Rs 1,185.30 the least in 28 months since Dec. 21, 2020.
The total traded volume so far in the stood at 24.3 times its 30-day average. The relative strength index was at 23, implying that the stock maybe oversold.
Out of the 49 analysts tracking the company, 32 maintain a 'buy' rating, nine recommend a 'hold' and eight suggest to 'sell' the stock, as per the Bloomberg data.
The average 12-month consensus price target implies an upside of 23.5%.
Source: Bloomberg, Exchange filing
