Infosys net profit rises in Q1 — What worked for the second-largest IT firm

Infosys on Friday kicked off the new financial year on a strong note, even as rival Tata Consultancy Services (TCS) reported a soft quarter. Not only has the company bumped up its revenue guidance for the full financial year, it has also decided to distribute 85% of free cash-flows to shareholders through dividends and buybacks over a period of five years against 70% earlier. Analysts believe that the June quarter’s performance should drive up consensus estimates for the full year.

The country’s second largest IT services company bumped up its guidance for the fiscal to 8.5-10% from the from 7.5-9.5%, on the back of its strong performance. The company’s net profit increased 5.3% on a year-on-year basis, while it declined 6.8% sequentially to Rs 3,802 crore. Revenues for the quarter ended June 2019 grew by 14% year-on-year and 1.2% sequentially to Rs 21,803 crore. In constant currency, revenues rose 12.4% y-o-y and 2.8% sequentially. The company has also signed large deals worth $2.7 billion, which is the highest so far. The company had exited FY19 with total contract value of $6.28 billion.