InvestorQ : What is your quick take on the Infosys results announced on 13th April evening?
Debbie Mascarenhas made post

What is your quick take on the Infosys results announced on 13th April evening?

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Arti Chavan answered.
1 month ago
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For the Mar-22 quarter, Infosys reported 22.67% higher sales at Rs.32,276 crore. BFSI contributed Rs.10,096 crore, Retail Rs.4,617 crore and Communications Rs.4,132 crore to the top line. BFSI generated most of the EBITDA for Infosys at Rs.2,578 crore. In terms of guidance for FY23, Infy has provided 13-15% revenue growth guidance and 21-23% operating margin guidance. Here is a gist of the numbers

Infosys Ltd

Rs in Crore

Mar-22

Mar-21

YOY

Dec-21

QOQ

Total Income (Rs cr)

₹ 32,276

₹ 26,311

22.67%

₹ 31,867

1.28%

Operating Profit (Rs cr)

₹ 6,956

₹ 6,440

8.01%

₹ 7,484

-7.06%

Net Profit (Rs cr)

₹ 5,686

₹ 5,076

12.02%

₹ 5,809

-2.12%

Diluted EPS (Rs)

₹ 13.54

₹ 11.94

₹ 13.83

OPM

21.55%

24.48%

23.49%

Net Margins

17.62%

19.29%

18.23%

Even as the company guided for robust operating margins of 21-23% in the coming year, the current quarter OPMs came under pressure at 21.5% (lower 300 bps yoy). This was largely on account of higher manpower and attrition costs. In Q4, the digital revenues accounted for 59.2% of revenue mix with CC growth of 38.8% yoy. Free Cash Flows (FCF) for the Q4 for Infosys stood at $761 million but full year FCF conversion into net profit was 102.9%.

Net profits post tax for Mar-22 quarter increased 12.02% at Rs.5,686 crore. The revenue growth was partially neutralized by the pressure on operating numbers. This pressure was on account of higher costs on the employee and attrition front with the attrition rate for Infosys going to an uncomfortably high level of 28% in Q4. In the Q4, total contract value (TCV) of large deals stood at $2.3 bn for the quarter with full year TCV pegged at $9.5bn.

There was generous distribution of profits. Infosys declared final dividend of Rs.16 per share and total dividend of Rs31 per share for FY22. It distributed Rs13,000cr as dividends to shareholders. The 2 major geographies for Infosys remain North America yielding 61.4% of revenues and Europe giving 25.2% of revenues in Q4. PAT margins tapered from 19.29% to 17.62% yoy in Q4. Sequential net profit margins were lower by 61 basis points.

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