Q4 preview: Infosys may report Y-o-Y double-digit revenue and net profit growth in rupee terms

MUMBAI: Despite seasonal weakness, a marginal uptick in the business momentum and weaker rupee are expected to help Infosys clock better revenue growth for the March 2016 quarter.

On April 15, the country’s second largest software exporter will declare financial performance for the March 2016 quarter. According to the average of estimates by seven brokerages and ET Intelligence Group’s forecast, revenue is expected to grow sequentially by 4.3% to Rs 16,583.2 crore compared with 1.7% growth in the previous quarter. Net profit will grow by a tad 0.7% to Rs 3,487.8 crore, slower than 2% increase in the December 2015 quarter.

Compared with the year-ago period, growth in revenue and net profit is expected to be strong at 23.7% and 12.6% respectively.

Also Read: Infosys Q4 results: Five things to watch out for


The dollar denominated revenue is likely to increase by 2-2.2% sequentially in the March 2016 quarter, much faster than 0.6% growth in the previous quarter. The higher growth in the rupee denominated revenue will be on account of weaker rupee. During the quarter, the rupee depreciated by 2.4% on average against the dollar. A weaker rupee improves realisation of exporters.

The FY17 guidance by the Infosys management will be critical in determining the extent of demand for the fiscal. Investors would be keen to know the demand traction against the backdrop of lowered full year growth forecast by the technology research firm, Gartner. Last week, it reduced the growth forecast for global IT services to 2.1%, a 100 basis point fall from its earlier estimate.

Analysts expect the company to guide for 11-13% growth in the dollar denominated revenue for FY17.