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Infosys to announce Q2 earnings tomorrow, analysts expect announcements on long-term stability plan, salary hike

Earlier, Infosys had given October 13, 2017 as the tentative date for announcing the financial results for the September quarter in its earnings release for the first quarter.

BT Online        Last Updated: October 23, 2017  | 19:58 IST
Infosys to announce Q2 earnings tomorrow, analysts expect announcements on long-term stability plan, salary hike

IT major Infosys will announce its second quarter earnings on Tuesday. This will be the first set of earnings after former CEO Vishal Sikka resigned and co-founder Nandan Nilekani returned as chairman of the company.

Earlier, Infosys had given October 13, 2017 as the tentative date for announcing the financial results for the September quarter in its earnings release for the first quarter.

But on September 5, the firm in a release to the BSE said it would announce quarter and half-year ended September 30, 2017 financial results on October 24.

Analysts expect the firm to focus on long term stability in the business along with short term confidence building measures like date for share buyback and employees' salary hike during its Q2 earnings.

"The Infosys Board has two key issues to manage currently-one, ensuring stability by way of managing stakeholder sentiment and two, offering visibility by way of sharing concrete guidance," Greyhound Knowledge Group CEO and Chief Analyst Sanchit Vir Gogia told PTI.

While multiple short-term tactics like share buyback, employees salary hikes and active client conversations can be expected to ensure stability, it is the concrete guidance that needs most focus and work, Gogia added.

"While visibility on the new CEO announcement is important, we at Greyhound believe Infosys board must also offer concrete guidance on the company's stand on some of the initiatives that were launched in Vishal's term, steps being taken to ensure development of mid-management and reduce senior level exists and most importantly reforms that are either already being executed or planned to ensure zero governance issues in the future," Gogia said.

As per an analyst of a banking investment firm, who did not wished to be named due to business reason, told PTI that as per their research, investors will focus on changes in Infosys digital and growth strategy, demand environment across verticals it operates specially financial services and progress on automation and artificial intelligence which gathered pace under Sikka's regime.

The firm expects Infosys to cut constant currency revenue growth guidance for current fiscal from 6.5-8.5 per cent to around 6-7 per cent.

The company had posted 1.3 per cent increase in net profit to Rs 3,483 crore for the June quarter, helped by client wins in key markets, and raised its annual US dollar revenue outlook. Its revenue grew 1.7 per cent to Rs 17,078 crore in the first quarter of 2017-18 as against Rs 16,782 crore in the year-ago period.

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