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What to expect from Infosys Q4 FY 2013 results?


 What to expect from Infosys Q4 FY 2013 results?
From being one of the worst performing stocks from Sensex companies, the Infosys stock has had a stellar rally, thanks to better then expected FYQ3 2013 numbers.

Now, markets are expecting Infosys to again deliver a good set of Q4 2013 numbers on April 12, as recovery in one of its biggest markets - the US gathers steam.


The biggest bet is on guidance. There is a debate whether the company would withdraw annual guidance, after it did away with quarterly guidance.

Top foreign investment bank JP Morgan said, "If the company decides to go through with guidance, 10-12 per cent USD revenue growth for FY14 (below Nasscom's FY14 growth estimate) should be fair."

On the other hand Credit Suisse has said that while Infosys' commentary on the demand environment remains cautious, we believe it sounds more upbeat than before. "We expect them to guide (assuming they do not discontinue the practice of offering full-year guidance) somewhere close to the range of NASSCOM's 12-14 per cent industry growth expectations for FY3/14. Of this, the Lodestone acquisition is likely to contribute 200 bp," the firm has stated.

Apart from guidance, what would keenly be watched is also the margins. A dip in margins this quarter is likely, given the increase in salaries to onsite employees. Margin pressures are also likely given reports that the company is prepared to sacrifice margins for volumes doing away with its traditional focus on margins.

It would also be interesting to see how new focus areas like cloud computing, big data analytics and mobility are doing.

While Infosys and Wipro have been the laggards in terms of performance over the last few quarters, TCS and HCL Tech have remained the stars.


It would be good if Infosys could match Nasscom's growth forecast of 12-14% for IT exports in the 2013-14 fiscal. The stock would sure surge, if the company puts up such a guidance. But remember, Infosys has been a conservative player and even if it can deliver such results, it will not guide for the same.

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