It was yet another good quarter for IT major Infosys, especially in view of TCS and HCL Tech sounding warnings on a difficult quarter for the period ending Dec 31, 2014. Infosys reported Q3 numbers that beat expectations on several fronts.
1) Dollar revenue guidance intact
Analysts were worried that the company may lower its dollar revenue guidance for the next fiscal. It took them by surprise when Infosys maintained its dollar revenue guidance at 7-9 per cent for the next fiscal.
2) Best volume growth in 3 years
The company in the quarter ending Dec 31, 2014 reported the best ever volume growth at 4 per cent. This has never been achieved in the last three years.
3) Sharp jump in operating margins
Operating margins at the company came in at a healthy 26.74 per cent as against analysts expectations of an operating margin of under 26 per cent.
4) Pricing pressures stable
There was no pricing pressure seen, except in the energy sector where the company did face some pricing issues.
5) Management commentary positive
Vishal Sikka, CEO of the company sounded pretty optimistic in his press conference. In fact, one could not find any signs of concerns, and guidance also seemed positive.
6) Results against poor guidance from TCS and HCL Tech
The results came against the backdrop of poor guidance from both TCS and HCL Tech. TCS warned recently of weak revenue growth for the December quarter, arising from seasonality and pressure in its banking, financial services and insurance (BFSI) business.
The stock of Infosys surged a huge 5 per cent in trade and was last trading at Rs 2072 as against Thursday's close of Rs 1974. Many analysts are likely to upgrade the stock to a buy.