Shares of the IT major Infosys surged 4.07% to Rs 768.30 on Monday. The stock hovered in range of Rs 755.55 and Rs 769.80 so far.
The IT major’s operating profit rose 3.1% to Rs 5,064 crore in Q3 December 2019 over Q2 September 2019. Operating margin was 21.9% in Q3 December 2019 as against 21.7% in Q2 September 2019.
The company increased FY20 revenue guidance. The revised guidance is 10%-10.5% in constant currency higher than 9%-10% estimated earlier. It maintained FY20 operating margin guidance range of 21%-23%.
The Q3 numbers are as per International Financial Reporting Standards (IFRS). The result was announced after market hours on Friday.
Q3 results further underscore that we remain steadfast in our journey of sustained client relevance and deepening engagement with them, as they partner with us in navigating their next in the digital transformation era, said Salil Parekh, CEO and MD. For us, this has translated into double digit growth year-to-date, leading to an increase in revenue guidance, accompanied by expanding operating margins.
Overall performance during the quarter was satisfactory on multiple counts -broad-based growth, steady increase in client metrics and healthy large deal wins, said Pravin Rao, COO. Large deal wins continue to be robust with growth of 56% so far this year. We had a further reduction in attrition, demonstrating the results of our continued efforts towards strengthening employee engagement and value proposition.
Operating margins improved further during the quarter driven by relentless cost optimization and operating leverage, said Nilanjan Roy, CFO. Cash generation was extremely strong with cumulative free cash flow crossing $1.5 bn. Return on Equity increased further to 25.9% driven by margin expansion and increased shareholder payouts.
The company’s annualized consolidated attrition rate stood at 19.6% as on 30 December 2019 as against 21.7% as on 30 September 2019 and 19.9% on 31 December 2018.
Meanwhile, Infosys announced conclusion of the independent investigation into allegations contained in the anonymous whistleblower complaints disclosed earlier. The Audit Committee determined that the allegations are substantially without merit. It concluded that no restatement of previously announced financial statements or other published financial information is warranted.
Infosys is a global leader in next-generation digital services and consulting.