Infosys Issues FY18 Revenue Guidance; Rajesh Murthy, President, Resigns

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Infosys, announcing its first results under new CEO Salil Parekh, said its profits had been buoyed by a deal signed with the United States tax department.

Just like TCS, Infosys Q3 profit and revenue numbers were in line with the estimates.

Revenue for the nine months ended 31 December 2017 stood at Rs52,439 crore, showing an year-on-year growth of 2.1 per cent in reported terms and 5.6 per cent growth in constant currency terms.

In a regulatory filing on the BSE, it said net profit grew 38.3 per cent annually to Rs 5,129 crore for Q3 of 2017-18 from Rs 3,708 crore in the same period year ago and 37.6 per cent sequentially from Rs 3,726 crore quarter ago.

"Our operating margins were stable on the back of broad-based improvement in operational efficiency parameters". Though Parekh has promised that the IT sector is growing at a burgeoning rate and the balance sheet of Infosys is penciling high, but the investors need to be cautious because the picture doesn't seem to be rosy, especially after the news of Infosys President Rajesh Murthy resigned has gone viral after the quarterly announcement.

"Everything I have seen in the company, reconfirms that".

IT major on Friday declared its earnings for the third quarter.

On Friday, Infosys also disbanded the board's committee of directors, which had been formed to oversee and help supervise the performance of previous CEO Vishal Sikka-a move that signals that new CEO Parekh, who was appointed in December, is being given a free hand, without the need for any extra guidance by the board.

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Parekh's appointment came after several months of public spat between the founders and Sikka along with some board members, on issues of corporate governance and transparency.

"This is a phenomenal company that was started by people who had tremendous vision". They had created something which will last a very long time.

When asked on how he will manage this equation, Parekh said he will be deeply connected with the founders.

"The priority, at this minute, is to connect with people and clients".

The management added that the company has added one client in the $100 million band and three clients in the $75 million range.

Infosys explained that during the December 2017 quarter, it had signed an Advance Pricing Agreement with the U.S. administration that had led to reversal of income tax expense provision of Rs 1,432 crore.

Revenue from operations rose 3 percent to 177.9 billion rupees from a year earlier, with revenue from the financial services segment down 0.4 percent at 46.43 billion rupees, the company said.