12
Jan
12

Infosys flat Q4 guidance drag stock sharply down

Infosys declared its Q3 FY12 results today. As expected, results were good on account of Rupee depreciation. Its Q3 revenues were Rs 9298 crore and Q3 bottom-line was Rs 2372 crore. EPS for Q3 was 41.51  versus 38.51-39.2 guidance. EBIT margins were 31.17% versus 28.16% for Q2. Overall Q3 numbers were good on most parameters. Q3 performance allowed the IT giant to increase FY12 EPS guidance to Rs 147.13 versus Rs 143.02-145.26 earlier.

Key problem was with the FY12 dollar revenue guidance to 16.4% versus 17.1 -19.1% growth earlier guidance. This guidance factors in flat Q4 revenue growth QoQ. It looks like Infosys management has given extremely conservative guidance to tone down market bullish expectations. But it acted as big dampener and stock closed down 8.4%. It will take some time for Infosys stock to stabilize and move higher. I was active today in selling OTM calls. If stock falls sharply further from these levels then I would be a buyer.

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