INFY: Infosys Stock Sinks on Weak Sales Forecasts

by Christopher Freeburn | April 15, 2014 12:48 pm

On Tuesday, India-based Infosys (INFY[1]) posted a higher-than-expected quarterly profit, but signaled slower sales growth during the current fiscal year[2]. Investors didn’t like the news, sending INFY shares down almost 7% in mid-day trading.

INFY[3]During the fiscal quarter that ended in March, INFY posted a net profit of 29.92 billion Indian rupees, topping the 28.63 billion-rupee profit that analysts had forecast. INFY said it generated sales of 128.75 billion rupees, up 23% from the year-ago quarter, the Wall Street Journal noted.

For the current fiscal year, INFY anticipates sales in U.S. dollars to grow by between 7% and 9%. That is significantly less than the 15% sales growth projected for the software outsourcing industry. It is also below the 11.5% U.S. dollar-denominated sales growth INFY reported during the last fiscal year.

Last week, INFY noted that CEO S.D. Shibulal is scheduled to retire in March 2015[4], but will step down earlier if the company locates a successor prior to the date.

On Monday, Infosys stock closed at $55.58 per share. Over the past 12 months, Infosys stock has gained more than 30%.

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