Infosys shares fall 3%, market cap erodes by Rs 8,000 crore

Infosys shares ended 3% lower on the bourses on Monday, resulting in the company’s market capitalisation eroding by nearly Rs 8,000 crore.

The stock fell after the company reported less-than-expected margin guidance for fiscal year 2018-19.

During the day, the stock of the company fell to an intra-day low of Rs 1,099, down 5.98% over its previous closing price. At the end of today’s trading session the stock was quoted at Rs 1,132.80, down 3.10%.

On the NSE, the stock fell to an intra-day low of Rs 1,102 and finally settled for the day at Rs 1,134.50, down 3.15% over its last close.

Following the decline in the counter, the market capitalisation of the company declined by Rs 7,887.28 crore to Rs 2,47,416.46 crore. The stock was the second largest loser in the 30-share index.

Global brokerage Nomura in a research note said, “growth weakness in developed markets, BFSI and retail is a negative. We expect the stock to react negative to the margin guidance cut”.

The report further noted that “guidance for FY19 growth is in line with consensus, though a cut in EBI margin guidance to 22-24% (as against 23-25% earlier) was a disappointment”.

Infosys, on April 13, reported a consolidated net profit of Rs 3,690 crore, or Rs 16.98 per share, in January-March 2018 quarter as compared to Rs 3,603 crore, or Rs 15.77 a share in the same period a year back.

For 2018-19, Infosys expects its revenue to grow in the range of 6-8% in constant currency terms and 7-9% in the US dollar terms. For financial year 2018-19 Infosys expects operating margin range at 22% to 24%.