Infosys ADR plunges 10% in NYSE trade as Q4 results disappoint investors

The American Depository Receipt (ADR) of Infosys took a severe beating in Thursday's trade, tumbling nearly 10 per cent, as the IT major reported a weak set of quarterly results. 

Infosys ADR plunged 9.58 per cent to hit a low of $15.43 on NYSE.  Wipro ADR was also hit hard, falling 3.67 per cent to $22.08. The board of this IT firm will meet over April 26-27, 2023 to consider and approve March quarter results. 

Ahead of its quarterly results, the Infosys stock settled Thursday’s trade at Rs 1,388.60, down 2.79 per cent. Friday will be a holiday for stock exchanges in India on account of Baba Saheb Ambedkar Jayanti and the stock would react to the soft Q4 results only on Monday. 

Infosys delivered a surprisingly weak set of numbers for Q4 and missed Street estimates on multiple fronts on the back of unplanned project rammed down and cancellation across the sectors, said Sanjeev Hota, Head of Research at Sharekhan. Hota said the revenue fall in constant currency terms was worse than sequential decline seen at the peak of Covid-19 crises. 

“Also FY24 guidance seems to be modest and below our expectations both on revenues and margins. Further TCV wins at $ 2.1 billion for the quarter was weak, down 36 per cent QoQ and 9 per cent YoY. Management commentary does not inspire confidence on business outlook amid uncertain demand environment. We expect stock to witness weakness and underperform in near term,” Hota said. 

Infosys reported a 7.8 per cent year-on-year (YoY) rise in consolidated net profit at Rs 6,128 crore for the March quarter on a 16 per cent YoY jump in consolidated sales at Rs 37,441 crore. The IT firm reported margin at 21 per cent, down 50 basis points on both YoY and QoQ basis. 

Infosys has guided for 4-7 per cent revenue growth in constant currency (CC) and 20-22 per cent Ebit margin for the financial year. Analysts were expecting a 5-8 per cent CC revenue growth guidance and 21-23 per cent Ebit margin guidance for the fiscal year.Infosys, Infosys ADR, Infosys shares, Infosys share price, Infosys stock price, Infosys Q4 results