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Infosys: A strong performance - Views on News from Equitymaster
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Infosys: A strong performance
Oct 12, 2015

India's second largest software firm Infosys has announced its second quarter results for FY16. The company has reported an 8.9% QoQ growth in sales and a 12.1% QoQ growth in the net profit. Here is our analysis of the results.

Performance summary
  • In rupee terms the consolidated sales increased by 8.9% QoQ during 2QFY16. In US dollar terms, revenues were up 6% QoQ. This is the highest quarterly growth rate in the last 16 quarters.
  • Operating profits were up 15.8% QoQ. The operating margin came in at 25.5%. This is significantly higher than the 24% reported in the last quarter.
  • The other income was higher by 4.5% QoQ. The strong operating performance led to a 13.8% QoQ growth in the profit before tax (PBT).
  • The consolidated net profit came in at Rs 33.98 bn an increase of 12.1% QoQ.
  • The company has declared an interim dividend of Rs 10 per share, which will be paid out on 21 October 2015.

Consolidated Financial Snapshot (IFRS)

(Rs m) 1QFY16 2QFY16 Change 1HFY15 1HFY16 Change
Sales 143,540 156,350 8.9% 261,120 299,890 14.8%
Expenditure 109,070 116,420 6.7% 194,180 225,480 16.1%
Operating profit (EBIT) 34,470 39,930 15.8% 66,940 74,410 11.2%
Operating profit margin (%) 24.0% 25.5%   25.6% 24.8%  
Other income 7,580 7,920 4.5% 17,060 15,500 -9.1%
Profit before tax 42,050 47,850 13.8% 84,000 89,910 7.0%
Tax 11,750 13,870 18.0% 24,180 25,620 6.0%
Profit after tax/(loss) 30,300 33,980 12.1% 59,820 64,290 7.5%
Net profit margin (%) 21.1% 21.7%   22.9% 21.4%  
No. of shares         2,296.9  
Diluted earnings per share (Rs)*         55.6  
P/E ratio (x)*         20.2  

*On a trailing 12 months basis

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