Infosys Q3 Review - Excellent Growth To Drive Further Outperformance: Motilal Oswal
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Motilal Oswal Report
Infosys Ltd. reported a growth of 7% QoQ constant currency, ahead of our estimate of 4.8%, on the back of a broad based performance. Large deal total contract value stood at $2.53 billion (net new at 44%). The management indicated traction in large deals, and highlighting that the deal pipeline was the highest in a very long time.
Ebit margin dipped only 10 basis points QoQ to 23.5%, in line with our estimate, despite a drag from employee additions, higher sub-contracting, and lower utilisation (down 70 bps QoQ) in Q3 FY22. A strong topline growth drove profit after tax growth of 7.2% QoQ to Rs 58 billion.
With an exceptional Q3 performance in topline, Infosys increased its FY22 U.S. dollar revenue growth guidance to 19.5-20% YoY constant currency (from 16.5-17.5%).
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