Infosys, India’s second largest software exporter, took the stock market down on Thursday by posting first-quarter results below market expectations and worse, projecting a 5% growth guidance for the year, much lower than its earlier projection.
Industry leader Tata Consultancy Services (TCS), however, came out with better results, but after the markets closed. It posted a 37% rise in net profit in the first quarter to R3,317.7 crore.
BSE’s benchmark Sensex suffered its worst single-day fall of 257 points since June 1 and closed 1.5% down at 17,233, while the National Stock Exchange’s Nifty tumbled 74 points, or 1.3%, to 5,235. BSE’s IT index fell 5.11%.
Although Infosys saw its April-June net profit grow by 33% to R2,289 crore, its shares fell 8%. For, its performance was considered poor despite a wage freeze that contained costs and the rupee depreciation during the quarter that helped exports.
Infosys said it expects a 5% revenue growth in the full fiscal against the 8-10% it projected in April. But TCS’ results were above market expectations, indicating the problems faced by Infosys may not be industrywide.