Infosys FY13 revenue outlook under threat: UBS
Reuters Market Eye - Infosys' dollar revenue growth outlook of 5 percent for the year ending March 2013 could be under threat, Chief Executive S.D. Shibulal was attributed as saying by UBS in an investor meet.
Customer deferrals, ramp-downs in a few large projects, delays in large deal closures and longer-than-expected client shutdowns due to Hurricane Sandy, especially in the manufacturing sector, may cause threat to outlook, says a UBS note.
UBS says not surprised by potential outlook cut, but fears its own revenue forecast for company at 3.8 pct may be hurt as it had not factored impact of Hurricane Sandy.
"Our conversation with Infosys reinforces our concerns on near-term pressures on guidance. This is likely to impact stock price over the near term, but we see limited downside from current levels given the low expectations and cheaper valuations," says the note.
Nomura says possibility of an organic revenue growth outlook cut in the third quarter of current fiscal year remains high. It prefers companies with current business momentum like HCL Technologies, Cognizant Technology Solutions and Tata Consultancy Services.
UBS, Nomura both retain "Neutral" rating on Infosys stock. Shares fall 0.6 percent.
An Infosys spokeswoman does not have an immediate comment.
The NSE's IT index has fallen 2.73 percent in last two days after a Cognizant Technology Solutions Corp (CTSH.O) filing with the SEC raised concerns about its 2013 revenue outlook.
- Tweet this
- Share this
- Digg this
- U.S. strikes have slowed Iraq militants but not weakened them - Pentagon
- Japan and India vow to boost defence ties during summit
- Government urges court to leave some coal blocks with companies
- Ukraine accuses Russia of "undisguised aggression" as rebels advance
- UPDATE 9-Pakistani protesters clash with police, soldiers secure state TV
The Nifty surged past the psychologically important 8,000 level for the first time on Monday as blue-chips such as ICICI Bank gained after better-than-expected quarterly economic growth data. Full Article
Government urges Supreme Court to not cancel some 'illegal' coal mines Full Article