Infosys Ltd

As part of this collaboration, the company will leverage Infosys Cobalt, a set of services, solutions, and platforms for enterprises to accelerate their cloud journey, to deliver industry-leading, infrastructure-managed services, including service desk capabilities, to transform FAB’s IT infrastructure.

Enterprises tools includes artificial intelligence- (AI) and machine learning (ML)-based automation, providing self-healing and self-help capabilities, proactive and prognostic monitoring and observability, improving the resilience of the infrastructure estate, blueprint-based environment provisioning, helping to reduce provisioning time exponentially, allowing faster time to market.

The collaboration aims to transition to an outcome-oriented, automated-managed services model that delivers high-quality, compliant IT services with increased speed and agility. In the long term, it will also establish a highly scalable and flexible IT infrastructure

Suhail Bin Tarraf, group chief operating officer, First Abu Dhabi Bank (FAB), said, “At FAB, we are committed to transforming our IT organization and delivering world-class services that drive tangible business outcomes. After a thorough evaluation, we selected Infosys as our strategic partner due to their proven expertise, innovative solutions, and the strong trust they built at all levels. Infosys’ outcome-oriented managed services model coupled with their automation-powered delivery approach will help us significantly improve service quality, compliance, and operational efficiency.”

Dennis Gada, executive vice president and global head of banking & financial services, Infosys, said, “We are delighted to collaborate with First Abu Dhabi Bank to optimize and modernize their IT infrastructure services, by leveraging Infosys Cobalt and Infosys Topaz. FAB recognized the need to transform their IT operating model, and entrusted Infosys with their IT infrastructure, enabling their digital journey to proceed faster and with more resilience on the backend.”

Infosys is a global leader in next-generation digital services and consulting.

The IT major's consolidated net profit jumped 30.51% to Rs 7,969 crore in Q4 FY24 from Rs 6,106 crore in Q3 FY24. Revenue from operations declined 2.31% to Rs 37,923 crore in Q4 FY24 as compared with Rs 38,821 crore in Q3 FY24.

The scrip rose 0.11% to end at Rs 1,424.85 on Tuesday, 14 May 2024.

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Infosys announced a strategic three-year partnership with the ABB FIA Formula E World Championship, the global motorsport championship for electric cars, as its official Digital Innovation Partner.

Through this collaboration, Infosys will provide in-race analytics, unlock fan engagement experiences, and enhance sustainability reporting and tracking for the Formula E championship.

The partnership between Infosys and Formula E will focus on three core areas: fan growth, technology innovation, and continued environmental stewardship.

• Creating a new Fan Customer Data Platform: With the aim of engaging 500 million fans by 2030, Infosys will help build an AI-powered Fan Customer Data Platform for Formula E to unlock deep fan engagement and personalization opportunities, allowing Formula E to better serve its growing global fan base.

• In-race insights and Driver Statistics: Leveraging Infosys Topaz, an AI-first suite of offerings using generative AI technologies, the collaboration aims to provide real-time insights and real time driver statistics during races, enhancing the overall viewing experience for fans.

• An enhanced sustainability data management tool: With the objective of playing a pivotal role in supporting Formula E's carbon reduction target of 45% by 2030, Infosys will work to transform the sport's carbon reporting capabilities by using AI to improve accuracy, reliability, and traceability of data collection, and setting new standards in sustainability assessments for the championship.

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Infosys along with Alliance for an Energy Efficient Economy (AEEE), India's leading policy support and implementation organization catalyzing the responsible use of energy for a climate resilient and energy secure future, and Indian Institute for Human Settlements (IIHS), India's prospective institution of eminence and interdisciplinary national university focused on urbanization, today launched 'ASSURE' (Accelerating Sustainable and Super-efficient Real Estate), to decarbonize India's commercial building sector and cement the country's global leadership in climate action and sustainability. The program aims to realize 100 million sq. ft. of high-performance commercial buildings in India by 2030.

ASSURE is designed as the world's largest organized effort to implement high-performance buildings at scale. Bringing together experts, innovators, enterprises, and the government, it aims to provide technical assistance to lighthouse projects, ecosystem-wide capacity development, and demonstrate viability drawing inspiration from Infosys' campuses. In addition, ASSURE will help foster entrepreneurship, collaborate with government agencies to help create a supportive policy environment and engage with large financial institutions to implement high-performance commercial buildings.

Infosys is an early mover in setting and achieving ESG goals, advocating for responsible business over the decades. Infosys became carbon neutral in 2020, 30 years ahead of the timeline set by the Paris Agreement and has aggressively progressed commitments and efforts to realize its ESG 2030 vision, and transition to low-carbon operations

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Infosys has allotted 6,57,328 equity shares under ESOP. Consequently, on 02 May 2024, the issued and subscribed share capital of the Company stands increased to Rs 20,75,76,23,960/- divided into 4,15,15,24,792 equity shares of face value Rs 5/- each.

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Infosys announced that it has been positioned as a Leader in The Forrester Wave™: Application Modernization and Migration Services, Q1 2024 report. Infosys has been recognized for its broad range of assets related to service delivery and vertical industry solutions.

Infosys ranked among the top two in the strategy category and top three in the current offering category while also receiving the highest score possible in innovation, global delivery strategy, talent strategy, and 12 other criteria.

The report evaluated Infosys for its expertise in executing modernization and migration tasks under the overarching umbrella of Infosys Cobalt, a set of services, solutions, and platforms designed to accelerate cloud-powered enterprise transformation. The report stated that Infosys' portfolio of services is aligned to its AI-first vision, which emphasizes that data-enabled insights can help enterprises adapt rapidly to changing business conditions.

For the report, Forrester evaluated 15 service providers in the application modernization and migration services based on 25 criteria. These evaluation criteria are grouped under three high-level categories: current offering, strategy, and market presence

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The domestic equity benchmarks pared all losses and traded with decent gains in afternoon trade. The Nifty traded near the 22,050 mark after hitting the day's low of 21,777.65 in early trade. Metal, private bank and financial services shares advanced while realty, media and pharma stocks declined.

At 13:30 IST, the barometer index, the S&P BSE Sensex, was up 226.24 points or 0.30% to 72,696.41. The Nifty 50 index added 50.25 points or 0.23% to 22,046.10.

In the broader market, the S&P BSE Mid-Cap index shed 0.49% while the S&P BSE Small-Cap index gained 0.13%.

The market breadth was negative. On the BSE, 1,648 shares rose and 2,025 shares fell. A total of 147 shares were unchanged.

Politics:

India is gearing up for its election in 2024. The BJP is looking to consolidate its grip on power as it aims for a historic third term while a band of opposition parties, including the Congress, has formed a united front called INDIA to deny PM Modi another victory. The elections will occur in 7 phases, starting on 19 April and ending on 1 June. The Lok Sabha elections 2024 results will declared on 4 June.

Gainers & Losers:

Grasim Industries (up 1.77%), HDFC Bank (up 1.72%), ITC (up 1.52%), Mahindra & Mahindra (up 1.44%) and Apollo Hospitals Enterprise (up 1.41%) were major Nifty gainers.

Bajaj Auto (down 2.77%), HCL Technologies (down 1.38%), Tata Motors (down 1.32%), Nestle India (down 1.23%) and Bharat Petroleum Corporation (down 1.20%) were major Nifty losers.

Stocks in Spotlight:

Infosys shed 0.81%. The IT major's consolidated net profit jumped 30.51% to Rs 7,969 crore in Q4 FY24 from Rs 6,106 crore in Q3 FY24. Revenue from operations declined 2.31% to Rs 37,923 crore in Q4 FY24 as compared with Rs 38,821 crore in Q3 FY24. In terms of guidance, the company has revised its FY25 revenue guidance to 1%-3% in constant currency and operating margin guidance at 20%-22%.

Bajaj Auto slipped 2.77%. The auto major’s standalone net profit jumped 35.11% to Rs 1,936 crore on 28.97% rise in revenue from operations to Rs 11,484.68 crore in Q4 FY24 over Q4 FY23.

ICICI Securities rose 0.61%. The broking firm’s consolidated net profit zoomed 104.3% to Rs 536.53 crore in Q4 FY24 as against Rs 262.68 crore recorded in Q4 FY23. Total income was at Rs 1,544.44 crore in the quarter ended 31 March 2024, registering a growth of 74.5% year on year (YoY).

ITC added 1.52% after the company announced that its wholly owned subsidiary, ITC Infotech India has entered into Share Purchase Agreement to acquire 100% stake in Blazeclan Technologies for total consideration of Rs 485 crore.

Network18 Media & Investments declined 2.58% after the company’s consolidated net loss widened to Rs 206.92 crore in Q4 FY24 as against a Rs 35.19 crore recorded in Q4 FY23. Revenue from operations climbed 63.06% year on year to Rs 2,419.28 crore in the quarter ended 31 March 2024.

Global Markets:

European and Asian stocks declined on Friday as reports of Israeli strikes on Iran further ramped up concerns over worsening geopolitical conditions in the Middle East. Israel, early Friday morning local time, launched missiles in a retaliatory strike against Iran, as per reports. The missile launches follow Iran's attack last Saturday.

U.S. stocks closed mixed on Thursday in another jittery day of trade, as investors focused on rising bond yields and uncertain oil prices.

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Infosys announced that the 43rd Annual General Meeting (AGM) of the company will be held on 26 June 2024.

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Revenue from operations declined 2.31% to Rs 37,923 crore in Q4 FY24 as compared with Rs 38,821 crore in Q3 FY24.

Year on year basis, the company’s net profit jumped 30.01% while revenues increase 1.29% as compared with Q4 FY23.

During the quarter, operating profit was Rs 7,621 crore, down 4.3% QoQ and 3.2% YoY. Operating margin for the quarter was 20.1%, a sequential decrease of 40 bps.

In dollar terms, the IT firm reported revenues of $4,564 million (down 2.1% QoQ and up 0.2% YoY) for the quarter ended 31 March 2024.

In constant currency terms, the company's revenue has declined by 2.2% QoQ and YoY growth remained flat during the period under review.

In Q4 FY24, free cash flow (FCF) was Rs 7,032 crore, registering a YoY growth of 20.33%.

The total contract value (TCV) of large deal wins was $4.5 billion in Q4 FY24, with net new of 44%.

The company had 1,882 active clients as of 31 March 2024 as compared with 1,872 active clients as of 31 December 2023 and 1,872 as on 31 March 2023.

Total headcount as on 31 March 2024 was 3,17,240. Last twelve months IT services attrition rate slipped to 12.6% as of 31 March 2024 as compared with 12.9% as of 31 December 2023 and 20.9% as on 31 March 2023.

In terms of guidance, the company has revised its FY25 revenue guidance to 1%-3% in constant currency and operating margin guidance at 20%-22%.

On FY24 basis, the company’s net profit increased 8.8% to Rs 26,248 crore in FY24 as compared with Rs 24,108 crore in FY23. Revenue from operations rose 4.7% YoY to Rs 1,53,670 crore in FY24.

Salil Parekh, CEO and MD, said, “We delivered the highest ever large deal value in the financial year 2024. This reflects the strong trust clients have in us. Our capabilities in Generative AI continue to expand. We are working on client programs, leveraging large language models with impact across software engineering, process optimization, and customer support.”

Jayesh Sanghrajka, CFO, said, “Free cash flow of $848 million in Q4 was highest in the last 11 quarters driven by our relentless focus to improve working capital cycle. Consistent with the objective of giving high and predictable returns to shareholders, the Board has approved the capital allocation policy under which the company expects to return 85% over the next 5 years and progressively increase annual Dividend Per Share. Operating margin expansion in the medium-term and improving cash generation continue to remain our priorities underpinned by early success in Project Maximus.”

Meanwhile, the company’s board has a signed definitive agreement to acquire in-tech, a leading Engineering R&D services provider focused on German automotive industry. This strategic investment further strengthens the company’s engineering R&D capabilities and reaffirms its continued commitment to global clients to navigate their digital engineering journey.

The company will acquire 100% stake in in-Tech for total consideration of EUR 450 million, includes upfront and earnouts, excluding management incentives, and retention bonus. The said acquisition is expected to close during first half of fiscal year 2025.

Further, the company's board has declared dividend of Rs 20 per equity share for financial year ended 31 March 2024 and additionally a special dividend of Rs 8 per equity share.

Furthermore, the board has also approved the capital allocation policy for the next 5 years from FY25 – FY29 after taking into consideration the strategic and operational cash requirements, “Effective from financial year 2025, the company expects to continue its policy of returning approximately 85% of the free cash flow cumulatively over a 5-year period through a combination of semi-annual dividends and/or share buyback/ special dividends subject to applicable laws and requisite approvals, if any.”

Infosys is a global leader in next-generation digital services and consulting.

The scrip declined 1.80% to Rs 1,395.05 on the BSE.

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The key equity benchmarks traded with moderate losses in early trade. The Nifty traded below the 22,000 level. All the sectoral indices were traded in the red with PSU bank, IT and media stocks decline the most.

At 09:28 IST, the barometer index, the S&P BSE Sensex, was down 460.55 points or 0.64% to 72,028.44. The Nifty 50 index dropped 145.30 points or 0.66% to 21,850.55.

In the broader market, the S&P BSE Mid-Cap index dropped 1.09% while the S&P BSE Small-Cap index fell 0.99%.

The market breadth was weak. On the BSE, 671 shares rose and 2,114 shares fell. A total of 90 shares were unchanged.

Foreign portfolio investors (FPIs) sold shares worth Rs 4,260.33 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 2,285.52 crore in the Indian equity market on 18 April, provisional data showed.

Politics:

India is gearing up for its election in 2024. The BJP is looking to consolidate its grip on power as it aims for a historic third term while a band of opposition parties, including the Congress, has formed a united front called INDIA to deny PM Modi another victory. The elections will occur in 7 phases, starting on 19 April and ending on 1 June. The Lok Sabha elections 2024 results will declared on 4 June.

Numbers to Track:

The yield on India's 10-year benchmark federal paper rose 0.54% to 7.219 from previous close of 7.180.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 83.5250, compared with its close of 83.5100 during the previous trading session.

MCX Gold futures for 3 May 2024 rose 0.35% to Rs 73,271.

The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, was up 0.05% to 106.20.

The United States 10-year bond yield declined 2.07% to 4.553.

In the commodities market, Brent crude for June 2024 settlement rose $ 1.73 or 1.99% to $88.84 a barrel.

Stocks in Spotlight:

Infosys declined 2.22%. The IT major's consolidated net profit jumped 30.51% to Rs 7,969 crore in Q4 FY24 from Rs 6,106 crore in Q3 FY24. Revenue from operations declined 2.31% to Rs 37,923 crore in Q4 FY24 as compared with Rs 38,821 crore in Q3 FY24. In terms of guidance, the company has revised its FY25 revenue guidance to 1%-3% in constant currency and operating margin guidance at 20%-22%.

Bajaj Auto slipped 2.14%. The auto major’s standalone net profit jumped 35.11% to Rs 1,936 crore on 28.97% rise in revenue from operations to Rs 11,484.68 crore in Q4 FY24 over Q4 FY23.

Indus Towers fell 0.86%. NTPC Green Energy Limited (NGEL) and Indus Towers signed a Memorandum of Understanding (MoU), to address the need for pacing green energy objectives and the GoI’s efforts towards carbon neutral economy. The MoU is to explore a joint development of grid connected Renewable Energy based Power Projects including Solar, Wind, Energy storage etc. and/or solutions thereof.

Global Market:

Asian stocks are trading lower on Friday as reports of Israeli strikes on Iran further ramped up concerns over worsening geopolitical conditions in the Middle East. Israel, early Friday morning local time, launched missiles in a retaliatory strike against Iran, as per reports. The missile launches follow Iran's attack last Saturday.

U.S. stocks closed mixed on Thursday in another jittery day of trade, as investors focused on rising bond yields and uncertain oil prices.

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Revenue from operations declined 2.31% to Rs 37,923 crore in Q4 FY24 as compared with Rs 38,821 crore in Q3 FY24.

Year on year basis, the company’s net profit jumped 30.01% while revenues increase 1.29% as compared with Q4 FY23.

During the quarter, operating profit was Rs 7,621 crore, down 4.3% QoQ and 3.2% YoY. Operating margin for the quarter was 20.1%, a sequential decrease of 40 bps.

In dollar terms, the IT firm reported revenues of $4,564 million (down 2.1% QoQ and up 0.2% YoY) for the quarter ended 31 March 2024.

In constant currency terms, the company's revenue has declined by 2.2% QoQ and YoY growth remained flat during the period under review.

In Q4 FY24, free cash flow (FCF) was Rs 7,032 crore, registering a YoY growth of 20.33%.

The total contract value (TCV) of large deal wins was $4.5 billion in Q4 FY24, with net new of 44%.

The company had 1,882 active clients as of 31 March 2024 as compared with 1,872 active clients as of 31 December 2023 and 1,872 as on 31 March 2023.

Total headcount as on 31 March 2024 was 3,17,240. Last twelve months IT services attrition rate slipped to 12.6% as of 31 March 2024 as compared with 12.9% as of 31 December 2023 and 20.9% as on 31 March 2023.

In terms of guidance, the company has revised its FY25 revenue guidance to 1%-3% in constant currency and operating margin guidance at 20%-22%.

On FY24 basis, the company’s net profit increased 8.8% to Rs 26,248 crore in FY24 as compared with Rs 24,108 crore in FY23. Revenue from operations rose 4.7% YoY to Rs 1,53,670 crore in FY24.

Salil Parekh, CEO and MD, said, “We delivered the highest ever large deal value in the financial year 2024. This reflects the strong trust clients have in us. Our capabilities in Generative AI continue to expand. We are working on client programs, leveraging large language models with impact across software engineering, process optimization, and customer support.”

Jayesh Sanghrajka, CFO, said, “Free cash flow of $848 million in Q4 was highest in the last 11 quarters driven by our relentless focus to improve working capital cycle. Consistent with the objective of giving high and predictable returns to shareholders, the Board has approved the capital allocation policy under which the company expects to return 85% over the next 5 years and progressively increase annual Dividend Per Share. Operating margin expansion in the medium-term and improving cash generation continue to remain our priorities underpinned by early success in Project Maximus.”

Meanwhile, the company’s board has a signed definitive agreement to acquire in-tech, a leading Engineering R&D services provider focused on German automotive industry. This strategic investment further strengthens the company’s engineering R&D capabilities and reaffirms its continued commitment to global clients to navigate their digital engineering journey.

The company will acquire 100% stake in in-Tech for total consideration of EUR 450 million, includes upfront and earnouts, excluding management incentives, and retention bonus. The said acquisition is expected to close during first half of fiscal year 2025.

Further, the company's board has declared dividend of Rs 20 per equity share for financial year ended 31 March 2024 and additionally a special dividend of Rs 8 per equity share.

Furthermore, the board has also approved the capital allocation policy for the next 5 years from FY25 – FY29 after taking into consideration the strategic and operational cash requirements, “Effective from financial year 2025, the company expects to continue its policy of returning approximately 85% of the free cash flow cumulatively over a 5-year period through a combination of semi-annual dividends and/or share buyback/ special dividends subject to applicable laws and requisite approvals, if any.”

Infosys is a global leader in next-generation digital services and consulting.

The scrip rose 0.41% to end at Rs 1,420.55 on Thursday, 18 April 2024.

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