Infosys Q4: 30% growth in net profit, board declares total dividend of ₹28; check details

India’s second-largest IT service company Infosys on Thursday, April 18, reported a 30% jump in net profit to ₹7,969 crore for the March quarter of the financial year 2023-24, driven by interest income and tax gains.

Infosys had reported a net profit of ₹6,128 crore in the March quarter of FY 2022-23.

Consolidated revenue of the company rose 1.3% to ₹37,923 crore in the last quarter of FY24 compared to ₹37,441 crore in the year-ago quarter, Infosys earnings release showed. The revenue remained lower than the street estimates of around 3%.

The surge in Q4 net profit was driven by special income of ₹2,619 crore in the March quarter against ₹589 crore in the year-ago period.

As per Infosys results for Q4FY24, the special income included interest income (pre-tax) of ₹1,933 crore and reversal of net tax provisions amounting to ₹38 crore on account of orders received under Sections 250 & 254 of the Income Tax Act, 1961, from the Income Tax Department in India for certain assessment years.

The IT services major reported a 3.2% drop in operating profit to ₹7,621 crore in the March quarter against ₹7,877 crore in the year-ago period.

Operating margins also dropped by 0.9 percentage point to 20.1% in the March quarter from 21% in the year ago quarter.

For the full fiscal, Infosys reported a 4.7% growth in revenue to ₹153,670 crore in FY 2023-24 against ₹146,767 crore in FY 2022-23.

Operating profit rose 2.7% to ₹31,747 crore in FY24 against ₹30,905 crore in FY23. Operating margins dropped by 40 basis points to 20.7% in FY24 against 21.1% in FY23.

Net profit was 8.9% higher at ₹26,233 crore in FY24 compared to ₹24,095 crore in FY23.

Revenue and net profit in dollar terms

In dollar terms, Infosys reported 0.2% growth in revenue at $4,564 million in the March quarter compared to $4,554 million in Q4FY23. Sequentially, revenue dropped by 2.1% against $4,663 million in the December quarter.

Net profit jumped 28.7% to $958 million in the March quarter against $744 million in Q4FY23.

In region wise revenue share, North America saw a 2.1% drop in revenue share to 59.6% while India saw a 15.4% decline in revenue contribution. Europe and Rest of the World contributed around 5% more in the quarter.

In segment revenue, financial services saw an 8.5% drop in revenue share while retail saw a 3.7% decline. High Tech and Manufacturing segments contributed more to the overall revenue.

Infosys added 98 new clients in Q4

Infosys added a total of 98 new clients in the March quarter of FY24. Total active clients rose to 1,882 from 1872 in the year ago period. Infosy saw a major growth in $1 million plus clients to 959 in Q4FY24 from 922 in Q4FY23.

In the $10 million plus category, the clients rose to 315 against 298 in the year ago period while the $50 million plus category saw addition of 8 new clients at 83.

Employee base shrinks by over 7%

Infosys total employee base shrank by over 7% to 317,240 employees as of March 31, 2024 against 343,234 employees as of March 31, 2023, and by 1.68 % against 322,663 employees as of December 31, 2023.

Infosys announces total dividend of ₹28 per share

Infosys board recommended a final dividend of ₹20 per equity share for the financial year ended March 31, 2024, and additionally a special dividend of ₹8 per equity share.

Infosys to acquire engineering R&D services provider in-tech EUR 450 million

Infosys also announced the acquisition of engineering R&D services provider in-tech for EUR 450 million in a cash deal.

“This strategic investment further strengthens Infosys’ Engineering R&D capabilities and reaffirms its continued commitment to global clients to navigate their digital engineering journey,” Infosys said in a statement.

Germany-based in-tech is one of the fastest-growing engineering R&D services providers that shapes digitisation in the automotive, rail transport and smart industry sectors, it added.

The entity brings to Infosys German original equipment manufacturers (OEMs) client relationships and a multidisciplinary team of 2200 people across locations in Germany, Austria, China, UK, and nearshore locations in Czech Republic, Romania, Spain and India.