For easy reference,I have summarised the performance as below
Audited Consolidated Results of INFOSYS TECHNOLOGIES LTD
Financial Year 2008-9 ending March 31,2009
|
Rs in Crs |
FY 09 at March 31,2009 |
FY 08 at March 31,2008 |
% Up |
|
Income |
21693 |
16692 |
30 |
|
Net Profit |
5988 |
4659 |
28.5 |
|
Equity ( FV Rs 5) |
286 |
286 |
– |
|
Reserves |
17968 |
13509 |
33 |
|
Networth |
18254 |
13795 |
32 |
|
|
|
|
|
|
Book Value in Rs |
319 |
241 |
32 |
|
EPS in Rs |
104.6 |
84.53 |
24 |
|
Dividend in Rs |
23.5 |
33.25 |
|
|
Dividend in % |
470 |
665 |
|
Infosys has given a flattish earnings guidance for FY 10…so this 28.5% growth in Earnings in FY 09 is unlikely to be maintained in FY 10…In fact they estimate that the EPS would drop into the range of Rs 95.65 to Rs 101.18
Infosys has reacted by 5% to Rs 1345…that’s a forward PE for 13 to 14
Company’s Top Management voice their caution as below
-
Expect Pricing to drop by 6.5%
-
Expect Operating Margins to drop by 3%
-
Survey of 135 Clients that contribute to 83% of Revenues revelas that 60% say that their IT Budget will drop by 10%
-
Environment continues to be challenging
-
Utilisation rate has dropped to below 68% and will remain under pressure
Clearly Infosys is expecting tough times ahead and is being candid about it.For a first time in many years it may actually earn less in the coming year than it did in the year just concluded…I fear if the Rupee appreciates to Rs 45,the margins will come under more pressure…Currently Infosys has hedged US $ 500 Million
Don’t expect Infosys to perform brilliantly on the bourses anytime soon…at Forward PE of 13 and 14,there is a good chance that the share price will react by atleast 20% towards Rs 1000
Clearly the IT Sector is not going create any magic in your portfolios this Year….even if the Rupee sinks to Rs 55 and beyond,clients would leverage for further price cuts