India’s Infosys profits jump 16.6%

Mumbai, India - Indian software giant Infosys on Wednesday reported a 16.6 per cent jump in quarterly net profits, boosted by a string of lucrative new deals and growing demand for digital services during the coronavirus pandemic.

The Bangalore-headquartered firm said its net profit rose to R51.97bn (US$710mn) for the October-December quarter, up from R44.57bn a year earlier.

The third quarter is traditionally a weak one for India’s IT industry, but CEO Salil Parekh said new partnerships with top global companies such as Daimler and Rolls-Royce had helped to boost the firm’s bottom line.

Quarterly revenue at India’s second-largest IT company climbed 12.3 per cent to R259.27bn from a year ago.

India’s software outsourcing industry has proved a rare bright spot for the beleaguered economy, with Infosys and rival Tata Consultancy Services (TCS) both offering employees salary hikes in 2020 even as the country faces a prolonged slowdown and high unemployment.

“The resilience of Infosys has been severely tested over the past several quarters and I am delighted with our response marked by strong revenue performance, large deal wins, healthy operating metrics and continued low attrition,” chief operating officer Pravin Rao said.

Infosys was at the forefront of an outsourcing boom that saw the country become a back office to the world, as Western firms subcontracted work to a skilled English-speaking workforce.

Over 60 per cent of the firm’s revenue comes from North American markets.

Its larger competitor TCS saw its quarterly profits climb more than 7 per cent last week, one of its strongest third quarter performances.

Infosys shares were up more than 1 per cent in Mumbai ahead of the earnings.