By Yifan Wang
Infosys shares were sharply lower in early trade Friday, after the Indian IT company cut its full-year revenue guidance in its latest earnings announcement.
The stock was down 9.5% at one point and was last 7.6% lower at 1,338.25 Indian rupees ($16.29).
The selloff came after Infosys late Thursday announced its fiscal first-quarter results. The company posted net profit growth of 5.1% on year for the April-June period, while revenue grew 4.1%.
However, the company cut its full-year revenue growth guidance. It now expects constant-currency-basis growth of 1%-3.5%, down from its earlier forecast of 4%-7%.
Nomura analysts said the cut in the guidance was a “key disappointment” that suggests weaker discretionary demand from clients.
The analysts reckon this could lead Infosys to underperform industry growth in coming months. They cut its stock target price to INR1210 from INR1260 and downgraded Infosys to a Reduce rating from Neutral.
Write to Yifan Wang at yifan.wang@wsj.com
Read the full article here