Infosys to move its business out of Russia amid ongoing conflict: CEO Salil Parekh

Infosys Q4 net profit surges 12%, revenues grew 22.7%

Agencies | Updated on: Thursday, April 14, 2022, 08:41 AM IST

Infosys CEO Salil Parekh said Infosys has less than 100 employees in Russia. “We don’t have clients in Russia.
Infosys CEO Salil Parekh said Infosys has less than 100 employees in Russia. “We don’t have clients in Russia." | Photo: Representative Image

India’s second-largest IT services provider Infosys said on Wednesday it is moving its business out of Russia due to the ongoing conflict in the region.

“Seeing the situation we have started the transition of our business and all of our work from the centres from Russia to outside Russia,” Infosys CEO and MD Salil Parekh said while replying to a question on the impact of the Russia-Ukraine crisis on the company’s business in Russia.

Parekh said Infosys has less than 100 employees in Russia. “We don’t have clients in Russia. The work we do in Russia is for the global clients, which we have started a transition. At this stage we have no impact on our business from an Infosys perspective,” he said.

However, he said the company is very concerned about the development in the region. “We are very concerned about what’s going on, on the ground,” Parekh said.

He said the company would help its employees in Russia to relocate and work in other geographies, especially in East Europe.

Net profit surges in Q4

Parekh was talking to reporters at an event to announce the financial results of the company for the fourth quarter of the financial year ended March 31, 2022.

India's second-largest software services company saw its net profit in January-March surge to Rs 5,686 crore and projected a 13-15 percent revenue growth in the fiscal year that began on April 1, 2022 on the back of a ''strong demand environment'' and ''robust deal pipeline''.

Infosys' revenue grew 22.7 percent to Rs 32,276 crore in Q4 FY22. ''Our sustained momentum in FY22, large deal wins, robust deal pipeline and client confidence in our capabilities gives us comfort to provide a guidance of 13 to 15 percent for growth in fiscal 2023,'' Parekh said.

At the start of FY22, Infosys had projected that full year revenue will grow 12-14 percent in constant currency terms. During the year, however, the company upped its outlook a few notches and in January this year, the revenue growth guidance for FY22 was raised to 19.5 - 20 percent.

The company said growth during the fiscal was broad-based, spread across business segments, service lines, and geographies.

Infosys board has proposed a final dividend of Rs 16 per share, taking the total dividend for FY22 to Rs 31 per share, an increase of 14.8 per cent over the prior year. With this, the company has announced total dividend of about Rs 13,000 crore for FY22.

In dollar terms, the Q4 net profit stood at $752 million, nearly 8 percent higher year-on-year, while the revenue came in at $4,280 million, 18.5 percent more than the year-ago period.

For the full year, net profit at$2.9 billion was 13.4 percent higher than the previous fiscal. The revenue grew 20.3 per cent to $16.3 billion.

''Infosys delivered $16.3 billion in revenues with the highest annual growth in the last decade of 19.7 percent in constant currency with a robust operating margin of 23 percent. Growth was broad-based, supported by continued momentum in large deal wins with TCV (total contract value) of $9.5 billion,'' the company said in a statement.

According to Infosys, the TCV of large deal wins was $2.3 billion in Q4.

''What we've had in terms of large deals, and what we are seeing in our pipeline going ahead, gives us confidence about the guidance we start the year with, at 13 to 15 percent. As the year progresses, we'll see what the various forces are that will play into all of this,'' Infosys' top boss said.

While the Q4 results scorecard reflects a 12 percent year-on-year growth in net profit, the numbers are 2 per centlower than the December quarter.

On why the Q4 numbers have trailed the street's expectations, Parekh said while there has been a strong volume growth in the quarter, there was an issue with a client related to a contract situation.

''We see a very good momentum into our business as we look ahead,'' Parekh affirmed.

Infosys to hire over 50,000 freshers in FY'23

Infosys hired 85,000 freshers globally and in India during the year ended March 31, 2022, and is planning to hire over 50,000 freshers in FY'23.

However, the firm's 12-month attrition soared to 27.7 percent in the March quarter, as an industry-wide war for talent and dynamic demand environment kept the sector's attrition levels high.

Infosys shares closed 0.41 percent higher at Rs 1,748 apiece on BSE on Wednesday. The results were declared after market hours.

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Published on: Wednesday, April 13, 2022, 07:45 PM IST