Infosys Q4 revenue falls QoQ 1st time in decade

Infosys Technologies Ltd has reported first ever sequential fall in its revenue in a decade during the March 2009 quarter. Its operating margin is also under pressure as general and administrative expenses rose despite falling revenue.

The company’s revenue and net profit were more or less in line with the estimates of ET Intelligence Group (ETIG). It reported Rs 5,635 crore in revenue and Rs 1,613 crore in net profit. ETIG had estimated sales of Rs 5,684 crore and PAT of Rs 1,579 crore.

Infosys witnessed over 2% drop in its blended pricing on a sequential basis during the March quarter. It also lost four clients and reported 90 basis points (bps) fall in its employee utilisation including trainees.

Operating margin shrank by 154 bps to 33.5% from the previous quarter. However, net margin expanded by 26 bps to 28.6% thanks to the other income of Rs 252 crore.

The company’s European business suffered a drop of 12.5% sequentially due to beleaguered telecom, manufacturing, and financial sectors.

Its North American business could grow by just over a per cent despite slowdown in the US economy. Among its verticals, manufacturing revenue fell by 6% whereas telecom dropped by 15.3%.

Infosys has guided for a sluggish performance in FY10. It expects earnings per share (EPS) to skid by 3.3-7.6% to Rs 96.65-Rs 101.18. Revenue
is likely to be more or less flat between Rs 22,066 crore and Rs 22,928 crore, a growth of 1.7-5.7%. - Economic Times.

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Infosys declares 270 per cent final dividend

Infosys Technologies Ltd has declared a final dividend of Rs.13.50 per share, which is 270 per cent on par value of Rs.5 per share, for the just-concluded fiscal 2008-09.

In a regulatory filing Wednesday, the IT bellwether said it had made a provision of Rs.7.73 billion (Rs.773 crore) for the dividend payout after the approval by the shareholders at its annual general meeting in June 2009.

The IT bellwether had paid an interim dividend of Rs.10 per share or 200 per cent on par value of Rs.5 per share in October 2008 for the first half (April-September) of fiscal (FY 2009).

The company, however, did not declare special dividend for FY 2009 unlike for the previous fiscal (2007-08). - Economic Times

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Infy Q4 net profit at Rs 1613 crore; EPS guidance at Rs 96.65- Rs 101.18

IT bellwether Infosys Technologies posted a net profit of Rs 1613 crore for the quarter ended March 31, 2009 as against Rs 1641 crore in the Oct-Dec quarter, which translates a fall of 1.73 per cent in net profit on a sequential basis.

Net sales stood at Rs 5635 crore in the fourth quarter compared with Rs 5786 crore for the Oct-Dec quarter.

On a consolidated basis, the IT major has reported a net profit of Rs 5988 crore for the quarter ended Mar 31, 2009 compared with Rs 4659 crore in the corresponding quarter last year.

The company has announced an earnings guidance of Rs96.65- Rs101.18 per share for FY2010.

Infosys has recommended a final dividend of Rs.13.50 per share (270% on an equity share par value Rs 5). - Economic Times

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Intraday tips and market outlook for 15th April.

US markets ended in red.
Europe ended mixed.
Asia has opened in red. Expect Indian Markets to open negative.
The support for the Sensex is 10800 and the resistance to the up move is at 11113-11295
Nifty: (3383) the support for the Nifty is at 3335 and the resistance to the up move is at 3451

Day Trading Ideas

Infosys
Buy above 1418 for targets of 1428 and 1436
Sell below 1394 for targets of 1386 and 1379

RNRL
Buy above 59.45 for targets of 61.25 and 62.90
Sell below 56.45 for targets of 54.90 and 53.50

Tata Chemicals
Buy above 174 for targets of 178 and 181
Sell below 162 for targets of 159 and 156

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Market outlook and Intraday tips for 25th Feb.

US markets opened flat but later rallied.
Europe ended in negative.
Asia is expected to open positive.
Expect Indian markets to open in the same manner flat to negative.

The support for the Sensex is 8630 and the resistance to the up move is at 9030-9157

Nifty: (2736) the support for the Nifty is at 2685 and the resistance to the up move is at 2789-2824

Day Trading Ideas

TCS

Buy above 471 for target's of 476 and 482

Sell below 461 for target's of 457 and 451

Infosys Technology

Buy above 1191 for target's of 1198 and 1207

Sell below 1171 for targets of 1164 and 1158

SBI

Buy above 1036 for targets of 1042 and 1048

Sell below 1020 for targets of 1012 and 1008

Happy Investing !

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Market outlook and Intraday tips for 19th Jan.

US markets ended positive on Friday.
Europe also ended positive.
Asia has opened positive.
I expect Indian Markets to open flat to positive.

The target for the Sensex is 9200 and the resistance to the up move is at 9528-9708

Nifty: (2828) the target for the Nifty is at 2740 and the resistance to the up move is at 2870-2922

Markets may not be able to sustain all its gains and may remain volatile.

Day Trading Ideas -

Unitech
Buy above 31.10 for targets of 31.90 and 32.50
Sell below 29.15 for targets of 28.60 and 28.10

Suzlon
Buy Above 52.15 for targets of 53.50 and 54.90
Sell below 49.50 for targets of 48.75 and 48.10

Infosys
Buy Above 1277 for targets of 1285 and 1293
Sell below 1257 for targets of 1250 and 1245

Sesa Goa
Buy above 78.50 for targets of 79.25 and 79.90
Sell below 75.45 for targets of 74.80 and 73.90

Visit my new blog Squamble.

Happy Investing

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Market outlook and intraday tips for 14th Jan.

US markets ended mixed.

Europe ended marginally negative.

Asia opened flat but now has pulled back and is trading positive.

India is bonded to open flat or positive.

The target for the Sensex is 8947-8845 and the resistance to the up move is at 9575-9750

Nifty: (2769) the target for the Nifty is at 2685-2404 and the resistance to the up move is at 2812

Day trading ideas

TCS

Buy above 526 for targets of 530 and 534

Sell below 512 for targets of 509 and 505

Infosys

Buy above 1238 for targets of 1243 and 1249

Sell below 1208 for targets of 1201 and 1196

Tata Steel.

Buy above 206 for targets of 209 and 213

Sell below 199 for targets of 196 and 193

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Weekly NEWS letter and stocks to watch out for.

The past week was a horrible one. A company like Satyam can do such a big fraud, unbelievable.

The stocks made a high of 189 and a low of 11.50 in the past week. Its all time high is 575 and all time low is 11.50.

Raju is now sent in jail. But the innocent share holders are now in trouble.

The Indian markets fell 6.04% n the last week.

Though inflation is cooling no sign of good news in seen in the markets.

We have our Quarterly results coming this week for many companies. This will act as a major trigger to the movement in markets.

Markets will lie in a range of 2700 – 3000 (NIFTY) in this week.

Not much of upside is expected.

Satyam saga is yet going on will also decide the trend of the market.

IIP data is suppose to arrive tomorrow so be cautious.

Stocks to look out for in this week.

Satyam – I personally feel not to buy this stock. But this stock will be the most volatile in the coming week.

TCS, Wipro, Infosys – The key rivals of Satyam can benefit as the order book of Satyam can be passed to its rivals.

LNT – LNT bags 1100 crs order last week can give some gain.

Unitech - This is one badly beaten up stock and it bought at bottom can give some good gains. Best buy would be 28 -30 range.

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Market outlook and intraday tips for 9th Jan.

US Markets ended mixed after a volatile start.

Europe ended marginally lower.

Asia is bonded to open flat to negative.

India is bonded to follow the same.

The support for the Sensex is 9100 and the resistance to the up move is at 10000

Nifty: (2920) the support for the Nifty is at 2800 and the resistance to the up move is at 3000

If markets open positive or up 300 odd points it is bonded to give up all its gain. If it opens week it can give a pull back or a short covering.

IFCI
Buy above 22.10 for targets of 22.90 and 23.50
Sell below 20.50 for targets of 19.80 and 19.10

Infosys tech.
Buy above 1197 for targets of 1209 and 1218
Sell below 1171 for targets of 1165 and 1160

Unitech
Buy above 37.50 for targets of 38.20 and 39.25
Sell below 34.10 for targets of 33.50 and 32.60

DLF
Buy above 242 for targets of 246 and 251
Sell below 231 for targets of 228 and 225

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Market outlook and intraday tips for 8th Jan.

Satyam’s fraud was the reason the market tank yesterday. Satyams ADR opened down 91%.

US markets ended lower on an average of 3%. Europe also ended lower.

Asia has opened negative.

India is bond to open negative. The trend in NIFTY is broken and one can see markets giving up gains.

I see a minor correction in NIFTY.

Now a support for Sensex is 8900 and resistance for up move at 10150.

And support for NIFTY is at 2740 and resistance for up move at 3125.



Day trading ideas.



IFCI

Buy above 22.10 for targets of 22.90 and 23.50

Sell below 20.50 for targets of 19.80 and 19.10



Infosys tech.

Buy above 1197 for targets of 1209 and 1218

Sell below 1171 for targets of 1165 and 1160



Unitech

Buy above 37.50 for targets of 38.20 and 39.25

Sell below 34.10 for targets of 33.50 and 32.60



DLF

Buy above 242 for targets of 246 and 251

Sell below 231 for targets of 228 and 225

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Fews stocks which are a value buy.

Noida Toll Bridge - The traffic on the flyway is expected to increase at a healthy rate, mainly due to the ongoing residential and commercial development in Noida and Greater Noida.

Land bank on the either sides of the bridge is an additional asset. The company expects further 40% growth in its average daily traffic over next two years due to Commonwealth games to be held in Delhi NCR in 2010.


State Bank of India - Investors looking for a large-cap stock which will add value to their portfolio can consider accumulating the State Bank of India stock in declines.

Beaten down valuations, strong financials in an extremely challenging macro environment, with sustainable growth in advances, make the bank stock attractive. Though the bank trades at a premium to all public sector banks, this appears justified given the size of its balance-sheet and the huge market share, despite which it has delivered better financial performance than its peers.

Market share for the bank has improved in recent quarters.


NTPC - With its existing operations, ongoing expansion plans and high profitability, NTPC is favourably placed in the power generation space.

Further, the shortage in power supply, which is expected to remain in the medium to long term, will keep the capacity utilization of power plants at a high level.


Infosys - The best known IT stock from India.

Well reputed as a quality solution provider, has very long established relationships with a number of leading banks and corporates in the US and other places, impeccable record of transparency and good corporate governance and strong balance sheet are some of the features why we feel Infosys is a must in every investor’s portfolio.


LNT - India’s infrastructure story is best captured by L&T.

Strong management, healthy order book position, diversification across product categories and geographies are some of the strong points of this bellwether engineering company.


BHEL - Largest power component manufacturer in India. Strong order backlog, capacity expansion to meet demand and robust capex lined up for power projects augur well for the company's earnings growth.


Bank Of India - Bank of India has a strong balance sheet growth, stable margins and good quality assets.

The reduction in NPAs, increased book value and improvement in return on assets are indicators of the bank’s superior performance across parameters.


Bajaj Hindustan - The largest manufacturer of sugar in India. Sugar cycle seems to be turning around making this company, which has used the two year downturn to substantially increase its capacity, an extremely attractive buy.

By-product of ethanol and co generation of power are other strong points of this company. - ET

More to be continued.....

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Investors can bet on larger IT companies

IT companies continue to ride along a rough patch, given the global macro-economic challenges. Though this has adversely impacted their valuations on the bourses, not all is lost for the sector.

While concerns such as lower IT budgets for ’09 and turmoil in the banking, financial services and insurance (BFSI) space remain, positive factors like increased outsourcing and offshoring opportunities and growing pie of domestic business cannot be ruled out. IT stocks have more or less followed the trend in the broader market. The ET IT index has plummeted by nearly 52% in CY08 so far, mirroring the loss witnessed by the Sensex. On a narrower time scale of the past three months, the ET IT index has declined by 30%, which is steeper than the 26% fall seen in the Sensex.

Almost all IT companies, irrespective of their revenue size, have failed to earn returns in the past three months. While four out of the sample of 90 IT companies that declared results in the September ’08 quarter earned returns during the said period, only one —Cambridge Solutions — earned double-digit returns (28%). None of the Sensex companies could fetch gains for investors during the above period.


On the operational front, the situation is even more challenging for IT companies during the current quarter, given the wild fluctuations in the rupee vis-à-vis the dollar and problems in the BFSI space. While over two-thirds of IT exports are in dollar terms, more than one-third comes from BFSI clients. Most IT vendors have shown a decline in their revenue from this space during the September ’08 quarter.

To add to their woes, auto companies in the US are in trouble. Though this will affect the order flow of some Indian IT exporters, the impact will largely be muted, as most of these companies have less than 3% revenue exposure to the auto sector. Among the top five Indian IT companies, Satyam Computer Services is likely to see greater impact since over 5% of its business comes from auto clients. Manufacturing (of which automobiles is a part) and BFSI segments together account for 40-50 % of the revenue of the top five Indian IT companies.

This means a significant portion of their revenue is currently under pressure. In the mid-sized IT space, niche players, including KPIT Cummins Infosystems, which generates over 35% of its revenue by serving auto clients, will take a hit.

Geometric, which provides product lifecycle management (PLM) solutions to auto and other manufacturing companies, is also likely to be affected. Both these companies have witnessed delays in their clients’ decisions. Apart from delay in getting new business, IT companies are also likely to witness a squeeze in the billing rates on existing and renewed projects from auto clients.

On the currency front, the average rupee-dollar rate has moved up by over Rs 2 during the December ’08 quarter so far, compared to the previous quarter. On the other hand, the average rates of rupee-euro and rupee-British pound have gone down marginally. However, the net impact of this will be dominated by the rupee-dollar relationship as majority of IT revenue is earned in dollar terms. IT companies, which consider quarterly average currency rates, are likely to witness a positive impact of currency fluctuations on their topline. This can be in the range of 3-5 %, depending on the proportion of various currencies in their revenue.

However, the currency impact is likely to be marginally negative for those IT companies which consider end-ofthe-quarter forex conversion rates if the rupee appreciates further against the dollar and moves below Rs 47 — the rate prevailing at the end of the previous quarter. IT companies are not expected to throw up any positive surprises in the December ’08 quarter and in the short term. However, the game has shifted from growth to sustainability.

As a fall-out of the economic slowdown, outsourcing and offshoring are likely to gain momentum and top Indian IT companies are set to benefit from this trend. Bigger companies have so far shown consistency in revenue growth compared to their mid- and small-sized counterparts. So, larger companies will also be the first ones to take advantage of a turnaround in the global economy, given their scale and reach. Apart from betting on large IT companies, investors can consider companies which have India-specific strategies, since the domestic economy will be impacted by the global crisis only to a limited extent.
Source - Economic Times

My View Point -
IT may see an increase in revenew as the Rupee has depreciated against Dollar.
Bad news is that its orders have become less as its recession. Not much new orders.

I am neutral on IT Sector.

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