| Mumbai, Jan. 12: Infosys, the country's second largest software maker, beat the Street estimates by posting a higher-than-expected rise in net profit of 33.3 per cent at Rs 2,372 crore for the three months ended December 31, 2011 compared with the same period last year with margins bolstered by a weak rupee. On a trailing quarter basis, net profits rose 24.4 per cent from Rs 1,906 crore in the period ended September 30 last year. But the stock was hammered on the markets and tumbled 8.4 per cent to close at Rs 2,588.60 as the software giant cut its dollar revenue guidance for the 2011-12 fiscal year and indicated a flat growth (in dollar terms) for the fourth quarter this year. Infosys projected full year revenues would be in the range of $7.029 billion to $7.033 billion, reflecting a year-on-year growth of 16.4 per cent. This was sharply down from the earlier projection of $7.08 billion to $7.20 billion, translating into a year-on-year growth of 17.1 to 19.1 per cent which it made when presenting the second-quarter results last October. Infosys's revised guidance cast a pall over the entire industry and stocks of leading IT companies such as Tata Consultancy Services and Wipro plummeted 4 per cent and 3 per cent, respectively. Infosys blamed the cut in its dollar guidance on the worsening European crisis. "The global economy, driven by slower growth in developed markets coupled with the European crisis, could impact the growth of the IT industry," said Infosys CEO and managing director S.D. Shibulal, while announcing the results for the third quarter. In the fourth quarter of this year, the company has projected a flattish revenue growth of 0 to 0.2 per cent quarter-on-quarter in dollar terms, while the market was expecting a guidance of 2.5 to 3.5 per cent quarter-on-quarter growth. Revenues during the three months ended December 31, 2011, were Rs 9,298 crore, a year-on-year growth of 30.8 per cent and a quarter-on-quarter growth of 14.8 per cent. The performance was slightly marred by a significant slowdown in offshore revenue growth to 3.2 per cent from 7.7 per cent in the previous quarter. Overall growth in revenues — offshore and onsite — also slowed to 3 per cent from 5.1 per cent in the quarter ended September 30. Brokerages, both domestic and foreign, voiced concerns over the cut in dollar guidance and aired apprehensions about the performance of the sector in 2012-2013. Commenting on the software company's performance, CLSA said, "Infosys' March-12 quarter guidance and associated commentary indicates a marked worsening in the demand environment which will likely impact all vendors. "More importantly, the big guide down in just a quarter invariably casts a doubt on Infosys' guidance policy. Earlier, Infosys' guidance was the industry standard and the flip-flop seen from Infosys in recent times does not augur well for its PE multiples in the medium term," CLSA added. Shibulal told the media that business sentiment had worsened marginally since November as clients had tightened discretionary spending on technology. During the third quarter, Infosys added 49 clients, a number that impressed analysts. Europe and manufacturing shone, while North America and retail disappointed, said brokerage Prabhudas Lilladher. "Revenue for North America and Europe grew 0.9 per cent and 14 per cent quarter-on-quarter whereas in the verticals, manufacturing and retail grew 4.5 per cent and 0.8 per cent, respectively," the brokerage said. The technology giant had 145,088 employees on its rolls with a gross addition of 9,655 employees in the third quarter. The employee attrition rate dipped marginally to 15.4 per cent from 15.6 per cent in the second quarter. | 
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