India's Infosys lifts FY rev view on strong deal momentum

The Infosys logo is seen at the SIBOS banking and financial conference in Toronto

BENGALURU (Reuters) -Infosys Ltd raised its annual revenue outlook on Thursday after a strong deal pipeline helped India's No.2 IT services company by revenue report a better-than-expected quarterly profit.

The Bengaluru-based company said it expects revenue growth of 16% to 16.5% for the financial year to March, compared to the growth of 15%-16% it had projected earlier.

The company signed 32 large deals, 30.4% more than it did in the same quarter last year, for a total of $3.3 billion - the most in two years, Infosys said.

Infosys categorises "large deals" as those worth at least $50 million in value.

"We see much more demand for automation, cost efficiencies, operational improvement programs," Infosys chief executive Salil Parekh told reporters in a press conference, adding that investments made in Europe over the past two years had kept its business strong in that major market in the reported quarter.

Parekh's comments came after larger rival Tata Consultancy Services Ltd, missed profit estimates and flagged challenges in Europe as clients tightened spending due to rough economic conditions.

Gross addition of clients for Infosys during the quarter rose to 134, from 111 a year ago, while operating margin for the quarter fell to 21.5% from 23.5% year ago.

For the full year ending March 2023, Infosys kept its operating margin guidance at 21%-22%.

Consolidated net profit at the firm rose to 65.86 billion rupees ($808 million) in the three months to Dec. 31, from 58.09 billion rupees a year ago.

Analysts on average had expected a profit of 65 billion rupees, according to Refinitiv IBES data. ($1 = 81.5250 Indian rupees)

(Reporting by Nallur Sethuraman in Bengaluru; Editing by Savio D'Souza and Nivedita Bhattacharjee)