Infosys upbeat about growth despite softness in insurance, energy

Bengaluru: Infosys is confident of revenues growing 11.5-13.5 percent this fiscal despite softness in segments like insurance, energy and telecom.

The Bengaluru-based firm, whose revenues grew 13.3 percent in 2015-16, said its guidance was based on large deal wins, a strong pipeline and innovative initiatives being undertaken.

"... We had (USD) 1.9 billion in 2014-15 and we did more than (USD) 2.7 billion in 2015-16, so we are very happy with the large deal performance there and obviously, that sets a very good base for future. So, when I look at the trajectory of innovation initiatives, the large deal wins and the pipeline that we see, we feel good about future," Infosys CEO Vishal Sikka said.

The country's second-largest software services major today reported a 16.2 percent growth in consolidated net profit at Rs 3,597 crore while revenue was up 23.4 percent at Rs 16,550 crore for the quarter ended March 31, 2016.

Infosys said it expects revenue for 2016-17 to grow in the range of 11.5-13.5 percent in constant currency and 11.8-13.8 percent in US dollar terms, in line with industry body Nasscom's estimate of 10-12 percent for the fiscal.

Talking about the segments, Infosys COO U B Pravin Rao said the company is seeing some softness in the insurance segment.

"This quarter, banking, financial services and insurance (BFSI) grew at 0.2 percent on constant currency basis, but if you ignore the insurance piece, the rest of the business grew at about 1.6 percent... So, we are seeing tremendous amount of traction and momentum excluding insurance. We are optimistic about BFSI," he added.

Rao said on yearly basis, BFSI (including insurance) grew about 11.3 percent and was up about 15.6 percent excluding insurance.

"We are starting to see (growth) and it will take time, but we are not worried in the BFSI segment at all," Sikka clarified.

The Infosys chief acknowledged headwinds in certain industries.

"Energy continues to be under stress, telecom and also parts of retail," he said, adding that industries are also undergoing "deep-rooted transformation" based on the power of digital technology, cloud and artificial intelligence.

"We are extremely well-suited in this area... Regardless of the challenges, I am optimistic and we have the best in front of us," he said.