The American Depository Receipts of Infosys Ltd. were trading lower and touched its lowest level since September 2020 on Thursday after it posted its fourth quarter earnings. The decline comes as the IT giant has forecasted a revenue growth of 1.5%-3.5% for the fiscal 2027, missing brokerage estimate of 2%-4% for the year.
The ADR of Infosys in pre-market fell nearly 7% to $12.53 as of 8:35 p.m. In addition to missing forecast estimates, Infosys' CC growth declined by 1.3% to 3.1% in quarter ended March, clocking the sharpest decline in four quarters.
The ADR is a tool for multinationals/foreign companies (primarily based outside the US) or organisations to trade on US stock markets, just like regular shares of US companies.
In theory, an ADR is similar to a special certificate issued by a US bank. It is a negotiable certificate representing shares in a foreign company traded on US stock exchanges.
ALSO READ: Infosys Q4 Results: Profit Surges 28%, FY27 Growth Seen At 1.5%-3.55%
India's second largest IT services firm posted posted a 28% surge in profit at Rs 8,501 crore in the fourth quarter of the previous fiscal. This is in comparison to profit of Rs 6,654 crore in the same quarter of the previous fiscal, according to its stock exchange notification on Thursday. This beats analyst estimates of Rs 7,496 crore.
Revenue advanced by 2% year-on-year for the three months ended March, reaching Rs 46,402 crore in comparison to Rs 45,479 crore. Operating income, or earnings before interest and taxes rose 3% year-on-year to Rs 9,743 crore. The EBIT margin expanded to 21% from the earlier 20.8% in the previous quarter.
The revenue growth was aided by a pickup in demand from its banking, energy and communication segments.
Revenue from communications and manufacturing rose over 12.6% and 15.9% respectively on a year-on-year basis. Financial services jumped nearly 5% and energy, utilities, resources and services by 8.3%. On the other hand, income from Hi-Tech fell nearly 1.5%.
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