Infosys Ltd. posted a stronger than expected rise in net income, as investments in higher-margin digital services and automation pay off. Asia’s second-largest exporter of software services reported net income of 41.1 billion rupees ($558 million) in the September quarter. That compared with the 40.5 billion-rupee average estimate. Revenue climbed 17.3 percent to 206.1 billion rupees, its fastest pace in more than two years. Chief Executive Officer Salil Parekh has focused on stabilizing the company after a tumultuous 2017, when public wrangles between its board and co-founders culminated in the dramatic exit of the well-regarded Vishal Sikka. Parekh said in a statement Tuesday that he was delighted with the broad-based growth across all business segments and geographies. He flagged large deal wins at over $2 billion during the quarter. “The first half of FY19 fiscal has been fairly healthy for deal wins and these should lend visibility for the usually-tepid second half too,” said Ashish Chopra, an analyst at Mumbai-based Motilal Oswal Financial Services Ltd. Infosys also reaffirmed its projection for 6 to 8 percent revenue growth in the fiscal year ending March. The benefits of a weaker rupee were “offset by wage revision for senior management, and by investments in sales transformation and digital competencies,” Kotak Securities wrote in a research note ahead of the results. The company is reporting results days after larger rival Tata Consultancy Services Ltd. posted numbers in line with expectations. India’s IT services industry is dealing with a technology transition as clients move toward automation and visa curbs hamper its ability to base talent in the key U.S. market. Infosys’ shares closed 0.5 percent lower in Mumbai ahead of the release. The stock has climbed 37 percent this year. [Bloomberg]
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