Infosys Shares Drop to 3-Year Low on Weak Guidance

Shares of Infosys Ltd., India's second-largest information technology services provider, plunged to a three-year low on Friday following the release of its fiscal fourth-quarter results and a subdued revenue growth forecast for the coming year. The stock fell as much as 5 percent in Mumbai trading, closing down 5.53 rupees at 1,172.68 rupees, making it the biggest loser on the Nifty 50 index. In the United States, the company's American depositary receipts dropped 4 percent in after-hours trading to 12.94 dollars, after earlier hitting a 52-week low of 12.46 dollars during the session.

The decline came after Infosys reported a 27.8 percent quarter-on-quarter increase in net profit to 8,501 crore rupees for the quarter ended March 31, driven by a 16.6 percent rise in earnings before interest and taxes to 9,743 crore rupees and lower tax expenses. Revenue grew modestly by 2 percent sequentially to 4.6 trillion rupees, though it declined 1.3 percent in constant currency terms, slightly missing analyst estimates. The company also expanded its operating margin to 21 percent from 18.4 percent in the prior quarter and announced a final dividend of 25 rupees per share.