With the market spooked by Infosys' dollar revenue guidance for 2012-13 rather than its performance in Q4 of 2011-12, the company led the decline in IT stocks today.
While Infosys was the biggest loser in terms of value and percentage, the other IT stocks too suffered, though to a lesser degree, as their results and guidance are yet to be out.
Infosys shed Rs 251.05 or 9.13 per cent on the BSE to trade around Rs 2,499, post-results. Though it had posted a 27 per cent y-o-y growth in net profit in the last quarter of 2011-12 and its revenue was up about 22 per cent y-o-y in Q4 of last year, both were down marginally on a sequential basis. The fourth quarter margin also was lower compared to the third quarter.
But what disappointed most was the cautious stance adopted by the Infosys management for the current fiscal, particularly revenue in dollar terms.
Infosys, which is known for its understatement and over-performance, was again cautious about the dollar revenue guidance for the current year. Its MD and CEO, Mr S.D. Shibulal, said: "The year ahead looks challenging for the IT services industry, with slow recovery in the global markets." The cautious mood sent the Infosys stock tumbling down about 10 per cent.
The selling pressure witnessed by Infosys pulled down three other IT majors - HCL Tech, TCS and Wipro. HCL Tech lost Rs 11.55 to trade at Rs 482.35. TCS was down by Rs 45.55 to Rs 1,085.85 and Wipro slipped to Rs 425.35, a loss of Rs 13.60.
Among the other BSE IT index constituents, it was Oracle Financial Services Software which lost heavily - Rs 31.40 to Rs 2,720.10. Others like Tech Mahindra, Financial Technologies also were down but to a lesser extent.