Infosys shares tanked on Thursday after the company announced weak growth outlook. Addressing an investor concall on Wednesday Infosys' executive chairman, Narayana Murthy said that he is not very happy with company performance in last two years.
''We expect to be somewhere between 11.5% and 12% in our revenue growth. Much more like 11.5% compared to what is being proclaimed as the Nasscom industry growth rate and that is about 13%,'' he said.
Infosys CEO and managing director S D Shibulal said muted growth in the fourth quarter of 2013-14 may spill over to the next financial year also.
''At the beginning of the quarter (Q4) we gave guidance for FY 2014, several factors may result our revenues to be near the lower end of guidance,'' he said. ''At the broad level some of our clients have seen slowdown in their business, these are across various verticals leading to unanticipated project ramp downs and cancellations in Q4.''
''We have also seen some challenges in skill miss-matches between skills that clients need and what we have which has led to slowdown in ramp-ups. These factors are leading to decline in business momentum for us during the quarter,'' Shibulal added.
''We have re-organised our sales structure and we have created several new small units that can bring better growth in areas where we find headroom for growth. We have also revamped our key performance indicators so that high performers will get better and better rewards,'' Murthy said.
Commenting on the stock, Rajesh Manial, AVP technical research, retail desk, GEPL Capital said, ''Infosys has moved down impulsively creating a bearish price gap on the chart and may see further selling pressure in weeks to come as long as it trades below the level of 3,635.''
''The stock is heavily overbought on daily as well as weekly time frames and has started an impulsive move on the down side. We recommend short selling the stock on a bounce back till 3,425 to 3,500 range with a stop loss of 3,635 for a down side target of 3,250 and possibly lower in coming weeks,'' he added.
Shares of the company declined Rs 284.2, or 7.74%, to trade at Rs 3,386.70. The total volume of shares traded was 321,547 at the BSE (1.08 p.m., Thursday).
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