IT major Infosys expects sluggish growth in January-March quarter mainly due to muted spending by clients, especially in the retail sector.
Infosys CEO and managing director SD Shibulalsaid 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 a Barclays investor meet.
“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
Infosys had raised revenue growth forecast to 24.4-24.9% for the financial year ending March 31, 2014 from 21-22% estimated earlier.
“Many of the factors that have led to the recent slowdown will continue to impact client spending at least in the initial part of fiscal year 2015,” he said.
Infosys co-founder Narayana Murthy was brought back to head the IT major in June, following quarters of laggard performance.
“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.
