Sales: Infosys organic sales growth (excluding Lodestone acquisition) is seen between 1.8 per cent (Kotak) and 2.4 per cent (Bank of America-Merrill Lynch). Weak sales growth is expected on account of seasonality (holidays/furloughs), impact of Hurricane Sandy in the U.S. and continued weak spending from BFSI (banking, financial services and insurance verticals), which contributes a third to overall sales.
Margins: Infosys may report an 80 basis point (Kotak) to 130 basis point (BofA-ML) fall in margins on account of wage hikes, low utilization and hit in volumes due to client shutdowns.
Guidance: Infosys needed to grow by 3.5 per cent in the December and March quarters to achieve its target of 5 per cent growth for the full fiscal year, but weak growth may force Infosys to lower FY13 revenue guidance by about 2 per cent, BofA-ML says. Kotak expects Infosys to lower outlook to 3.6 per cent and Barclays at 3.8 per cent.
Earnings per share: The EPS forecast may be cut by 4 to 5 per cent according to BofA-ML. Kotak, however, estimates a 0.6 per cent cut in EPS guidance to Rs 159.7 as the impact of lower than expected revenue growth will be partially offset by a reset of the dollar rupee rate assumed in the guidance (to Rs 55 per USD from Rs 53 per USD).
Employees: Hiring and attrition figures will be keenly watched. Infosys reported a net addition of 2,600 employees in the September quarter, but attrition rose marginally on a sequential basis. Infosys' low utilization rate at nearly 70 per cent will be keenly watched.
Valuations and stock price: Infosys is trading at a 36 per cent discount to its 10-year median price earnings ratio, according to Thomson Reuters' StarMine estimates. Attractive valuations are likely to support stock prices.