Infosys decides on variable pay for Q4, employees to get email this week: Report

Infosys rival Wipro plans to give about 80% variable pay to employees while wage hike would be similar to last year’s and is likely in Q2FY24, brokerage Emkay said in a report, citing the management.

Infosys has guided for revenue growth of 4%-7% in constant currency for FY24, well below analysts’ expectations of 10.7%. The weak guidance led a hammering of its stock price. The IT company expects operating margin of 20%-22%.

The previous slowest annual growth was a 5.8% increase in fiscal 2018. Infosys net profit of Rs 6,128 crore in the March quarter also missed analysts’ expectations of Rs 6,624 crore.

Commenting on the March quarter results of largecap IT companies, Kotak Institutional Equities said in a recent report that “a slowdown was expected. The only difference was that the slowdown was far sharper. All large companies missed revenue estimates or were at the lower end of the expectation band (HCLT was an exception, but largely down to surprise in the products business).”

Overall, for largecap IT companies, the brokerage said, “the June quarter will be weak, as the full impact of the banking crisis and slowdown impacts financial performance.”

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Infosys recently informed stock exchanges that it has allotted 5,11,862 equity shares on May 12, 2023, after exercise of Restricted Stock Units by eligible employees. At current market value, 5,11,862 shares are valued at around Rs 64 crore. The IT company said 1,04,335 equity shares have been allotted under the 2015 Stock Incentive Compensation Plan and 4,07,527 equity shares under the Infosys Expanded Stock Ownership Program 2019.