India's Infosys reports subdued fourth quarter growth
Indian software giant Infosys pledged Thursday to return $2 billion to shareholders this year as it reported subdued growth in profits for the fourth quarter.
The company said it would raise dividends and share buy-backs, with its stock price under pressure due to cuts in businesses' IT budgets and worries over a US visa crackdown under President Donald Trump.
Net profit in the three months to March 31 came in at 36.03 billion rupees rupees ($557.01 million), only marginally above the 36 billion rupees it reported in the same period last year.
"Unanticipated execution challenges and distractions in a seasonally soft quarter affected our overall performance," Infosys chief executive Vishal Sikka said in a statement.
Infosys shares fell by 2.3 percent in early trade after the company forecast revenue growth of between 6.5 and 8.5 percent for the current financial year, lagging analyst projections.
India became a back office to the world as companies subcontracted work to firms such as Infosys, taking advantage of the country's skilled English-speaking workforce.
Infosys was once seen as a stalwart of the flagship industry, but a recent tightening of purse strings has put pressure on profits, with contracts postponed and in some cases cancelled.
It has also faced criticism over corporate governance and salary increases for its top executives.
"Infosys is facing a lot of industry-level and internal challenges and the Trump administration?s policies with regard to business are adding to the uncertainty,"Ashutosh Sharma, head of Forrester Research in India, told Bloomberg.
On Thursday, the company announced it had appointed independent director Ravi Venkatesan as co-chairman.