IT bellwether Infosys reported a marginal rise in net profit for the fourth quarter ended March 2013, but its tepid revenue forecast for financial year 2014, sent the stock plunging by over 20% and pushed the benchmark indices Sensex and Nifty to a dismal close on Friday.
The IT major tumbled right at the stroke of the opening bell, and with it went down the other front line stocks from the software space. As the session progressed, stocks from other sectors found support and moved higher, but IT majors languished in negative territory right through the day.
The Sensex, which crashed to 18,186.10, ended the day with a loss of 299.64 points or 1.62% at 18,242.56. The Nifty closed at 5528.55, more than 30 points off the day's low of 5494.50, recording a loss of 65.45 points or 1.17%.
The BSE IT index went down by over 11% and BSE Teck lost close to 9%. Infosys ended the day with a loss of over 21%.
Infosys said its consolidated net profit as per International Financial Reporting Standards rose 1.1% to Rs 2394 crore on 0.3% growth in revenue to Rs 10,454 crore in Q4 March 2013 over Q3 December 2012. The company has forecast a 6% to 10% growth in revenue in both rupee terms and dollar terms for the year ending 31 March 2014. The revenue growth outlook is lower than industry body Nasscom's projection of 12% to 14% growth in IT exports in the current fiscal year.
Among other IT majors, Wipro lost around 4.7%, Tata Consultancy Services declined 1.6%, HCL Technologies lost 1.7% and Mphasis ended lower by 1.7%. Hexaware Technologies, Oracle Financial Services, Mahindra Satyam and Tech Mahindra also ended notably lower.
Coal India, Larsen & Toubro, Maruti Suzuki, Mahindra & Mahindra, Tata Motors, Bharti Airtel, Jindal Steel & Power and Ranbaxy Laboratories ended with sharp to moderate losses.
Jaiprakash Associates ended with a strong gain of 4.7%. Ambuja Cements lost around 3.5%. ITC, BPCL, Lupin, Asian Paints and State Bank of India gained 2% - 2.6%.
Dr Reddy's Laboratories, Ultratech Cement, Hindustan Unilever, Grasim Industries, Hindalco, Power Grid Corporation, Reliance Infrastructure, Kotak Bank, Tata Power, Bajaj Auto, IDFC and Bank of Baroda also ended notably higher.
According to the data released by the government today, the index of industrial production rose 0.6% in February 2013. Manufacturing sector recorded a growth of 2.2%. The mining sector registered a decline of 8.1% and electricity sector declined 3.2%. Production of basic goods declined 1.8% and that of intermediate goods fell 0.7%. Capital goods production rose 9.5%. Production of consumer non-durables rose 2.9% whereas that of consumer durables shrunk 2.7%. Industrial production rose 0.9% during the period April 2012 to February 2013.
Meanwhile, the combined consumer price inflation for rural and urban India stood at 10.39% in March 2013, lower than 10.91% in February 2013, another data showed. Inflation under the category 'food and beverages' stood at 12.42%, the data from the government revealed.