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Infosys signs $2 billion AI deal with existing strategic client

Infosys signs $2 billion AI deal with existing strategic client

In a notice to the exchange, India's second-largest IT services exporter, Infosys, told the exchange that it has secured a $2 billion deal with an existing client to provide AI and automation-based development, modernization, and maintenance services over five years. However, the company did not mention the name of the client.

Infosys is scheduled to release its June quarter results on July 20, following TCS and HCL Tech's results, and according to the company's forward guidance from last quarter's results, the company pegged revenue growth in constant currency terms at a range of 4-7% for FY24 growth, its slowest revenue expansion in six years.

Infosys has been announcing large deals over the past few months. For the current year, Infosys has announced winning two megadeals. The first deal is worth $1.5 billion with British oil and gas company BP. The second deal is worth $454 million with Danske Bank.

Infosys deal with BP on May 10 is to provide comprehensive application services. Infosys will oversee a broad range of services, including the development, modernization, management, and maintenance of applications. The Infosys-BP deal aims to bolster business resilience by modernizing application infrastructure, improving operational efficiencies, and accelerating innovation through more adaptive and agile processes.

Infosys signed a strategic collaboration deal with Danske Bank, a Nordic bank, to accelerate the bank’s digital transformation initiatives. The $454 million deal will be in force for five years, with an option to renew for an additional year for a maximum of three times. This collaboration is to help Danske Bank achieve its strategic priorities of better customer experiences, operational excellence, and a modernized technology landscape. It also acquired Danske Bank’s IT center in India, where over 1,400 professionals are employed.

In its latest announcement, Infosys said that it has completed the foundation phase of a major digital program for Bendigo and Adelaide Bank, Australia's largest bank. The program, delivered in collaboration with Microsoft, consolidated multiple legacy document management systems into a single enterprise document management system (EDMS). The new platform, Cobalt cloud offerings, democratizes data, streamlines document storage, and enhances collaboration across the bank.

The company has 40 clients in the $100 million-plus category, up from 38 in December 2022. Last quarter proved to be bad for IT giants, as the report card fell short of analyst expectations.

Infosys for the quarter ending March 2023 reported a 7.8% YoY increase in its consolidated net profit, up from 6.5% in December 2022. The company's revenue for Q4 came in at Rs 37,441 crore, up 16% from the corresponding quarter of the previous fiscal. Operating profit came in up 13% compared to the March 2022 quarter. The operating margin contracted 0.5% annually and sequentially to 21%.

Infosys, at opening shot up 1.6% to Rs. 1446 and at the time of reporting the script was up 1.9% at Rs. 1450.  Technically stock is in uptrend and making higher top higher bottom formation on consistent basis. Technical indicators like RSI and MACD also showing some buy signals for the target of 1580-1600 in short term.

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