Trade receivables and unbilled work of Infosys Technologies have risen steadily outpacing revenue growth over the past few quarters, possibly signalling changed business dynamics for India’s tech poster boy which has put margins and cash flows above everything in its three-decade story.
The company’s trade receivables for the June quarter grew sequentially by 5% (in rupee terms) to Rs 4,880 crore compared to the revenue growth of 3.2% to Rs 7,485 crore. Similarly, in the March quarter, trade receivables grew by 7.4% and revenues by 2%. The trade receivables now stand at over 65% of its quarterly revenues, compared to the historical average of 62%.
“The delta between receivables and actual revenue growth has widened for few quarters even if one considers that March quarter (financial year end) usually sees some spike in trade receivables,” said a sectoral analyst working with an international merchant banking firm and not allowed to comment on client specific matters. India’s second largest software exporter is in the midst of renewed growth push after seeing revenue gap with leader Tata Consultancy Services widen, and also to keep Cognizant Technology Solutions at bay.
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