Cognizant (NOT RATED): Results indicate recovery in discretionary demand - Ambit

Cognizant's strong 2QCY13 revenue growth and CY13 revenue guidance upgrade (184bps organically) provide greater confidence on a recovery in discretionary demand. Whilst the company's US business is showing signs of a recovery in discretionary spending, the Europe business (particularly Continental Europe) continues to open up towards the global delivery model. Although discretionary demand has gained momentum, it continues to be concentrated around social, mobile, analytics and cloud (SMAC) technologies and regulatory and compliance spends in the BFSI vertical. The Immigration Bill has not impacted Cognizant's client relationships and the company remains optimistic about the outcome of the bill. Cognizant expects to record a revenue growth of 4.1% in 3QCY13 and 3.6% QoQ in 4QCY13.

Source : Equity Bulls

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