Infosys (Infy) seems to be moving farther and farther away from its bellwether status. The software giant  kicked off the Q2 results season on Friday alright, but delivered yet another set of disappointing numbers.

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Infy’s revenue grew by 2.5% on-quarter to Rs9, 858 crore in the second quarter (Q2, the July-September period), from Rs9, 616 crore in the previous quarter, whereas dollar revenues de-grew by 2.6% to $1.79 billion.

Q2 net profit rose 3.5% on-quarter to Rs2, 369 crore; operating margin eroded by 166 basis points (bps) on-quarter to 26.3%, despite no wage hikes and currency headwinds. Overall, volumes grew 3.8% on-quarter. The Street had predicted a growth of close to 3% in dollar revenues.

The company trimmed earnings per American depository share (EPS) this fiscal to at least $2.97 from $3.03, seeing what management called “challenging times ahead”.

The rupee EPS has been scaled down from Rs167 to Rs160, in order to factor in the appreciation in the rupee (from 55/$ to 53/$) .

Remarkably, the numbers were down in spite of the fact that the recent Lodestone acquisition was not being factored in in the results. “The acquisition of Lodestone will be completed within a week, and the numbers for the same will be factored into this (third) quarter,” said S D Shibulal, CEO and MD. This might mean a further dip in Infy’s earnings in Q3.

Sashi Bhushan, senior research analyst-institutional equities at brokerage Prabhudas Lilladher, said, “Infosys have retained their US dollar revenue guidance despite Lodestone’s acquisition. We expected upward revision of 1-2% including acquisition.”

Rajni Ghildiyal, senior analyst at Asit C Mehta Investments Interrmediates, remarked, “Revenue growth rate has suffered during the quarter largely due to the India revenues, which declined 15% sequentially. As well, the PAT (profit after tax) has been below what we had estimated in a quarter where the expectation from us, as well as the rest of the analyst community, was already sombre.“Infosys is now walking an extremely tightrope in which it will have to clock growth rates in excess of 3.5% in both the subsequent quarters which are supposed to be seasonally weak in nature. This makes us believe that Infosys will find it extremely difficult to achieve 5% revenue growth for FY13E. That, in turn, could be detrimental to earning estimates and valuations. We thus advise investors to sell Infosys as it is now not wise to bottom-fish valuations on this counter.”

Infy is confident of a better performance in the second half of this fiscal on the back of “more transformational deals expected in India”, a reference to corporate affairs ministry’s project. Some analysts such as Dipen Shah of Kotak Securities also believe that certain macro factors could boost Infy’s stock going forward. said, “The growth of top 10 clients and large deals has been decent. The focus area of products, platforms and solutions is doing well.”

Daljeet Kohli of IndiaNivesh Securities said, “The company is trying to invest in future technology. It is transforming itself from an IT offshore service provider to a consulting company. Investors can buy the stock after today’s (Friday’s) correction of nearly 7-8%.”