Infosys ADRs slipped nearly 2% on Wednesday following the company's December quarter results, as investors weighed a modest profit decline and significant margin pressure against stronger revenue performance and an upward revision in full-year growth guidance. The decline marked a shift in investor sentiment as margin concerns overshadowed positive demand signals.

Mixed Q3 Financial Performance With Revenue Growth

India's second-largest IT services company reported consolidated net profit of ₹6,654.00 crores for the third quarter, declining 2% year-on-year from ₹6,806.00 crores in the same period last year. Revenue from operations rose a healthy 9% year-on-year to ₹45,479.00 crores, reflecting steady deal execution and demand resilience in key markets despite seasonal softness.

Sharp Margin Contraction from Labour Code Impact

Operating margin narrowed significantly to 18.40% compared with 21.30% in the December quarter last year and 21% in the September quarter. The margin contraction was largely driven by the implementation of new labour codes, higher sales-related expenses, and continued investments in newer growth areas. The company disclosed an exceptional item of ₹1,289.00 crores during the quarter related to labour code implementation, which weighed heavily on reported profitability.

Raised FY26 Guidance Provides Optimism

Despite near-term margin pressures, Infosys raised its FY26 revenue growth guidance to 3.00%-3.50% in constant currency terms, up from its earlier outlook of 2.00%-3.00%, while retaining operating margin guidance at 20.00%-22.00%. The guidance upgrade was a key positive takeaway from the results, signaling management confidence in demand recovery and deal execution capabilities.

Valuation and Market Outlook

At the current market price of around ₹1,600.00, Infosys trades at price-to-earnings multiples of 22.80x, 21.10x, and 19.50x for FY26, FY27, and FY28 respectively. Equirus Securities noted that the overall performance was better than expectations in constant currency terms, highlighting strong large-deal momentum as a key positive. However, near-term margin pressures and seasonal softness in the March quarter could continue to influence investor sentiment, as reflected in the ADR performance.

An individual identifying as Rajamani has brought serious workplace harassment allegations against Infosys to public attention through a detailed social media post, claiming to have endured systematic persecution for over two years despite 13 years of dedicated service to the company.

Allegations of Systematic Harassment

According to the social media post on platform X, the employee alleges being subjected to what they describe as a "coordinated network of harassment" allegedly orchestrated by their appraiser along with certain colleagues. The individual claims this systematic targeting began following a personal conflict at the workplace involving the appraiser and coworkers.

Nature of Alleged Harassment

The employee's post details various forms of alleged harassment, including:

• Monitoring of personal movements and stalking behavior
• Orchestrated incidents designed to humiliate and intimidate
• Harassment extending beyond workplace to personal life
• Loss of privacy, autonomy, and dignity
• Treatment described as being "like a prisoner or slave"

The individual characterizes the situation as more than workplace harassment, describing it as an organized and unethical effort to control and humiliate them, creating what they termed a "suffocating environment."

Internal Complaint Process

Despite the severity of the allegations, the employee claims their attempts to seek resolution through internal channels proved unsuccessful. According to the post, complaints were raised with senior management and the matter was discussed internally, but no action was taken, leaving the individual isolated and without resolution.

The employee states this lack of internal response prompted them to seek external intervention, appealing for help to end what they describe as systematic injustice and hold those responsible accountable.

Company Response

Infosys did not respond to queries regarding the allegations at the time of publishing, leaving the serious claims without official company comment or clarification.

Broader Implications

The employee's public appeal emphasizes their belief that no individual should face such treatment in a democratic country, framing the allegations as violations of basic civil rights rather than standard workplace disputes. The case highlights ongoing concerns about workplace harassment and the effectiveness of internal complaint mechanisms in large organizations.