We recommend a BUY rating on the stock and assign a 26 x P/E multiple to its FY23E earnings of Rs 61.9/share to arrive at a TP of Rs 1,620/share, implying an upside of 10% from CMP.

Adverse employee-mix ratio led to higher average wage growth, up from 3% in FY20 to 5% in FY21 despite offshoring at all-time high. Infosys's FY21 annual report titled Cloud Chaos to Clarity showcases how aggressive cloud adoption globally has opened many new avenues. Infosys believes that its dynamic Cobalt services will deliver accelerated cloud...

Infosys Limited provides IT consulting and software services, including ebusiness, program management and supply chain solutions. The Group's services include application development, product co-development, and system implementation and system engineering. Infosys targets businesses...

Stronger FCF growth (54% in FY21 vs. 22% for TCS) is favourable also due to the pay-out benchmarking. We remain positive, supported by >15% EPS CAGR over FY21-23E, >40% RoIC and ~4% FCF yield. Infosys: We maintain BUY on Infosys (INFY), based on strong growth visibility for FY22 (despite the 4Q revenue miss on offshore impact). INFYs net-new large deal wins of USD 9.3bn (vs. total large deal wins of USD 9bn in FY20) provide high probability to achieve (and outdo) the guided 12-14% CC growth for FY22. Although 4Q deal wins declined sequentially (owing to Daimler deal in 3Q21), net-new large deals were up 19% YoY and digital continues to accelerate >30%, supported by offerings such as Infosys Cobalt. While the supply side metrics are concerning (uptick in attrition/sub-con), large client metrics (USD100mn+) have outperformed peers. 20% higher fresher intake (gross) planned for FY22 will support the demand fulfilment beyond FY22

Infosys Q4 Profit Contracts, But FY22 Revenue Guidance Robust Infosys for the quarter ended Mar 2021 registered a consolidated sales of Rs 26311 crore, a growth of just 1% QoQ and 13% yoy basis. On USD terms the revenue for the quarter was up by...

continued to grow at strong rate of34.4% YoY CC. Manufacturing (+6.1% QoQ wins of $2.1 Bn taking FY21 order book to $14.1 Bn, +57% YoY. Management has guided 12-14% YoY CC growth in line with consensus estimates. Infy reported margin of 24.5%, -100bps QoQ, +330 bps YoY (Ple: 24%, Cons:24%), 50 bps higher than our estimates, led by better utilization (82.2%) and lower than expected hike impact (130bps). Management mentioned that aggressive hiring will reduce utilization and reduce supply side pressures. Hiring for the quarter was strong at 10,307 net addition and they plan to hire...

Improving IT spend, large deal momentum key positive We expect IT spends to improve led by cloud migration, increased spend by companies in customer & employee experience (P&L; led investment) and ancillary technologies like AI, IOT, data analytics. Infosys is in a sweet spot to capture this growth considering the investment it has made in digital technologies. This, coupled with an increase in outsourcing in the US and Europe, vendor consolidation opportunities, captive carve outs and cost take out deals will further boost its revenues. In addition, Infosys has...

Infosys' (INFO) Q4FY21 revenue growth of 2% CC QoQ was in line with our estimate of 1.9%, with the company also posting robust TCV of US$ 2.1bn.

We recommend BUY and assign 25x P/E multiple to its FY23E earnings of Rs. 63.1 per share which gives a TP of Rs. 1,550 per share, an upside of 12%.

Infosys (INFO) reported 4QFY21 constant currency (CC) USD revenue growth of 2% QoQ, below our estimate of 3.1%, as a higher offshore revenue share (100bp) partially offset the strong volume growth of 4.6% QoQ. 4QFY21 EBIT margin declined 90bp QoQ, marginally below our estimate, due to a 130bp wage hike impact and higher subcontracting expenses (+50bp QoQ, highest in the last five years), despite more offshoring and cost optimization. In FY21, revenue (USD)/EBIT/PAT grew 6.1%/30.7%/17.5%. The management guided at FY22 USD revenue growth/EBIT margin of 1214% CC YoY/22-24%. It also characterized the current demand environment...

We expect the IT sector revenue to grow at 14.4/10.8% (in USD terms) for FY22/23E with mid-tier IT growth to come in at 15.1/12.5%. We expect a margin expansion of ~55ps over FY21-23E (10/45 bps expansion in FY22/23E), following a 220bps expansion in FY21, leading to ~17% EPS CAGR over FY21-23E. We remain higher than consensus (HSIE EPS is ~6% ahead for FY23E) and expect the outperformance to continue. We increase multiples for Mindtree/Cyient/Zensar/Sonata and roll forward to Mar-23E for our coverage universe. Earnings for Wipro is revised downwards by 6.5/3.9% due to acquisition impact while we have increased estimates for Mindtree/Zensar/Sonata/Teamlease. We prefer INFY, HCLT, Persistent and Sonata We hosted our 5th Tech Investor forum with 20 corporates/experts participating in the event (virtual). The participants represented the full spectrum: (1) Large-cap IT services (TCS, Infosys, Wipro, Tech Mahindra, L&T; Infotech), (2) IT/ER&D; midcaps & small caps (Mphasis, L&T; Technology, Mindtree, Tata Elxsi, Happiest Minds, Zensar, Sonata, Intellect and Mastek), (3) Staffing (Teamlease) and (4) Tech industry experts (IBM, Capgemini, Salesforce, ISG, and Captive expert ANSR). The commentary across companies/experts indicated a continuation of multi-year industry tailwind (cloud acceleration) and optimism around the sector hitting and sustaining double-digit growth rate was validated

capabilities around Digital, Automation and efficiency have become key. The management is seeing demand coming from cost takeout deals and...

We recommend a BUY with a target price of Rs 1,495.

Infosys Limited provides IT consulting and software services, including ebusiness, program management and supply chain solutions. The Group's services include application development, product co-development, and system implementation and system engineering. Infosys targets businesses...

Wipro: We maintain ADD on Wipro, following a strong revenue performance (the best in nine years) and better-than-expected margin performance. Revenue growth of 3.4% QoQ CC was broad-based and 4Q growth guidance of +1.5-3.5% indicates continued growth momentum. The deal pipeline remains strong and the company won 12 deals of TCV greater than USD 30mn. The total TCV stood at USD 1.2bn, which includes Metro AG (TCV of USD 700mn). Wipro under the new structure will be more agile and will focus on accelerating growth, supported by large deal wins, leveraging partner ecosystem, and higher investments in talent. Key positives include (1) strong guidance, (2) pick-up in deal wins, (3) robust cash generation (OCF of ~149% of net income), and, (4) 246bps QoQ improvement in IT services margin. We increase our FY22/23E EPS by +6.6/6.3% and target multiple to 20x (vs. 18x earlier) to factor in better growth visibility. Our target price of Rs 470 is based on 20x Dec-22E EPS (~20% discount to INFY). The stock is trading at 23.2/20.8x FY21/22x EPS Infosys: We maintain BUY on Infosys (INFY), following a strong 3Q print (best 3Q in 8 years) and the highest-ever deal wins translating into growth leadership in tier-1 IT. TCV of large deal wins (including largest-ever Daimler deal) stood at USD 7.1bn (net new TCV at USD 5.2bn). Growth in 3Q was led by NorthAm-BFSI (Vanguard ramp-up), E&U;, Life sciences vertical and NorthAm-Manufacturing/Communications. INFY scores high on growth visibility based on a staggering 3.5x growth in 9MFY21 net-new large deal TCV over the...

Infosys (INFO) reported constant currency (CC) USD revenue growth of 5.3% QoQ (v/s our estimate of 3.2%) in 3QFY21. This is its best QoQ growth in the last eight years. Growth was broad-based across verticals and regions. In 9MFY21, revenue (USD)/EBIT/PAT grew by 3.8%/26%/16.4%. The company reported its best ever TCV of USD 7.1b (net new wins of 73%), 2x book-to-bill, and above the combined TCV of the last three quarters....

Infy reported phenomenal revenue growth of +5.3% QoQ CC, beating our expectations by 2.4%. Growth beat was driven by revenue gains by strong deal TCV of 1HFY21 and earlier quarters. Digital revenues grew by 31.3% YoY CC and contributing to 50.1% to total revenues (vs 47.3% in 2Q21 and 44.5% in 1Q21). Revenue growth was broad based led by 9.8% QoQ USD rise in BFSI (led by ramp up of Vanguard deal) 10.8% QoQ USD rise in Life Sciences and 8.5% QoQ rise in Manufacturing. Infy posted a strong margin of 25.4% (Ple: 24.9%, Cons:25.1%). Improving onsite pyramid, offshore and nearshore mix,...