Infosys Ltd. share price target

13 April 2019 full-year CC revenue growth of 9%, EBIT growth of 10.6% (EBIT margin shrank 140bp YoY) and adj. Including the buyback/special dividend, INFO paid out ~125% of its FY19 adjusted profits. For the quarter, INFO grew its revenue by 11.8% YoY CC, EBIT by 3.3% YoY CC and adj. net income by 10.5% YoY CC. QoQ CC revenue growth of 2.1% was in line, but the EBIT margin drop of 160bp QoQ (on adjusted 3Q base of 23%) was higher than anticipated (by 100bp). PAT of INR4.07b exceeded our estimate by 1.5% due to a lower tax rate (22.

and strong deal signings: Infosys delivered inline revenue growth during Q4FY2019, a with a constant currency (CC) revenue growth of 2.1% q-o-q/11.7% y-o-y (second consecutive quarter of double-digit growth). CC revenue growth was primarily led by strong growth in communication (16.6% q-o-q on CC) and hi-tech (6.9% q-o-q on CC). However, financial services CC revenues growth declined 0.8% owing to a slowdown in...

View: Margin concern continues; downgrade to SELL We believe that higher sub-contracting cost, higher attrition, implied investment and localisation in the medium term will lead to margin pressure in FY20 for INFY. We expect INFY to report margins towards the mid-point of its guidance in FY20. We downgrade our earnings estimates by 12%/11.5% for FY20/FY21, primarily because of rupee appreciation and margin headwinds going ahead. We change our rupee assumption to ` 70 for FY20/FY21 as compared to ` 74/` 76 earlier which led to major...

Infosys' 2.1% qoq CC growth for Q4FY19 was in line with our expectations of 2.0%. EBIT margins of 21.4% was down ~110bps qoq. For the full-year FY19, Infosys posted 9.0% CC growth vs. guidance of 8.5-9.0%, while EBIT margins declined 150bps yoy to 22.8%. Infosys provided modest CC growth guidance of 7.5-9.5% and lowered its margin guidance band by 100bps to 21-23% for FY20E. Ex-contribution from its Stater/other...

Infosys came out with good set of numbers in Q4FY19, ahead of our estimate though topline was slightly below our estimate and EBIT margin faced some pressure. Revenue was flat sequentially at Rs 21,539cr against our estimate of Rs 22,109cr. PAT for the quarter stood at Rs 4074cr ahead of our estimate of Rs 3860cr. We are positive on the stock from longer term perspective, however due to cut in FY20E guidance by management, the stock might remain under pressure for few sessions. We maintain our...

Belgium and Germany. Infosys will pay EUR 127.5 mn (~USD 143 mn) for the 75% stake. (Expected closure: Q1FY20). Acquisition of Stater is in sync with Infosys strategy of strengthening its position in Continental Europe and we expect revenue for the business to be ~USD 200 mn with high single digit margin, implying valuation of ~1x EV/Sales. It will add ~1.6% revenue growth & impact on EBIT margins will be 25bps (assuming EBIT margins of 7%) & will be marginally EPS-dilutive on FY20E. The inorganic strategy of Infosys...

Infosys Limited (INFLTD) is the second-largest IT services company in India providing consulting and IT services to clients globally.

25 February 2019 Even as INFOs revenue growth improves its FY19 EBIT margin exit at ~22- 22.5% followed by wage hikes in 1QFY20, pose a risk to consensus EBIT estimate of 23.4% for FY20. This is a key concern weighing on the stocks attractiveness. INFOs recent revival under Mr. Salil Parekh in revenue growth (from 4.6% constant currency (CC) in 2QFY18 to 10.1% CC in 3QFY19) came with an EBIT margin decline of 120bp, despite the INR/USD depreciating 11% during the same period. The trend is remarkably similar to the period under Dr. Vishal Sikka, when INFOs revenues increased from 6.3% CC in 2QFY15 to 15% YoY CC in 4QFY16 and 12% in 1QFY17. EBIT margin during this period shrank 200bp and currency had depreciated by 11%. In both instances, however, we see revenue growth gaining priority over margins. In the earlier period, INFO saw its stock price gain 33%, while in the recent period, the uptick in the stock price was a robust 59%.

Infosys Ltd. reported strong growth in top line and healthy deal wins for the period of Q3FY19. Infosys posted revenue growth of 10.1% on YoY basis and 2.7% sequential growth in constant currency terms for the period of Q3FY19. Deal wins came in strong with TCV of $157 cr.