Infosys Q4 results: Infosys Ltd. provided a cautious FY25 projection, but its transaction wins for the March quarter exceeded analyst estimates of $2–3 million. With $4,564 million in revenue, it fell short of Street estimates, but its margin was basically in line. This is due to a one-time headwind from the renegotiation of a BFSI contract that cost 100 basis points and affected the headline results. Given the circumstances, Infosys’ Q4 earnings were a miss, albeit not by much.
This may have contributed to Infosys ADRs’ overnight loss of around 8%, which concluded with a 2.6% decrease at $16.51 and only a small decline in NYSE after-hours trading. Because of the guidance, analysts have decreased their expectations for both stock price and profits. A few brokerages have given the stock a “Buy” or “Accumulate” rating.
Although deal wins should bolster the medium-term growth forecast, Motilal Oswal stated that Infosys’ guidance for FY25 revenue growth came in much below its estimate. The brokerage finds it reassuring that Infosys has not changed its margin guidance, but it still sees upside potential in the medium run.
With a projected YoY CC of 2.5%, this brokerage is anticipating revenue growth for FY25 to be close to the top end of forecast.
Despite short-term challenges, we believe that Infosys would significantly benefit in the medium run from the increase in IT spending. The company presently trades at 19x FY26E EPS, which is based on our revised projections. We have set a target price of Rs 1,650 for the stock, which is 22x FY26E EPS,” the statement read.
According to Kotak Institutional Equities, increased exposure to impacted segments is the real cause of the restrained growth in FY2024–25E rather than structural issues. It stated that as the environment for discretionary spending improves, a strong digital capabilities, a solid track record on large and mega projects, and strong account management would fuel healthy development.
With a new fair value of Rs 1,750 as opposed to Rs 1,790, this brokerage has lowered its FY2025-26E EPS by 2-3% and kept its “Buy” rating on Infosys shares, which is now valued at 24 times June 2026E EPS.
“With a revised target price (TP) of Rs 1,512 and a valuation based on March’26E EPS with a reduced multiple of 20.1x, we reaffirm our recommendation to ‘Accumulate’ in Infosys. We have upped the target PE multiple given to TCS’s discount from 10% to 15%. Because Infosys’ revenue is more discretionary than TCS’, there is a larger discount to account for the slower revenue increase, according to Nirmal Bang.
According to Nuvama, Infosys’s growth should accelerate in H2FY25 when discretionary spending picks back up. Until then, the stock could continue to decline and underperform competitors like TCS.
The company’s stock has undergone a significant correction lately and is currently trading at appealing price-to-earnings ratios for the fiscal year 2026, standing at 19 times. As a result, the recommendation for the stock’s target price has been revised downwards from Rs 1,850 to Rs 1,720.
(Disclaimer: Businessuncover does not offer investment advice; rather, stock market news is provided for informative reasons only. Before making any investing decisions, readers are advised to speak with a licensed financial advisor.)
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