Buy Infosys; target Rs 3009: Firstcall Research

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Buy Infosys; target Rs 3009: Firstcall Research

Firstcall Research is bullish on Infosys and has recommended buy rating on the stock with a target price of Rs 3009 in its January 21, 2012 research report.

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Firstcall Research is bullish on Infosys and has recommended buy rating on the stock with a target price of Rs 3009 in its January 21, 2012 research report.

"Infosys is a global leader company in the "next generation" of IT and consulting Services & is recognized for its world-class management practices and work ethics. During the quarter ended, the robust growth of Net Profit is increased by 33.26% to Rs 23720 million. During the quarter, 49 new clients were added by Infosys and its subsidiaries. Infosys BPO becomes the first company in India & the Third Company Globally, to be Re-certified a Level 5 eSCM-SP Provider by IT Services Qualification Center (ITSqc). Infosys subsidiary Infosys BPO Ltd has signed a definitive agreement to acquire all of the outstanding share capital in Australia-based Portland Group Pty Ltd. Infosys has been awarded the Global (MAKE) award 2011 for the 8th time. Net Sales & PAT of INFOSYS are expected to grow at a CAGR at 21% and 16% over 2010 to 2013E respectively."

"The company has reported net profit of Rs 23720 million for the quarter ended on December 31, 2011 as against Rs 17800 million in the same quarter last year, an increase of 33.26%. It has reported net sales of Rs 92980 million for the quarter ended on December 31, 2011 as against Rs 71060 million in the same quarter last year, a rise of 30.85%. Total income grew by 31.42% to Rs 97200 million from Rs 73960 million in the same quarter last year. During the quarter, it reported earnings of Rs 41.47 a share."

"At the current market price of Rs 2663, the stock is trading at 18.12 x FY12E and 15.68 x FY13E respectively. Earning per share (EPS) of the company for the earnings for FY12E and FY13E is seen at Rs 146.94 and Rs 169.82 respectively. Net Sales and PAT of the company are expected to grow at a CAGR of 21% and 16% over 2010 to 2013E respectively. On the basis of EV/EBITDA, the stock trades at 12.98 x for FY12E and 11.24 x for FY13E. Price to Book Value of the stock is expected to be at 4.43 x and 3.45 x respectively for FY12E and FY13E. We expect that the company will keep its growth story in the coming quarters also. We recommend 'BUY' in this particular scrip with a target price of Rs 3009 for Medium to Long term investment," says Firstcall Research report.

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To read the full report click on the attachment