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Reduce Infosys, target of Rs 1390: IIFL
IIFL has recommended a reduce rating on Infosys Technologies with a 12-month target of Rs 1390. Infosys’s 2QFY09 performance was robust, with 7.1% QoQ revenue growth (constant currency).
IIFL has recommended a reduce rating on Infosys Technologies with a 12-month target of Rs 1390 in its October 13, 2008 research report. "Infosys's 2QFY09 performance was robust, with 7.1% QoQ revenue growth (constant currency). While the yearly guidance has been revised downward by 3ppt (constant currency), management expects no pricing cuts and has seen no indications of rampdowns from existing clients."
"The stock has corrected to a PE of 11x on FY10ii, and is now trading at its lowest ever P/E multiple (the previous low was 12.5x, in FY03). It is also trading close to its lowest FCF yield of 8%. While there could be a near-term rally, any sustained recovery would hinge on the outlook for FY10. We expect marginal profit growth (5%) in FY10 on the back of a 10% decline in BFSI revenues and 2% overall decline in pricing, Reduce, target of Rs 1390," says IIFL's research report.
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To read the full report click on the attachment......
