Infosys Q2: Worst behind co; Q3 outperfomance likely, says Dipan Mehta

After a phase of being the laggard of the sector for some time, Infosys is likely to turn outperformer in Q3 believes Dipan Mehta, member, BSE & NSE. Mehta’s views come on the back of a stellar Q2 performance by the IT bellwether aided by the rupee depreciation.

Mehta adds that all the issues that were plaguing the company- management rejigs, growth concerns- have now been addressed.

Bullish on the company’s Q3 performance, Mehta adds, “Do keep in mind that Infosys is at the top end in terms of the technology capabilities and the kind of markets which they are addressing.”

Below is the edited transcript of Mehta’s interview to CNBC-TV18.

Q: You heard the numbers of Infosys, what do you think? Do you think this stock now doesn’t move below Rs 3,400 very easily?

A: Looks like it and I do agree with the panel when they say that the bottom had been set for an Infosys. I think the important thing is that after a long time we are seeing two consistent quarters of performance otherwise in the past we used to have one good quarter, one bad quarter.

Now, we have had two consecutive quarters of very good performance coming from Infosys and gradually one-by-one all the concerns are being addressed. There were growth issues, it was growing below the industry average and now it is at the industry average and the management and the dynamism may soon start growing above industry average.

I think the worst as far as top level management changes are concerned, is well behind them and do keep in mind that Infosys is at the top end in terms of the technology capabilities and the kind of markets which they are addressing. Hence, I think it seems to be reentering another growth phase and after being an underperformer and a laggard versus its peer group and the market as a whole, I think that this quarter maybe the turning point for that company where it starts to outperform its peer group and the market as a whole.