Buy Infosys; target of Rs 1680: Emkay Global Financial

Emkay Global Financial is bullish on Infosys has recommended buy rating on the stock with a target price of Rs 1680 in its research report dated October 13, 2023.

Broker Research

October 13, 2023 / 14:58 IST

Buy

26 Aug, 2025 12:21

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Emkay Global Financial's research report on Infosys

Infosys reported mixed operating performance in Q2. Revenue grew 2.3% QoQ CC, ahead of our expectations; however, adjusting for higher pass-through and one-timers, it missed our estimates. Q2 revenue growth was impacted by spend reduction in some large clients, partially offset by ramp-ups of large deal wins in cost optimization and vendor consolidation. EBITM expanded 40bps QoQ to 21.2%, ahead of expectations, aided by the comprehensive margin expansion program launched last quarter. The company reported its highest-ever large deal TCV of USD7.7bn in Q2, where 48% of it was net new. Infosys has lowered its FY24 revenue growth guidance range to 1.0-2.5% CC YoY (earlier 1.0- 3.5%), implying -1.9% to flat sequential growth in H2. Management attributed revenue guidance revision to weak discretionary spending, delay in decision making and slower ramp-up of large programs. Management has retained its EBITM guidance of 20-22% for FY24. We have cut FY24-26E EPS estimates by ~1%, factoring in Q2 performance and implied weak H2 outlook.

Outlook

We maintain BUY with a revised TP of Rs 1,680 (earlier Rs1,700) at 23x Sep-25E EPS.

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