Angel Broking's report on Infosys
"For 4QFY2015, Infosys posted results below our expectations. It posted a 2.6% qoq dip in USD revenues to US$2,159mn on account of cross currency movement. In Constant Currency (CC) terms, the company posted a sales dip of 0.4% qoq. On the operating front, the EBITDA margin came in 27.7% (V/s 28.0% expected), a dip of 97bp qoq, on account of increase in S&M spends which grew by 8.7% qoq. Consequently the PAT came in at Rs 3,098cr (V/s Rs 3,182cr expected), down 4.7% qoq. In terms of guidance, FY2016 revenues are expected to grow between 10%-12% in CC terms. During the quarter, the dividend pay-out ratio increased to up to 50% of post-tax profits effective FY2015. Also, 1:1 bonus issue of equity shares was done during the period."
"Infosys posted a dip of 2.6% qoq in USD revenues to US$2,159mn on account of cross currency movement. In CC terms, the company posted a sales dip of 0.4% qoq. In terms of markets, the USA posted a 0.7% qoq dip, Europe a 6.1% qoq dip and ROW posted a dip of 5.7% qoq. On CC basis, the USA posted a 0.4% qoq de-growth, Europe posted a 0.3% qoq de-growth and ROW grew by 0.1% qoq. On the operating front, the EBITDA margin came in at 27.7% (V/s 28.0% expected), a dip of 97bp qoq, on account of increase in S&M spends which grew by 8.7% qoq. Consequently the PAT came in at Rs 3,098cr V/s an expected Rs 3,184cr, down 4.7% qoq."
Outlook and valuation: "Going forward, the company has maintained its future CC USD revenue growth guidance for FY2016 at 10-12%. By FY2017, the company expects to lead industry growth and reach a milestone of achieving sales of US$20bn by FY2020. The stock is cheap at current valuations of 15.3x FY2017E earnings. We maintain our Buy rating on the stock with a target price of Rs 2570", says Angel Broking research report.
For all recommendations, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Read More
