Arihant Capital recommended hold rating on Infosys with a target price of Rs 1247 in its research report dated October 15, 2020.
Arihant Capital 's research report on Infosys
Infosys reported better earnings performance during Q2FY21. Consolidated revenue for the quarter stood at Rs 24,570 Cr, which has marginally missed our estimate of Rs 24826 cr, registering a growth of +8.6% YoY/+3.8% QoQ. EBIT for the quarter grew by +27% YoY/+16.1% QoQ to Rs 6228 Cr, above our estimate of Rs 5082 Cr, while EBIT margin expanded by 364bps YoY/268bps QoQ driven by digital and cloud capabilities combined with intense client relevance. PAT for the quarter grew by +20.6% YoY to Rs 4,845 Cr, beating our estimate of Rs 4,475 Cr.
At CMP of Rs 1136, Infosys currently trades at P/E of 29 to its FY 20 Earnings. We value Infosys at P/E of 27x to its FY22E EPS of 46, which yields target price of Rs 1247 per share. We assign Hold rating on the stock.
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