Infosys stock closes higher ahead of Q2 earnings

Infosys stock ended higher ahead of the IT firm's second quarter earnings set to be announced today. Shares of Infosys closed 1.42% higher at Rs 1,708.75 against previous close of Rs 1,684.80 on BSE.

The IT stock has gained after 2 days of consecutive fall. Infosys share stands trading higher than 5 day, 20 day, 50 day, 100 day and 200 day moving averages. The large cap stock has gained 35.84% since the beginning of this year and risen 47.31% in one year.

Total 1.30 lakh shares changed hands amounting to turnover of Rs 22.08 crore on BSE. Market cap of the firm rose to Rs 7.24 lakh crore on BSE.

The stock hit 52 week high of Rs 1,787.50 on September 24, 2021 and fell to a 52 week low of Rs 1,051 on November 11, 2020.

A majority of analysts expect a nearly 20% rise in revenue during the second quarter of the current fiscal. The company is also expected to raise its revenue guidance for the third time in a row. The firm is likely to report a rise of 7% to 10%  in its Q2 net profit.

Here'a look at what brokerages expect from the IT firm in its Q2 earnings show.

Brokerage Sharekhan in an earnings preview note said, "Deal signings are expected to remain healthy, although deal TCVs in Q2 could be muted given higher contribution from smaller deal sizes (includes deals with TCV of $50mn+).

HSBC sees Infosys reporting a net profit of Rs 5,321 crore, rising 9.8 per cent YoY and 2.4 per cent quarter-on-quarter (QoQ). The company posted net profit of Rs 4,845 crore in the same period a year ago and it was at Rs 5,195 crore in the preceding quarter of FY22.

 "We forecast constant currency (CC) growth of 6.2 per cent QoQ as the large deal signed with Daimler in December 2020 is expected to ramp up in this quarter," the brokerage said.

Edelweiss Research expects the firm to report a 8.2 YoY rise in net profit at Rs 5,242 crore. On a QoQ basis, the growth is expected to be flat at 0.9 per cent.

 "We expect Infosys to post margin contraction of 90bps QoQ due to attrition related challenges, wage hikes and deal transition costs. However, some part of the hike is likely to be offset by strong volume growth and better cost control and efficient execution. For Infosys, we would keenly watch out for the movement in attrition, a key variable in our view," the brokerage said.