Infosys stock in focus: Here's what brokerages said post analyst meet

Shares of Infosys were in focus today after the IT major reiterated its FY23 guidance of 13 per cent to 15 per cent, remaining vigilant of the macro uncertainties in the near term. However, the company indicated no softness in the demand and highlighted the healthy deal pipeline and no deferment in deal closures so far.

Infosys stock fell 2.19 per cent intraday to Rs 1,471 against the previous close of Rs 1,503.95 on BSE. Later, shares of Infosys closed 1.67 per cent lower at Rs 1,478.90 on BSE.

Infosys share stands higher than 5-day moving averages but lower than 20-day, 50-day, 100-day and 200-day moving averages. The large cap stock has lost 21.82 per cent since the beginning of this year and risen 6.48 per cent in one year.

Total 4.35 lakh shares changed hands amounting to turnover of Rs 64.95 crore on BSE. Market cap of the firm fell to Rs 6.22 lakh crore on BSE.

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The stock hit 52-week high of Rs 1953.70 on January 17, 2022 and fell to a 52-week low of Rs 1362.20 on June 2, 2021.

In an analyst meet on May 31, the Indian IT firm talked about five areas of focus namely scaling of cloud business, continued intensity in digital, investments in next generation opportunities, advanced automation and employee engagement.

The IT major said Europe would be a key growth driver with large companies in the region showing greater willingness to look at digital transformation and a global delivery model.

Post the analyst meet, financial services firm Emkay Global gave a buy rating to the stock with a 31 per cent  (Rs 1,970) upside over the current market price of Rs 1,504 (May 31).  

On the other hand, Motilal Oswal Securities sees the stock reaching Rs 2,000 in a year.

"We expect Infosys to deliver margin on the higher side of its guidance band, with strong growth and reduced dependence on sub-contractors as attrition falls. We expect the company to be a key beneficiary of a acceleration in IT spends. Based on our revised estimates, the stock is currently trading at 21 times FY24E EPS. We value the stock at 28 times FY24 EPS, implying a target of Rs 2,000," said Motilal Oswal Securities.

Edelweiss sees a faster growth in FY23 compared to the last year. It expects strong growth in FY24 and the first half of FY25.

"Beyond that, we do not have visibility as of now. Additionally, even if a macro slowdown occurs, we believe, clients will use this opportunity to invest in tech to gain market share and improve efficiencies as they did during covid," the brokerage said. It kept target for Infosys unchanged at Rs 2,426.

JM Financial Services said, "We moderate our dollar revenue growth estimates to factor in adverse cross currency moves as well as realign exchange rate to 77 per dollar, driving a 1-1.5 per cent cut to our FY22-24 EPS. We maintain BUY with a revised target of Rs 1,800 from Rs 1,970 earlier) as we lower PER to 26 times (10 per cent discount to our target PE for TCS) even as we roll forward to June'24.