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Big blow to Infosys investors, after Q4 the stock fell by 9%, what to do now?

Today, the stock of Infosys weakened by 9 per cent to Rs 1592 on the BSE in intraday. Whereas last week it closed at Rs 1749.

Infosys Share Price: The shares of Infosys, the country’s second largest IT company, are seeing a huge decline today. Today, the stock of Infosys weakened by 9 per cent to Rs 1592 on the BSE in intraday. Whereas on Wednesday last week, it closed at Rs 1749. The company’s fourth quarter results have been slightly weaker than expected, which has spoiled investor sentiment today. However, brokerage houses are positive about the stock and expect a better upside going forward. The market cap of the company has come down to below 6.80 lakh crore today.

Results weak, but guidance strong

The company’s conso net profit stood at Rs 5686 crore. It has decreased on a quarterly basis. At the same time, the company has a growth of 1.2% QoQ CC in 4QFY22, which is weaker than the estimate of 2.8 percent. The company’s EBIT margin declined by 190bp QoQ to 21.6 percent, which is weaker than the 23 percent estimate. In the fourth quarter, the company has received large orders worth $ 2.3 billion. The management has kept margin guidance at 21-23 per cent for FY23, which is 100bps lower than the earlier guidance. On the other hand, the guidance for revenue growth has been given at 13-15 per cent. It is expected that it will increase in the next quarters.

The company’s constant currency revenue growth has been 19.7 per cent for the full financial year 2022, while the company has projected it to be at 19.5-20 per cent in its guidance. The company’s margin has been 23 percent in FY 2022, while the company had projected it to be 22-24 percent in its guidance.

Share brokerage opinion

Brokerage house Emkay Global has given a target of Rs 1970 while recommending investment in the stock. Whereas Motilal Oswal has given a target of Rs 2000 while advising to buy in the stock. Brokerage house CLSA has also advised to invest in the stock and has given a target of Rs 2040. Whereas Goldman Sachs has given investment advice with a target of Rs 2060. Brokerage house Nomura has given buying advice giving a target of 2050. Morgan Stanley has also given a target of Rs 2050 while giving a buying opinion.

The brokerage says that although INFOSYS’s earnings in 4QFY22 have been weak, but the confidence has increased due to strong revenue growth guidance. The order book of the company is also strong. The demand environment remains favorable and the company will also get the benefit of increasing IT spending.

(Disclaimer: Stock investment advice is given by the brokerage house. These are not the personal views of DIGITNEWS.IN. Markets are risky, so take expert opinion before investing.)

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