Arihant Capital has given Accumulate recommendation for Infosys with a target price of Rs. 1812 in its research report issued on Jul 15, 2021
Arihant Capital’s research report on Infosys
Infosys (INFY) has reported a mixed set of Numbers in Q1FY22. CC Revenue, INR Revenue is above our estimate, and PAT, EBIT are below our estimate. Consolidated revenue INR 27,896 Cr, +6%/+17.9% QoQ/YoY against our estimate of INR 27,784 Cr. Consolidated EBIT stood at INR 6,603 Cr, against our estimate of INR 6,699 cr, up by 23.1% YoY/2.5% QoQ. On the margins front, EBIT margin improved by 100bps YoY/-81bps QoQ to 23.7%. Consolidated PAT saw a rise of 21.7% YoY to INR 5,201 Cr vs estimates of INR 5,527 Cr, impacted by higher tax outgo and lower operating margin. Revenues in CC terms grew by 21.2% YoY and 4.7% QoQ. EPS stood at INR 12.24 in Q1FY22 vs 10.0 in Q1FY21 respectively.
We value Infosys at P/E of 30x to its FY23E EPS INR 60.4, which yields a target Price of INR 1,812 per share. We upgrade our rating to Accumulate from Hold.