Infosys Q2 Results Review- Upbeat Guidance; Discretionary Spends Continue To Pick Up In BFSI: ICICI Securities

ICICI Securities Report

Infosys Ltd. reported strong revenue growth of 3.1% QoQ constant currency in Q2 FY25 led by broad-based growth across verticals. Key positive demand trends:

1. Discretionary spends continued to improve in BFSI,

2. double digit QoQ growth in pipeline of small (discretionary) deals (less than $50 million),

3. all large deals have component of AI-led productivity improvement.

However, except BFSI, clients are largely prioritising cost optimisation over discretionary spends in other verticals. Revenue guidance has been revised to 3.75-4.5% YoY CC versus 3-4% earlier for FY25 given strong growth in Q2, but implies soft H2 factoring in seasonal weakness.

We model 4.5%/8.5%/7% revenue growth and Ebit margin of 20- 22% for FY25/26/27E.

We continue to value Infosys on 27.5 times on Q2 FY26-Q1 FY27E earnings per share of Rs 78 to arrive at target price of Rs 2,140. Retain Add on upbeat guidance and continued improvement in discretionary spends in BFSI.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.