 "Infosys extends gain post Q3 results; hits three-month high")
Shares of Infosys were trading higher by 1.5% at Rs 1,146, extending its previous days 5% rally on the BSE, in an otherwise weak market as brokerages are positive on the stock after the company delivered robust numbers for the third quarter ended December 31, 2015 (Q3FY16).
The stock hit an intra-day high of Rs 1,163, its highest level since October 2015. It has rallied over 9% in past three trading days as compared to 0.33% rise in the S&P BSE Sensex.
During 3QFY2016, Infosys posted a 0.6% quarter on quarter (QoQ) growth in US$ revenues and 1.1% in constant currency (CC) terms. Growth was driven by a 3.1% QoQ jump in IT volumes despite unfavourable seasonality impacting the quarter.
Also, the management has guided towards a higher revenue guidance for FY2016, 12.8-13.2% in CC terms and 16.2-16.6% in Rs terms, as on 31st Dec’2015 (Rs 66.16/ US$). The earlier guidance was 10-12% growth in sales in CC terms for FY2016.
Religare Institutional Research maintains ‘Buy’ rating on the stock with target price (TP) of Rs 1,300.
“Overall, Q3FY16 was a good quarter for Infosys despite multiple headwinds such as higher furloughs, the Chennai flood impact and a high Q2 base. The company’s industry-leading growth is likely to provide room for price earning (PE) expansion over TCS. We marginally raise our EPS estimates (+1-2%),” the broking firm said in a results preview.
“We fine-tune our forecast and are confident of Infosys achieving the top-end of its revised FY16 revenue guidance of 12.8%-13.2% (in CC). For FY17/18 we forecast Infosys to outperform the sector with revenue growth of 14.3%/14.1%. We now forecast EPS CAGR of 13.6% over FY16-18. Out new TP of Rs 1,381 is now at 20x FY17E vs. 18x earlier,” said IDBI Capital in report.
Karvy Stock Broking remain positive on the stock due to structural changes it has undergone under the new management team like focusing on current client demand of Artificial Intelligence, Design Thinking, Automation, Digital etc and also on organization realignment (lower attrition, improving margins, and stable management team).
The broking firm maintains “Buy” rating on the stock and roll-over to FY18E with revised TP of Rs 1,352 at 18xFY18E earnings.
Sharekhan recommended ‘Buy’ with revised TP of Rs 1,430, given the growth acceleration in the recent quarter and strong revenue visibility led by improvement in wins rate, the growth revival strategy is working well under the leadership of Dr Vishal Sikka.
The stock hit an intra-day high of Rs 1,163, its highest level since October 2015. It has rallied over 9% in past three trading days as compared to 0.33% rise in the S&P BSE Sensex.
During 3QFY2016, Infosys posted a 0.6% quarter on quarter (QoQ) growth in US$ revenues and 1.1% in constant currency (CC) terms. Growth was driven by a 3.1% QoQ jump in IT volumes despite unfavourable seasonality impacting the quarter.
Also, the management has guided towards a higher revenue guidance for FY2016, 12.8-13.2% in CC terms and 16.2-16.6% in Rs terms, as on 31st Dec’2015 (Rs 66.16/ US$). The earlier guidance was 10-12% growth in sales in CC terms for FY2016.
Religare Institutional Research maintains ‘Buy’ rating on the stock with target price (TP) of Rs 1,300.
“Overall, Q3FY16 was a good quarter for Infosys despite multiple headwinds such as higher furloughs, the Chennai flood impact and a high Q2 base. The company’s industry-leading growth is likely to provide room for price earning (PE) expansion over TCS. We marginally raise our EPS estimates (+1-2%),” the broking firm said in a results preview.
“We fine-tune our forecast and are confident of Infosys achieving the top-end of its revised FY16 revenue guidance of 12.8%-13.2% (in CC). For FY17/18 we forecast Infosys to outperform the sector with revenue growth of 14.3%/14.1%. We now forecast EPS CAGR of 13.6% over FY16-18. Out new TP of Rs 1,381 is now at 20x FY17E vs. 18x earlier,” said IDBI Capital in report.
Karvy Stock Broking remain positive on the stock due to structural changes it has undergone under the new management team like focusing on current client demand of Artificial Intelligence, Design Thinking, Automation, Digital etc and also on organization realignment (lower attrition, improving margins, and stable management team).
The broking firm maintains “Buy” rating on the stock and roll-over to FY18E with revised TP of Rs 1,352 at 18xFY18E earnings.
Sharekhan recommended ‘Buy’ with revised TP of Rs 1,430, given the growth acceleration in the recent quarter and strong revenue visibility led by improvement in wins rate, the growth revival strategy is working well under the leadership of Dr Vishal Sikka.