In Friday’s trading session, the shares of a global leader in next-generation digital services and consulting climbed by nearly 5 percent on BSE to hit a new 52-week high at Rs. 1,843, after reporting financial results for Q1 FY24-25 with a rise in the net profit by 7.2 percent YoY.
At 11:09 a.m., the shares of Infosys Limited were trading in the green at Rs. 1,808.5 up by 2.8 percent, as against its previous closing price of Rs. 1,759.15, with a market cap of Rs. 7.51 lakh crore.
What’s the News:
The fluctuations in the share prices were observed after the company announced the financial results for Q1 FY24-25, through the recent filings with the stock exchanges on Thursday post-market hours.
Revenue from operations for Q1 FY24-25 stood at Rs. 39,315 crore, marking a 3.7 percent QoQ increase from Rs. 37,923 crore in Q4 FY23-24, and a 3.6 percent increase year-on-year from Rs. 37,933 crore in Q1 FY23-24.
Infosys witnessed a 7.2 percent YoY rise in net profit, climbing from Rs. 5,945 crore in Q1 FY23-24 to Rs. 6,374 crore in Q1 FY24-25. However, there was a 20 percent quarter-over-quarter decline in profit after tax (PAT), dropping from Rs. 7,975 crore in Q4 FY23-24 to Rs. 6,374 crore in Q1 FY24-25.
The operating margin improved to 21.1 percent in Q1 FY24-25, up from 20.1 percent in Q4 FY23-24. Other income surged nearly 50 percent YoY, rising from Rs. 561 crore in Q1 FY23-24 to Rs. 838 crore in Q1 FY24-25, and operating profit also increased by 5 percent over the same period, from Rs. 7,891 crore to Rs. 8,288 crore.
Nuvama target on Infosys:
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Nuvama Wealth Management recommended a ‘buy’ call on the stock, raising its target price from Rs. 1,720 to Rs. 2,050, representing a potential upside of 13 percent from the current trading price of Rs. 1,808.8.
The brokerage highlighted Infosys’ robust performance in Q1 FY24-25 and the company’s upgraded guidance. Management expressed optimism about the recovery in growth prospects, tempered by caution due to ongoing constraints on discretionary spending.
The brokerage believes Infosys stands to gain disproportionately from the expected recovery in discretionary spending in FY25/26, similar to its outsized challenges compared to peers in FY23-24. Nuvama considers
Infosys a prime investment for capitalising on the IT sector’s revival in the coming years.
Stock performance:
The stock has delivered positive returns of nearly 22.7 percent in one year, as well as around 9 percent returns in the last six months. So far in 2024, the shares of Infosys have given about 16.6 percent of positive returns.
About the company:
Infosys Limited, a global leader in next-generation digital services and consulting, is engaged in the business of providing consulting, technology, outsourcing and next-generation digital services, to enable clients to execute strategies for their digital transformation.
Written by Shivani Singh
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