The brokerage house, Nomura, maintained Infosys as its top large-cap Indian IT services pick after Infosys acquired two new firms. The brokerage retained its ‘Buy’ rating on Infosys and a target price of Rs 1,810, implying an upside 42% from the current market price. The firm values the stock at an EPS of 23x for the first half of FY28, citing potential upside risks from stronger-than-expected growth or guidance upgrades.
Infosys: Strategic double acquisition
In a recent, Infosys announced the acquisitions of two unlisted companies, Optimum Healthcare and Stratus, for a total investment of $560 million. The deals are expected to close by June 2026, pending regulatory approvals.
Expansion in healthcare provider domain
The acquisition of Optimum Healthcare, which it purchased for $465 million, adds over 1,600 experts with deep expertise in the US healthcare provider segment. Nomura notes this will help Infosys scale its healthcare growth strategy and create synergies across new buying centres.
It also enhances Infosys’ presence in the provider segment, adding new clients and relationships, expanding technology capabilities, and creating synergies across new buying centres, according to management.
Optimum posted a revenue of $275.9 million in FY25, $106.6 million in FY24, and $114.3 million in FY23.
Specialisation in insurance technology
Through the $95 million acquisition of Stratus, Infosys gains 450+ experts specialised in Guidewire implementations and Cloud migration for the property and casualty (P&C) insurance market.
The company is an insurance technology partner serving P&C insurers and managing general agents (MGAs). The firm operates with delivery teams across the US, Canada, and India.
Stratus posted a revenue of $42.8 million in FY25, $36.2 million in FY24, and $35.1 million in FY23 (IT follows a January to December financial calendar).
What’s there for Infosys
Nomura estimates that the combined impact of these two acquisitions, along with the pending Versent deal, could contribute approximately 225 basis points to Infosys’s revenue growth in FY27, assuming a full 12-month contribution.
“We think these acquisitions will help Infy get access to new clients and augment its capabilities in the life sciences and healthcare verticals (mainly from Optimum’s acquisition),” said Nomura.
Infosys share price performance
The share price of Infosys has risen 2.6% in the last five trading sessions. The stock has declined over 12% in the last six months. Infosys share price has eroded 21% of investor wealth in the last 12 months.