The surge in share price brought Infosys on track for its best day in more than seven years on Thursday. The IT bellwether recorded an 11.3 per cent jump in profit in the April-June quarter of the current fiscal
Infosys share price surged 14.5 per cent in intraday trade to hit a fresh 52-week high of Rs 952 apiece on Thursday a day after the IT firm reported stellar numbers in the June quarter, mainly on large deal wins and tighter costs. The IT bellwether recorded an 11.3 per cent jump in profit in the April-June quarter of the current fiscal at Rs 4,233 crore. The surge in share price brought Infosys on track for its best day in more than seven years on Thursday, according to a Reuters report. Research and brokerage firm JP Morgan raised the price target of Infosys target price to Rs 1,000 from previous Rs 900 and reiterated an ‘overweight’ rating to the stock. “Infosys displayed class-leading performance with strong offence on revenue recovery and large deal signings, and solid defence on margin expansion and cash conversion,” JP Morgan said in a research note.
Infosys shares ended 9.56 per cent higher at Rs 910.90 apiece, as compared to a 1.16 per cent rise in the benchmark S&P BSE Sensex. “Management still sees elements of uncertainty in the global economy. Despite this, visibility is higher given that the business has adapted to some of the shocks brought on by the pandemic. Accordingly, revenue and margin guidance was reinstated, which came as a surprise,” said Motilal Oswal Financial Services in a report. It has pegged a target price of Rs 1,050 apiece, a 26 per cent upside with a ‘buy’ rating.
Infosys signed deals worth $1.7 billion during the April-June quarter, despite coronavirus lockdown disruptions. Emkay Global Financial Services termed Infosys’ quarter results as an ‘all-round beat’ with a buy rating. It will take Infosys to jump 20.3 per cent from yesterday’s closing level, to reach the target price of Rs 1,000. “Infosys continues to beat TCS in terms of growth for the fifth quarter in a row, with the margin differential also narrowing. Infosys is likely to outgrow TCS in FY21 for the second year in a row,” it added. “While we sat through a 21% up-move in the past 1 month and with a likely gap up in trade on July 16, we still see a case for further upsides in Infosys over the medium term,” it further said.
Another research and brokerage firm IDBI Capital has upgraded the stock’s rating to ‘accumulate’ from ‘hold’ with a price target of Rs 895, just8 per cent upside. Earlier this week, Infosys announced a digital transformation deal with Vanguard which is its largest-ever deal. “In a big surprise, Infosys has reinstated its FY21 guidance, revenue growth of 0% to 2% YoY in CC and EBIT margin of 21%-23%,” it said.