Infosys shares trade flat ahead of Q4 results; Jefferies maintains 'buy'

Shares of Infosys were trading flat ahead of the country’s second-largest software exporter will announce its March quarter earnings today. Infosys shares were quoting at ₹1,752 apiece, up 0.6% on BSE, against the previous closing price of ₹1,741.45. The IT major is likely to release its financial results post-market hours.

During the session so far, the IT heavyweight gained as much as 1% to hit an intraday high of ₹1,759.45, while it touched a low of ₹1,732.25. The stock has fallen more than 3% in a week, 7% in the past one month, and 8% since the beginning of the calendar year 2022. The largecap stock has given 25% returns to shareholders in the past one year as compared to 20% gain in the BSE Sensex.

Analysts at Kotak Institutional Equities expect Infosys to report a sequential revenue growth rate of 2% in constant currency driven by continued strength in discretionary spending by clients. On an annualised basis, the constant currency growth is estimated at 21.1%. In rupee terms, revenue is likely to rise by 23.7% year-on-year to ₹32,544 crore, while profit is pegged to grow by 13.4% Y-o-Y to ₹5,750 crore in Q4 FY22.

Brokerage firm Motilal Oswal projects revenue in rupee terms to grow by 24.9% Y-o-Y to ₹32,900 crore in Q4FY22. It expects a profit of ₹6,080 crore with an annual growth of 19.6%.

For the third quarter ended December 2021, Infosys had reported consolidated revenue from operations of ₹31,867 crore, up 23% from ₹25,927 crore in the corresponding period last fiscal. The net profit after tax stood at ₹5,809 crore, up 12% over the same period last year.

Ahead of its Q4 results, global research firm Jefferies has maintained a buy call on the stock with a target at ₹2,135 per share. Meanwhile, ICICI Direct has given a buy call on the stock with a target price of ₹2,300 for a time period of one year.

In a separate development, Infosys in an exchange filing on Tuesday said it has opened its Melbourne Living Lab part of a network of over 20 established globally to date. The Melbourne Living Lab offers over 800 square metre of co-creation space designed to advance people and ESG centric digital innovation.

“Led by its Centre for Emerging Technologies, these solution accelerators leverage digital technologies including Cloud, 5G, IoT, 3D, AI, Cyber Security, Data & Analytics, AR, VR and address industry use cases in Financial Services, Telcos, Retail, Utilities, Manufacturing, Sports Tech, Edu Tech, among others,” Infosys said in a release.

Following the launch of its Metaverse foundry, the Infosys Melbourne living lab will also enable Infosys partners to test and incubate extended reality experiences in a 360-degree digital-donut, Infosys’ Virtual Living Lab and virtual reality zones.