Following the footsteps of TCS and HCL Technologies, which posted better-than-expected Q1 FY25 results last week, market expectations are high for Infosys. Investors are keen to see how the company translates its recent large deal wins into revenue and what guidance it offers for the future.
Market experts have shared their insights on what to expect from Infosys. Manish Chowdhury, Head of Research at StoxBox, anticipates a rebound in revenue growth of 3% sequentially in constant currency terms, driven by the ramp-up of large deals won in FY24. Chowdhury expects modest margin expansion supported by operational efficiencies and strong growth.
The focus will be on how effectively Infosys can convert these large deals into revenue. Additionally, investors are waiting for management’s comments on any adjustments to FY25 revenue growth guidance, the discretionary spending environment, senior management attrition, and the impact of mega deals.
Avinash Gorakshkar, Head of Research at Profitmart Securities, compared Infosys’s upcoming results with those of TCS and HCL Technologies. Last week, TCS and HCL Tech announced their Q1FY25 results, with TCS emerging as the standout performer. The market now turns its attention to Infosys, which has reported significant deal wins in recent quarters.
Gorakshkar emphasizes the importance of seeing how these deals translate into revenue for the company. He also notes that easing US inflation and potential US Federal Reserve rate cuts could influence Infosys’s future business prospects. Therefore, while Infosys’s Q1FY25 results are crucial, the company’s business guidance and the US economic outlook will also significantly impact the movement of Infosys shares.
Sumeet Bagadia, Executive Director at Choice Broking, shared his views on Infosys’s share price. According to Bagadia, Infosys has established a strong base at ₹1675, with resistance at ₹1800. He predicts that Infosys’s share price could reach ₹1850 if it breaches this resistance.
Bagadia advises current shareholders to hold the stock, maintaining a stop loss at ₹1675. For new investors, he recommends buying Infosys shares at the current price with immediate targets of ₹1800 and ₹1850, maintaining a strict stop loss at ₹1675, and adding more if the shares stay above this level.
Reflecting on TCS’s recent performance, the company reported a healthy 9% year-on-year rise in Q1FY25 net profit, aligning with market expectations. TCS exceeded expectations on several fronts, with all significant markets and almost all verticals returning to sequential growth during the quarter.
HCL Tech also reported robust growth in Q1FY25, with a 20.45% increase in net profit to ₹4,257 crore compared to ₹3,534 crore in the same quarter the previous year. HCL Tech’s revenue from operations rose by 6.69% to ₹28,057 crore in Q1FY25, surpassing market expectations.
As Infosys prepares to release its Q1 results, the market will be closely watching to see how the company performs relative to its peers and how its strategic deals impact its financial performance. The results and subsequent guidance will be crucial in determining the trajectory of Infosys shares in the coming months.
