Brokers cut Infosys targets by 4-7 percent but still remain bullish

15 Apr , 2022 By : Kanchan Joshi

Mumbai : Brokerages cut target prices on Infosys by 4-7 percent after the fourth quarter numbers came in below expectations. However, they remain bullish on the company due to encouraging FY23 growth guidance and large bookings in the financial year ended March.

The American Depository Receipts of Infosys listed on the US bourses fell 6% later on Wednesday after the results. Earlier during the day on Wednesday, the stock ended up 0. 4% at Rs 1. 748. 65 on the BSE.

Trimming FY23 and FY24 earnings estimates by 3-6% due to cost pressures, Jefferies has cut target price to Rs2,050 from Rs 2,135 but maintained ‘buy’ rating on strong demand outlook.

Jefferies pointed out that the stock may correct post the earnings but whenever Infosys has traded at a 10% discountto TCS, its stock has outperformed TCS by 10% in the following 12 months.

Morgan Stanley has lowered target price to Rs 1,970 from Rs 2,050 while maintaining an overweight stance. JP Morgan has lowered target price to Rs 2,200 from Rs 2,300 following a 5-7% cut in estimates while retaining overweight rating.

“Infosys remains our top pick in the sector and stays best positioned to capture share in this growth cycle,” said JP Morgan.

Citi has trimmed target price to Rs 2,010 from Rs 2,155 with a ‘buy’ rating and CLSA has maintained ‘buy’ with a target price of Rs 2,040. Investec has retained a hold with a target price of Rs1,705, revised down from Rs 1,790.