Infosys hits 52-week high amid optimism on earnings; street expects 2.4% QoQ revenue growth

The optimism partially comes from results from TCS and HCL Tech, which posted market-beating earnings.

Analysts also expect Infosys to post significant sequential revenue growth in Q1 FY25, steered by the ramp-up in large deals. Operating margins are also likely to expand due to cost optimizations.

However, consolidated net profit is anticipated to decline quarter-on-quarter, primarily because a tax refund boosted the previous quarter's net profit. Investors are eagerly awaiting Infosys's earnings release on July 18.

Infosys Q1 earnings preview

According to Moneycontrol, Infosys's revenue is projected to increase by 2.4% quarter-on-quarter to ₹38,850 crore in the fiscal first quarter. In comparison, net profit is expected to decrease by 21.6% quarter-on-quarter to ₹6,248 crore.

In the January-March quarter, Infosys' revenue decreased by 2.3% from the previous quarter, with the EBIT margin contracting to 20.1%. Net profit surged by 30.5% quarter-on-quarter, aided by a tax refund of ₹6,329 crore.

Estimates suggest that Infosys's EBIT margin will rise by 50 basis points quarter-on-quarter to 20.6% in Q1 FY25, supported by the reversal of one-off impacts but slightly offset by deal ramp-up costs.

Investors and market analysts will closely monitor the management's commentary on deal TCV (total contract value) and pipeline, performance across verticals, discretionary client spending, and the effects of macroeconomic headwinds on demand.

Infosys stock performance

The stock hit a 52-week low of ₹1,311.6 on July 27, 2023. The current market price of ₹1729.35 per share, the company’s market capitalisation stands at ₹7.18 lakh crore.

The counter traded higher than the 20, 50 and 200-day simple moving averages (SMAs). The stock has gained 21.5% in the last one year and 15.5% in the past month.

The company's stock has a price-to-equity (P/E) ratio of 26.02x against a price-to-book (P/B) value of 8.73x. Earnings per share (EPS) stood at ₹65.61 with a return on equity of 33.55%, as per the data available on BSE.