Fundamental

INFOSYS Q1FY20 RESULT UPDATE



Infosys management has raised its CC revenue guidance to 8.5-10% for FY20E, which is mostly in line with our estimate of 8-10%. Despite cross currency headwinds and wage hike impact, Infosys maintained its EBIT margin guidance at 21-23% for FY20E, which is a tad higher than our estimate of 21.3% for FY20E. After factoring in Q1FY20 results we have revised our FY20E estimates slightly downwards and introduced FY21E estimates. At CMP of Rs 727, Infosys is trading at a P/E of 18.9x and 16.9x its FY20E and FY21E earnings respectively. We have rolled over our target multiple to FY21E and now value the stock at 19.5x FY21E earnings (21.5x FY20E earlier) which yields a target price of Rs 840. Maintain Accumulate.


Tags: FundamentalResult Update


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