Stock market today: Infosys shares will be in focus today as the Indian IT major will declare its Q1 results today. Like other IT majors, Tata Consultancy Services (TCS) and HCL Technologies already delivered better-than-expected Q1 FY25 results last week, and the market is expecting similar results from Infosys.
According to stock market experts, investors should focus on translating revenue from the large deals the company has executed and will execute in FY25. So, guidance will also be a factor for investors.
Speaking on the kind of numbers one can expect from Infosys in the first quarter of the current financial year, Manish Chowdhury, Head of Research at StoxBox, said, “Infosys' revenue growth is expected to rebound to 3% sequentially in CC terms due to the ramp-up of large deals won in FY24. We expect modest margin expansion led by strong growth and operational efficiencies. We expect a large deal of TCV to be robust in Q1. The focus will be translating revenues from large deals signed in earlier quarters into revenues. We await management commentary on any tweaks to FY25 revenue growth guidance and the discretionary spending environment, especially in impacted verticals, senior management attrition, and translating mega deals into revenues.”
On whether the company will be able to deliver TCS and HCL Technologies-like results, Avinash Gorakshkar, Head of Research at Profitmart Securities, said, "Last week, TCS and HCL Tech declared its Q1FY25 results, and TCS was a clear winner among the two. Now, the market is looking at Infosys as the Indian IT major has declared big deal wins in the previous quarters. However, seeing how it has translated into the cash-rich company's revenue would be important. Easing US inflation and US Fed rate cut buzz is also expected to affect the company's future business outlook. So, Infosys results for Q1FY25 won't be the only factor that will play its role in the movement of Infosys shares. Business guidance and outlook for the US economy would be other important factors that will dictate the movement of Indian IT stocks."
Regarding Infosys's share price outlook, Sumeer Bagadia, Executive Director at Choice Broking, said, “Infosys's share price has made a strong base at ₹1675 while the Indian IT major is facing hurdle at ₹1800. Infy's share price may touch ₹1850 soon in breach of this resistance. So, Infosys shareholders are advised to hold the scrip, maintaining a stop loss at ₹1675.”
On the suggestion to fresh investors, Bagadia said, "One can buy Infosys shares at the current price for the immediate target of ₹1800 and ₹1850, maintaining strict stop loss at ₹1675. One can keep on adding more until Infy shares sustain above ₹1675 apiece."
TCS reported a healthy 9 percent year-on-year (YoY) rise in Q1FY25 net profit, broadly in line with market expectations. On some parameters, the company exceeded market expectations. For example, it said all significant markets and almost all verticals returned to sequential growth during the quarter.
HCL Tech reported robust growth during the first quarter of the financial year 2024-25. The IT major reported a 20.45 percent increase in net profit to ₹4,257 crore compared to ₹3,534 crore in the same quarter the previous year. The company's revenue from operations rose 6.69 percent to ₹28,057 crore in Q1FY2025, compared to ₹26,296 crore in Q1FY2024. The results beat the market's expectations as the company's net profit and revenue rose in April-June.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
