Dolat Capital is bullish on Infosys and has recommended 'Accumulate' rating on the stock with a target price of Rs 3875 in its research report dated July 11, 2014.
"We believe the strong volume growth (2.9% QQ), better outlook (commentary and deal TCV of $700mn), improved trajectory (management has indicated better H2 to be better than H1) and end to the overhang on who would cap the top job would mean improved sentiment for the company. The have broadly maintained our estimates with a Revenue/earnings CAGR of 11%/14% over FY14-16E but believe the stock has re-rating potential given the declining growth differential, improved profitability and widened discount to TCS. We maintain our Marketperform rating on the stock with a TP to INR 3875 valued at 16x FY16E earnings.
Infosys reported inline revenue growth of 2% QQ at $2.13bn (Reported currency revenues at Rs 127.7bn - DE at Rs 128bn). Operating profits were better than estimate as change in depreciation (useful life of asset increased aligned to company law act) covered up for adverse impact of wage/visa/Fx impact. Profit were down by 3.5% QQ at Rs 28.8bn inline with our estimates of Rs 28.6bn owing to higher tax rate than estimates.
Infy has maintained its annual $ revenues guidance of 7-9% CC growth for FY15 despite strong volume growth if 2.9% during the quarter. We believe if the pricing remain stbale hereon then Infy stand a clear chance to up its revenue growth as he has been expecting better H2 over H1. The company has added $700mn of deal TCV through five large deals (2 in US/Europe each and 1 in ROW) and has been indicating relatively improved outlook for most of the verticals except for HiTech.
Valuation: The stock has been underperforming the peers owing to past KMP exits/ earning warning in last quarter, however we believe the stock should do better than the earnings growth due to likely improved sentiment and confidence restoration post joining of an external CEO – Vishal Sikka. We maintain our Marketperformer stance on the stock with a TP of Rs 3875 valued at 18.5x/16x on FY15/16E earnings", says Dolat Capital research report.
For all recommendations, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
To read the full report click here
Anda sedang membaca artikel tentang
Accumulate Infosys; target of Rs 3875: Dolat Capital
Dengan url
http://harmonisem.blogspot.com/2014/07/accumulate-infosys-target-of-rs-3875.html?m=0
Anda boleh menyebar luaskannya atau mengcopy paste-nya
Accumulate Infosys; target of Rs 3875: Dolat Capital
namun jangan lupa untuk meletakkan link
Accumulate Infosys; target of Rs 3875: Dolat Capital
sebagai sumbernya
0 komentar:
Posting Komentar