Infosys Shares Drop Over 3% Following Q4 Results Amid Mixed Analyst Reactions
Infosys shares fall over 3% after Q4 results. What Morgan Stanley, other top brokerages are saying
The Economic TimesImage: The Economic Times
Shares of Infosys, an Indian IT giant, fell by 3.3% after reporting a 21% year-on-year rise in consolidated net profit for Q4 FY26, totaling ₹8,501 crore. Analysts expressed concerns over a weaker-than-expected revenue growth outlook for FY27, ranging from 1.5% to 3.5% in constant currency.
- 01Infosys reported a 21% year-on-year increase in net profit for Q4 FY26.
- 02Revenue for the quarter was ₹46,402 crore, a 13.4% increase from the previous year.
- 03Analysts are concerned about the FY27 revenue growth guidance of 1.5% to 3.5%.
- 04Morgan Stanley and Jefferies adjusted their target prices downward due to disappointing results.
- 05HDFC Securities and Motilal Oswal maintained buy ratings despite concerns over growth.
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Shares of Infosys Limited, a major player in India's IT sector, declined by 3.3% to ₹1,199 following the release of its Q4 FY26 results. The company reported a consolidated net profit of ₹8,501 crore, reflecting a 21% increase compared to ₹7,033 crore in the same quarter last year. Revenue from operations reached ₹46,402 crore, marking a 13.4% rise year-on-year. However, the company's guidance for FY27 revenue growth of 1.5% to 3.5% in constant currency has raised concerns among analysts. Morgan Stanley lowered its target price from ₹1,760 to ₹1,380, while Jefferies cut its target to ₹1,235, citing a weak revenue outlook and a 19% year-on-year drop in new deal wins. Conversely, Motilal Oswal retained a buy rating with a target price of ₹1,450, indicating a 17% upside from current levels, despite acknowledging pressures from AI adoption and competition. HDFC Securities also maintained a buy rating with a target of ₹1,550, noting that the demand environment remains soft as clients focus on cost optimization. Overall, while Infosys's profit figures are strong, the cautious growth outlook has led to mixed reactions from analysts.
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The decline in Infosys shares and the cautious revenue outlook may impact investor confidence and the company's market position in the competitive IT sector.
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