Infosys is set to release its Q2 FY25 results, and several brokerages have shared their expectations regarding the company’s performance.
JM Financial anticipates a 10 basis points (bps) QoQ cross-currency tailwind, which should positively impact growth. They project a contribution of USD 46 million (approximately 1% of consolidated growth) from the Intech acquisition. While JM Financial sees potential margin pressures from large deal ramp-ups and increased hiring, they believe these challenges could be mitigated by sub-contractor optimization and the positive effects of value-based selling. They expect Infosys to revise its revenue growth guidance for FY25 to 4-5% YoY in constant currency (cc), with Q3 and Q4 growth expected at 0-1%.
Phillip Capital forecasts a 2.6% QoQ revenue growth in constant currency, driven by the continued ramp-up of large deals, the integration of Intech (estimated to contribute about 1%), and a recovery in the BFSI vertical. They project a 30 bps improvement in EBIT margins, attributed to strong growth and operational efficiencies from Project Maximus. Phillip Capital also believes Infosys will likely raise its FY25 growth guidance to 4-5% YoY in constant currency from the previous 3-4% while maintaining EBIT margin guidance at 20-22%.
HDFC Securities suggests that Infosys’s growth could include approximately 1 percentage point from the Intech acquisition, indicating a potential upgrade in guidance to 4-5%. They highlight improved outlooks for BFSI, gains in market share in the Communications sector, and better hiring trends as positive factors for the company.
Sharekhan expects Infosys to report a 3.2% revenue growth in constant currency terms QoQ, with cross-currency tailwinds of about 70 bps, leading to an overall reported growth of 3.9%. They predict a ~25 bps improvement in EBIT margins due to operational efficiencies.
In the previous quarter (Q1 FY25), Infosys had already increased its FY25 revenue growth guidance to 3-4% in constant currency, with an EBIT margin target of 20-22%. Overall, these insights reflect a cautiously optimistic outlook for Infosys as it navigates through a dynamic market environment.
Disclaimer: The information provided in this preview is based on the expectations and analyses of various brokerages and financial institutions regarding Infosys’s Q2 FY25 results. These projections are subject to change based on market conditions and company performance. Investors should conduct their own research and consider their financial situation before making investment decisions. The views expressed do not constitute financial advice.
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