Infosys sinks 4% after FY27 guidance cut; 5 brokerages decode the outlook
Infosys shares fell sharply on Monday after the IT major cut its FY27 revenue growth guidance to 1-2% from 1.5-3%, citing pricing pressure and a challenging demand environment. While Nomura remains bullish, Goldman Sachs, Morgan Stanley, Citi and Choice Institutional Equities flag growth concerns, with differing ratings and target prices.
Infosys shares plummeted nearly 4% to Rs 1,107 on the NSE following the company's reduced guidance for the fiscal year 2027 (FY27). The IT services giant reported a modest 6% year-on-year growth in its consolidated net profit at Rs 7,823 crore for Q2, compared to Rs 7,364 crore in the previous year. In response to a challenging demand environment, Infosys lowered its revenue growth guidance to 1-2% in constant currency for FY27, down from the earlier range of 1.5-3%.
The company's revenue from operations in the reporting period rose 11% year-on-year to Rs 49,244 crore. Analysts decode Infosys outlook after FY27 guidance cut: Nomura maintains a Buy rating with a target price of Rs 1,300, implying a 12.5% upside; Goldman Sachs holds a Neutral rating with a Rs 1,000 target; Morgan Stanley ups its target price to Rs 1,075 from Rs 976, down 6.88% from the closing price; Citi raises its target price to Rs 1,105 from Rs 1,030, indicating a 4.29% downside; Choice Institutional Equities retains a 'Reduce' rating with an estimated FY28E/FY29E EPS at 13x the average; and Margins are projected to remain range-bound due to pricing pressures from heightened competition.
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