Anand Rathi Rates Infosys 'Buy,' Sees 17% Upside to ₹1,884

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AuthorRiya Kapoor|Published at:
Anand Rathi Rates Infosys 'Buy,' Sees 17% Upside to ₹1,884
Overview

Anand Rathi has initiated coverage on Infosys with a 'Buy' rating and a target price of ₹1,884, signaling a potential 17.1% upside from current levels. The brokerage cites resilient performance, a significant deal pipeline including a large NHS contract, and an upgraded FY26 revenue guidance to 3-3.5%. Infosys' structured commercialization roadmap, particularly in GenAI, positions it strongly among Indian IT peers.

Anand Rathi Initiates Buy Call

Anand Rathi initiated coverage on Infosys with a 'Buy' recommendation and set a price target of ₹1,884, anticipating a 17.1% climb from its current market price. The report highlights the IT giant's robust performance in a seasonally slow quarter.

Robust Deal Wins and Guidance Boost

Infosys posted a 0.6% quarter-on-quarter revenue growth in constant currency terms. Crucially, the company secured a substantial deal pipeline with a total contract value (TCV) of $4.8 billion, a significant 92% year-on-year increase. This included a large $1.6 billion NHS deal.

Management has raised the fiscal year 2026 (FY26) revenue guidance to a range of 3% to 3.5%, an upward revision from the previous 2% to 3% projection. The company expects even stronger growth in FY27, driven by an anticipated increase in discretionary spending and continued deal traction in the Financial Services (FS) and Energy & Utilities (E&U) sectors.

Strategic GenAI Focus

The report emphasizes Infosys's strategic focus on Artificial Intelligence. Its partnership with Cognition, the Topaz fabric for AI agent deployment, and approximately 4,600 Generative AI projects demonstrate a clear commercialization strategy. This positions Infosys as a leading partner for GenAI-led digital transformations in the Indian IT sector.

Revised Estimates and Target Price

Anand Rathi has adjusted its revenue and earnings per share (EPS) estimates for FY26, FY27, and FY28. The brokerage now projects a compound annual growth rate (CAGR) of 7.9% for adjusted EPS between FY26 and FY28. At the current market price, Infosys is trading at a forward price-to-earnings (P/E) multiple of 20.4x for FY27 and 19.2x for FY28. The price target of ₹1,884 suggests a valuation that reflects the company's growth prospects and strategic positioning.

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