9 April 2024 – In a notable turn of events, Infosys experienced a substantial 2% surge on April 9, emerging as the top gainer on the Nifty index. This surge came on the heels of an encouraging upgrade by BofA, which revised its rating for Infosys from “neutral” to “buy.”
The revised target unveiled by BofA indicates a potential upside of approximately 21% from the current stock price, signaling a bullish outlook for Infosys’s future trajectory.
BofA’s decision to upgrade Infosys was underpinned by a positive outlook on the company’s prospects, foreseeing a resurgence in demand by CY25. Additionally, the institution anticipates a normalization of IT spending post the COVID-19 pandemic and a rise in regulatory tech expenditures by banks, factors that could further bolster Infosys’s performance.
Furthermore, BofA highlighted the significance of the SAP upgrade deadline and predicted an increase in transformational IT spending following the US elections. The upcoming earnings release is poised to provide insights into Infosys’s performance for CY24.
Despite the recent surge, Infosys has encountered a 2% decline in its stock value this year, trailing behind the Nifty IT index. Nevertheless, analysts maintain optimism regarding Infosys’s long-term growth prospects, especially with the impending release of its March quarter results on April 18.
Analysts anticipate a subdued quarter for Infosys, attributed to factors such as elevated wage costs and the absence of significant deals. However, they project the company to guide for a 3-6% constant currency revenue growth for FY25, slightly below market expectations of 7%.
