Reduce Infosys - Geojit BNP Paribas

Maintain 'reduce' rating on Infosys – TP Rs.2500

- Company's 4QFY12 USD revenue declined 1.9% qoq, as against guidance of 0-0- 0.02% increase.

- EBIT missed market estimates buy EPS was in line with expectations due to higher other income.

- The guidance for FY13 of USD revenue growth of 8-10% and EPS estimate of Rs.159 – Rs.161 looks poor.

- Estimates and rating on the scrip are under review due to weak outlook.

- Guidance for FY13 is with the anticipation of 0-1% qoq revenue growth in 1Q and 4-5% qoq revenue growth in 2Q–Q4.

- Poor EPS outlook for FY13 does not factor in any wage hike and it is due to worries regarding poor demand, which is an industry- wise worry.

- Retain 'reduce' rating on the stock with the earlier target price of Rs.2500 over one year.

Source : Equity Bulls

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