Buy Infosys with a target of Rs 2217: Brisc PCG

Broking house, Brisc PCG has recommended buy rating on Infosys Technologies with a target of Rs 2217.

Brisc PCG report on Infosys Technologies

Phenomenal performance yet again

"In a repeat of the first quarter's strong showing, Infosys has delivered an exceptional Q2FY07 performance, far surpassing our estimates. The company posted a growth of 14.5% in revenues and 17% in net profits during the quarter, which outstrips our growth projections of 10.9% and 5.3% respectively. This represents a YoY increase of 50.4% in revenues and 53.3% in net profits for the company. The bottomline expansion occurred despite a sharp decline in other income from Rs 1.3 billion in Q1FY07 to Rs 660mn on account of the flattish rupee-dollar exchange rate. The quarter witnessed an operating margin expansion of 265 bps along with strong volume growth of 11% and a 1.2% improvement in blended pricing over Q1FY07."

"Infosys' management has revised its FY07 guidance upwards for the second consecutive quarter. Accordingly, Infosys is expected to record revenues in the range of Rs 138.5 -139 billion. We are revising our revenue and EPS estimates upwards and are also hiking our target multiple for Infosys from 25x to 26x on one-year forward earnings, which gives us a target price of Rs 2,217. At this price the stock would trade at 32x as compared to the current 35.9x on the current price of Rs 1,981 on TTM basis. BUY ."

Original story