Infosys share price jumps 5% to hit a fresh 52-week high on Q1 boost; should you buy, sell or hold?

Infosys share price: Shares of India's second-largest IT firm, Infosys, jumped nearly 5 per cent to hit a fresh 52-week high of ₹1,843 in early trade on BSE on Friday, July 19, a day after the company reported a better-than-expected April-June quarter (Q1FY25) scorecard. Infosys share price opened at ₹1,842.05 against its previous close of ₹1,759.15 and rose 4.8 per cent to touch its 52-week high of ₹1,843. Around 9:20 am, the stock traded 3.52 per cent higher at ₹1,821 apiece.

The stock has seen a healthy gain this year, slightly outperforming the equity benchmark Sensex. Till July 18, Infosys shares had gained about 14 per cent this year against a nearly 13 per cent gain in the Sensex.

Infosys Q1 results

Infosys reported a 7.1 per cent year-on-year (YoY) rise in consolidated profit after tax (PAT) to ₹6,368 crore for Q1FY25, against ₹5,945 crore in the same quarter last year.

Revenue from operations for the quarter rose to ₹39,315 crore, marking a 3.6 per cent YoY growth from ₹37,933 crore in the corresponding quarter last year.

The positive surprise was the upward revision in revenue growth guidance. Infosys expects constant currency revenue growth of 3-4 per cent for FY25. In the previous quarter (Q4FY24), Infosys had slashed its revenue guidance to 1-3 per cent for FY25, highlighting uncertain demand conditions.

The company, however, maintained the operating margin guidance, ranging from 20 per cent to 22 per cent in FY25.

Moreover, the company reported a 4.6 per cent fall in attrition rate in Q1FY25 compared to the same period last year.

What should investors do?

Most brokerage firms hailed Infosys' Q1 numbers and reiterated their positive outlook about the stock. They expect a healthy upside in the stock price from the current levels.

Motilal Oswal Financial Services maintained a buy call on the stock with a target price of ₹2,000.

Motilal expects Infosys to be a key beneficiary of the acceleration in IT spending in the medium term. The brokerage firm underscored that Infosys' FY25 revenue growth guidance upgrade was largely driven by a one-time India business spike and inorganic impact, but strong deal wins should improve its medium-term growth outlook.

"It has maintained its margin guidance but continues to see upside potential in the medium term, which we see as encouraging," Motilal said.

Nuvama Wealth Management kept a buy call on the stock but raised the target price to ₹2,050 from ₹1,720.

Nuvama underscored Infosys delivered solid Q1FY25 results and upgraded its guidance. Management appears upbeat about the recovery in growth profile, though a bit guarded, too, as discretionary spending remains largely on hold.

"We reckon Infosys will benefit disproportionately in FY25/26—from the revival in discretionary spends—just like it suffered disproportionately (versus peers) in FY24. We view it as one of the best ways to play the revival in the IT sector over the next few years," said Nuvama.

Increasing estimates, HDFC Securities maintained an 'add' call on the stock with a target price of ₹1,900, based on 25 times Jun-26E EPS.

HDFC observed that Infosys’ Q1 sprung a positive surprise on the growth front, led by a revival in the BFSI vertical and an improvement in deal conversion to revenue.

"The magnitude of outperformance increases the certainty of guidance top-end and perhaps even upside risk to growth estimates, which may keep the valuation multiples elevated. Positive commentary on US BFSI can just be the start of the growth revival – TCS/LTIM commentary also had shades of this," HDFC Securities said.

Among the global brokerage firms, Nomura maintained a buy call on Infosys with a target price of ₹1,950, citing Infosys' Q1 results were an all-round beat, reported CNBC-TV18.

As per CNBC-TV18, Nomura raised its FY-25-26 EPS estimates by nearly 2-3 per cent, underscoring surprise revenue guidance, deal wins, and acquisition integration.

Jefferies also maintained a buy call on the stock with a target price of ₹2,040. It said the initial signs of recovery in BFSI, strong deal wins, and an all-round improvement in operating performance suggest the worst is behind, reported CNBC-TV18.

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