Infosys Stock Declines by Over 3% Following Q4 Earnings, Weighed Down by Weak Guidance and Mixed Brokerage Views

Infosys Shares Fall 3.1 Percent After Reporting Subdued Growth Outlook

Infosys Ltd shares declined 3.1 percent in early trade on Friday, making it the top Nifty loser, following the company's Q4 FY26 results and a subdued growth outlook. The stock traded at Rs 1,202.6 at around 9:16 am, compared with its previous close of Rs 1,231.8 on NSE.

The IT giant's ADR had already declined 4.01 percent overnight following the results announcement, signaling a weak start for the stock. Despite this, Infosys reported a strong January-March quarter on the bottom line, with net profit rising 27.8 percent quarter-on-quarter to Rs 8,501 crore, aided by margin expansion and lower tax outgo. However, revenue growth remained modest at 2 percent sequentially, while FY27 guidance came in at 1.5-3.5 percent constant currency growth, indicating continued demand uncertainty.

Brokerages flagged the weak growth outlook as a key concern. Citi maintained a 'neutral' rating and cut its target price to Rs 1,300, citing revenue and margin miss along with slower decision-making and rising competition. Jefferies also retained a 'hold' rating with a target price of Rs 1,235, stating that weak guidance, lower deal wins, and headcount decline could weigh on growth. Motilal Oswal highlighted a tough outlook, pointing to AI-led deflationary pressures and a 33 percent sequential decline in total contract value (TCV).

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However, some brokerages remained constructive. Nomura and HSBC retained 'buy' ratings, citing stable margins, expected recovery driven by deal wins and AI partnerships, and potential upside if growth trends move towards the upper end of guidance.

Infosys stock has declined 16.3 percent over the past one year, compared with a 0.3 percent decline in the Nifty 50. The company's market capitalization stands at around Rs 5.15 lakh crore.