INFY - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.5
| Stock Code | INFY | Market Cap | 4,79,294 Cr. | Current Price | 1,182 ₹ | High / Low | 1,728 ₹ |
| Stock P/E | 16.0 | Book Value | 199 ₹ | Dividend Yield | 4.06 % | ROCE | 45.6 % |
| ROE | 35.7 % | Face Value | 5.00 ₹ | DMA 50 | 1,310 ₹ | DMA 200 | 1,463 ₹ |
| Chg in FII Hold | -1.82 % | Chg in DII Hold | 2.11 % | PAT Qtr | 7,975 Cr. | PAT Prev Qtr | 8,202 Cr. |
| RSI | 35.9 | MACD | -37.0 | Volume | 1,34,87,173 | Avg Vol 1Wk | 1,39,49,961 |
| Low price | 1,150 ₹ | High price | 1,728 ₹ | PEG Ratio | 1.81 | Debt to equity | 0.05 |
| 52w Index | 5.53 % | Qtr Profit Var | 20.3 % | EPS | 72.0 ₹ | Industry PE | 21.6 |
Financials: Infosys demonstrates strong profitability with ROCE at 45.6% and ROE at 35.7%. EPS of ₹72.0 and quarterly PAT of ₹7,975 Cr. highlight consistent earnings power. Debt-to-equity ratio of 0.05 ensures balance sheet strength.
Valuation: P/E of 16.0 is below industry average (21.6), suggesting undervaluation. PEG ratio of 1.81 indicates fair growth-adjusted pricing. Dividend yield of 4.06% adds to investor appeal.
Business Model: Infosys remains a leader in IT services, leveraging digital transformation demand, global client base, and strong cash flows.
Entry Zone: Attractive entry between ₹1,150–₹1,200 given oversold RSI (35.9) and MACD weakness. Long-term holding is favorable due to strong fundamentals and dividend yield.
Positive
- High ROE (35.7%) and ROCE (45.6%) show efficient capital use
- Strong EPS of ₹72.0 supports valuation
- Dividend yield of 4.06% ensures steady returns
- P/E below industry average indicates undervaluation
Limitation
- RSI at 35.9 and MACD at -37.0 reflect weak momentum
- Quarterly PAT declined from ₹8,202 Cr. to ₹7,975 Cr.
- FII holdings reduced (-1.82%), showing cautious foreign sentiment
Company Negative News
- Marginal decline in quarterly profits
- Weak technical momentum with bearish indicators
Company Positive News
- Strong dividend payouts continue to attract investors
- DII holdings increased (+2.11%), showing domestic confidence
Industry
- IT sector resilient with ongoing digital transformation demand
- Industry P/E at 21.6 highlights Infosys trading at discount
Conclusion
Infosys is fundamentally strong, with efficient capital use, robust profitability, and attractive valuations. Despite short-term technical weakness, the stock offers a compelling entry zone around ₹1,150–₹1,200. Long-term investors can benefit from consistent dividends, strong ROE/ROCE, and sector resilience.
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