Infosys reported 1QFY2015 results with operating margins and net profit stood ahead of our expectations and top-line came inline with estimates. Volume growth was modest at 2.9% q-o-q while realization dropped sequentially by 0.4%. The management has kept its FY15 USD revenue growth guidance unchanged at 7-9% implying CQGR of 2.3-3.5% for the next three quarters.
Commenting on the results, Marwadi Shares & Finance (MSFL), said, ''While the improvement in IT spending outlook for CY2014 does bode well for the FY2015E revenue outlook of the sector in general and Infosys in specific, we believe Infosys will continue to lag behind its tier-I peers like TCS and HCL Tech on revenue growth.
We expect Infosys to post a 8.5% USD revenue growth in FY15. Over FY14-16E, we expect USD and INR revenue to grow at a CAGR of 9.5% and 8.8%, respectively. PAT CAGR for Infosys is expected to be softer than peer companies at 10% over FY14-16E. We maintain Accumulate rating on the stock with target price of Rs 3,600.''
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