Prabhudas Lilladher (PL) has retained 'Buy' on Infosys with revised target price of Rs 4,040 from Rs 3,920 as against current market price (CMP) of Rs 3,327 in its report.

Commenting on the investment rationale, PL said,''Infosys' performance in Q1FY15 was a mixed‐bag, with softer revenues but margins touchahead of expectation. Volume growth tracked better than consensus expectation with uptick in onsite volume, along with benefits of 'Cost Optimization' initiatives. We expect earnings upgrade driven by margin revision. We retain 'Buy'

We expect new strategic initiatives to be announced by Infosys under the new leadership of Dr. Vishal Sikka. However, in the near term, we see more tailwinds for margins to be played out in FY15. We see no downside risks to our estimates. We revise our target price to Rs 4,040 (from: Rs 3,920), 17x FY16e earnings estimate.''

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