Infosys, India's second largest software exporter,  reported strong broad-based growth of 4.8% QoQ CC, beating estimate of 3.9%. Deal TCV stood at USD 2.6 billion, implying a growth of 48% YoY. EBIT margin fell 80bp QoQ to 23.7% in 1QFY22 (est. 24.8%), due to higher employee and subcontracting expenses. The management increased its FY22 USD revenue growth guidance to 14-16% CC YoY from 12-14%.

Post Infosys Q1FY22 result, Motilal Oswal Institutional Equities expects Infosys to deliver another year of an ongoing guidance raise as the current one does not fully factor in strong technology demand and execution of its record high deal wins. "We have cut our FY22E/FY23E EPS estimate by 3.2%/1.6% to encompass margin pressure due to ongoing supply crunch in the industry and expected increase in travel expenses."

"We continue to view Infosys as a key beneficiary of a recovery in IT spends in FY22, given its capabilities around Cloud and Digital transformation. We value Infosys at 27x FY23E EPS and reiterate our Buy rating," the broking firm added.

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