INFY.NS
Infosys Limited (INFY.NS) stands as a major player in the Information Technology sector with a noteworthy market capitalization of ₹7,311.33 billion. The stock's Price-to-Earnings (P/E) ratio is at 27.23, indicating moderate investor confidence in the company's earnings potential relative to its stock price. The Return on Equity (ROE) of 31.40% showcases Infosys's ability to efficiently generate profits from its shareholders' equity, signifying strong managerial effectiveness and overall company profitability, further enhanced by a low debt-to-equity ratio of 9.70, suggesting a conservative approach to leveraging debt.
The company's current ratio of 2.19 indicates a solid ability to cover short-term liabilities, reflecting financial stability. Infosys's operating margin of 21.95% highlights its efficiency in translating revenue into operating income, a positive sign for its day-to-day operational profitability. The free cash flow of ₹22.87 billion further provides Infosys with a strong capacity to reinvest in the business, pursue innovations, or return capital to shareholders.
However, potential investors should take into account the trailing PEG ratio of 3.12, which may suggest that the stock is somewhat overvalued in relation to its growth expectations. With an earnings growth rate of 4.2% and revenue growth of 3.7%, Infosys demonstrates a steady but moderate growth trajectory. Moreover, its EBITDA margin of 23.03% emphasizes robust operating profitability.
A noteworthy feature is that 50.50% of Infosys shares are held by institutional investors, indicating a significant level of confidence from large-scale investors in the company's future performance. While the Price-to-Book ratio stands high at 675.95, which could imply a premium valuation, Infosys's consistent growth and financial health make it an attractive proposition for long-term investors seeking stability and moderate returns.
Overall, this analysis delineates Infosys Limited's solid financial footing and strategic position within the IT industry, presenting both opportunities and considerations for potential investors.
Last Updated: January 14, 2025
| Metric | Value |
|---|---|
| Market Cap | 8075.51 B |
| P/E Ratio | 29.24 |
| ROE | 31.40 % |
| Debt to Equity | 9.697 |
| Operating Margin | 21.95 % |
| Free Cash Flow | 2.29 B |
| Institutional Holdings | 50.53 % |
| Revenue Growth | 3.70 % |
Infosys faces competition from various regions and sectors within the IT services industry:
- Traditional IT Services: Competitors include both international giants and regional players.
- Digital Transformation: The shift towards digital has heightened competition in this space.
- Consulting and Advisory: Intense competition from firms that combine IT services with strategic consulting.
Infosys has maintained a solid reputation in the IT services industry with its emphasis on strategic investments in emerging technologies, strong client relationships, and consistent financial performance. However, the company also faces challenges from well-established international and regional players, especially in the rapidly evolving digital and consulting spaces. Potential investors should consider Infosys's adaptability in the digital era and its ongoing commitment to sustainable practices and corporate governance as key competitive advantages.
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