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Informist, Wednesday, Apr. 16, 2025

By Anjana Therese Antony

MUMBAI – Mildly bearish bets were added in the options chain of information technology major Infosys ahead of the company's quarterly results, due Thursday. The Bengaluru-headquartered company is expected to report muted results owing to slower deal wins in previous quarters and seasonal weakness. Premiums on out-of-the-money call options fell, while those on put contracts rose. There are also increasing worries about the performance of Indian IT companies in the financial year 2025-26 (Apr-Mar) in the wake of the tariff war unleashed by the US on key trading partners, particularly China. Any hit on the US economy is likely to have a ripple effect on Indian IT players as over half their revenue comes from clients in the world's largest economy.

Infosys is likely to post a 2% sequential fall in consolidated net profit to INR 66.67 billion, according to the average of estimates from 19 broking firms. Consolidated revenue is expected to rise 0.5% from the previous quarter to INR 419.68 billion, as per the estimates. Infosys is also widely expected to retain its 20-22% operating margin guidance for FY26, while its revenue growth guidance for the year is seen to be conservative compared to FY25.

The stock closed nearly 1% lower at INR 1,413.10 on the National Stock Exchange Wednesday. In the options chain of Infosys, premiums on INR 1,420-INR 1,500 strike prices declined 10-20% and those on INR 1,400-INR 1,360 put options fell. The highest open interest addition was at INR 1,440 call and INR 1,400 put strikes. These levels are seen, respectively, as the immediate resistance and support for the stock in the near term, a derivatives analyst at a domestic broking firm said. 

Infosys's industry peer Tata Consultancy Services reported similarly muted earnings Thursday. Though the management was slightly optimistic about its performance in FY26 and said it does not expect any major deal cancellation during the financial year, the stock fell as investors worried about the impact of US tariffs on the company's near-term outlook.

Shares of Infosys have a weightage of 5.3% in the Nifty 50. The index closed 0.5% higher Wednesday at 23437.20 points after a volatile trading session. The near-term support for the index is seen at 23400-23300 points and resistance at 23550-23620 points. The options chain of the 50-stock index hints at a further upside, but the rise could be limited as the next phase of US policies remains uncertain. 

In an update, the US announced that China would now face up to 245% import tariff, though it did not specify the goods on which the extraordinary levy would be charged. China has suspended exports of heavy rare earth metals and rare earth magnets in an attempt to limit the supply of key raw materials needed for automakers, aerospace manufacturers, snd semiconductor companies across the world, according to a factsheet released by the US administration. Investors will continue to monitor updates relating to US tarifs and possible retaliation by China. Beijing recently said it would ignore any further tariffs by the US. 

--Nifty 50 Apr closed at 23440.60, up 99.70 points; 3.40-point premium to spot index

--Nifty 50 May closed at 23546.10, up 93.20 points; 108.90-point premium to spot index

--Nifty 50 Jun closed at 23660.00, up 108.60 points; 222.80-point premium to spot index

HDFC Bank, Axis Bank, IndusInd Bank, Infosys, ICICI Bank, Bajaj Finance, State Bank of India, Indian Renewable Energy Development Agency, Zydus Lifesciences, Reliance Industries, Maruti Suzuki India, Dixon Technologies (India), Bharti Airtel, Tata Steel, Lupin, and Tata Consultancy Services were the most active underlying stocks Wednesday.  End

US$1 = INR 85.67

Edited by Rajeev Pai

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