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Informist, Wednesday, Jul. 22, 2026

 

By Shakshi Jain

 

NEW DELHI – Infosys Ltd. is expected to post a considerable sequential decline in its consolidated net profit for the June quarter despite a rise in revenue, due to investment and acquisition costs, according to analysts. Revenues are expected to rise moderately, helped by contribution from recently acquired US-based firms Optimum Healthcare and Stratus Global. Organic revenues are expected to grow on the back of deal ramp-ups, brokerages said.

 

The banking and financial services vertical is likely to have led growth in the June quarter, while the retail, manufacturing, and communication segments were under pressure, according to analysts.

 

Infosys' consolidated net profit for the June quarter is expected to decline over 7% sequentially to INR 78.67 billion, according to the average of estimates from 22 brokerages. However, the estimate implies year-on-year growth of almost 14%. The bottom line estimates range from INR 73.33 billion by Yes Securities (India) Ltd. to INR 81.74 billion by Elara Securities (India) Pvt. Ltd.

 

The large-cap firm's consolidated revenue for the reporting quarter is likely to rise over 4% sequentially and nearly 15% on year to INR 484.45 billion, as per the estimates. The highest top line estimate is INR 489.16 billion from Axis Securities Ltd. and the lowest is INR 473.22 billion from Nirmal Bang Equities Pvt. Ltd.

 

"1Q (Apr-Jun) is usually a strong quarter for Infosys and growth starts to moderate in 2H (Oct-Mar) each year. Apart from this, strong large deal signings from FY26 will aid revenue growth," Nirmal Bang said. IDBI Capital Market Services Ltd. said the US banking, financial services, and insurance industry remained resilient in the June quarter, but the deflationary impact of artificial intelligence is likely to have impacted Infosys' top line for the quarter.

 

Meanwhile, PhillipCapital (India) Pvt. Ltd. said the information technology services company is unlikely to have seen an increase in volume, which is typically visible in the June quarter, due to deferred client spending.  

 

In constant currency terms, revenues are expected to rise between 1.4% and 2.4% for the June quarter, according to estimates from 12 brokerages. Analysts anticipate 0.7-1.0% growth in organic revenues for the three months. "We forecast organic revenue growth of 0.9% due to seasonal strength led by additional billing days," Kotak Securities Ltd. said.

 

In dollar terms, Infosys' top line for the reporting quarter is expected to have seen a paltry improvement to $5.12 billion from $5.04 billion for the March quarter, as per the average of 16 estimates. Analysts expect Infosys to post deal wins in the range of $2.5 billion to $4 billion for the June quarter. "We expect it will deliver large-deal TCV (total contract value) in the range of US$3-4bn, which has been the average range over the past 3-4 years," Nirmal Bang said.

 

Infosys had reported a consolidated net profit of INR 85.01 billion for the March quarter on revenues of INR 464.02 billion. It had recorded large deal wins worth $3.2 billion for the quarter.

 

If analysts' consensus estimates hold, Infosys' bottom line will revert to a sequential decline after strong growth in the March quarter. Meanwhile, revenues will sequentially rise for the fifth consecutive quarter and at a better pace than in the trailing two quarters. 

 

MARGIN MOVEMENT

Infosys' earnings before interest and tax margin for the June quarter is estimated at 21.1%, according to the average of 17 estimates. For the March quarter, Infosys had reported an operating margin of 20.9%. The improvement would be on the back of operational efficiencies from Project Maximus and depreciation of the rupee against the dollar, partially offset by acquisition-related costs, brokerages said.

 

"EBIT margin is likely to expand +30bp QoQ (quarter-on-quarter) driven by currency tailwind and lower provision for doubtful debt," Nuvama Wealth Management Ltd. said. Project Maximus is a structural margin-expansion programme launched by Infosys in 2023 to optimise costs and drive profitability.

 

HDFC Securities Ltd., PhillipCapital, and Nomura Financial Advisory & Securities (India) Pvt. Ltd. expect Infosys to maintain its revenue growth guidance of 1.5-3.5% in constant currency terms for financial year 2026-27 (Apr-Mar) alongside the EBIT margin band of 20-22%. "Acquisitions of Versent Group, Optimum Healthcare IT & Stratus will have additional contribution 1.9% for FY27," PhillipCapital said.

 

Motilal Oswal expects Infosys to lower the upper end of the revenue growth guidance by 50 bps to 1.5–3.0%. Nuvama expects an upward revision in the metric to 2.5-4.0%, driven by 1% incremental inorganic contribution for the year. Kotak Securities said it expects the company to maintain the margin guidance for the year but tighten the revenue growth range to 2-3.5%. "The revised guidance will incorporate Optimum Healthcare that will add 120 bps to revenues," it added.

 

Infosys will announce its June quarter results on Thursday. Market participants await management commentary on demand across segments, deal pipeline and conversion, the deflationary impact of artificial intelligence on revenues and margins, conversion of Generative AI programmes from pilots to scaled deployments, and the second-order effects of the war in West Asia. Investors will also keep an eye out for updates tied to large and mega deals, and client-specific issues, if any.

 

On Wednesday, shares of Infosys ended at INR 1,052.10 apiece on the National Stock Exchange, down almost 2% from Tuesday. The stock is down over 15% since the company reported its results for the March quarter and down more than 39% from its 52-week high of INR 1,728, hit on Feb. 3.

 

Of the 20 research reports on the company available with Informist, 17 have a "buy" or an equivalent recommendation on the stock and three have a "hold" call. The average target price of the "buy" recommendation is INR 1,626, which is over 54% higher than the current market price.

 

Following are the June-quarter earnings estimates, in INR billion, for Infosys from 22 brokerages in descending order of the estimate of net profit:

 

Brokerage	Net Sales	Net Profit	Revenue (In $	)EBIT (%)
Elara Securities (India) Pvt. Ltd.	480.87	81.74	5.12
Axis Securities Ltd.	489.16	81.03		21.3
Bank of America Global Research	486.12	80.34
Anand Rathi Share and Stock Brokers Ltd.	485.27	80.27	5.13	21.2
JM Financial Institutional Securities Pvt. Ltd.	485.55	80.08	5.13	21.5
Motilal Oswal Financial Services Ltd.	486.00	80.00	5.13	21.4
Nirmal Bang Equities Pvt. Ltd.	473.22	79.75	5.13	21.3
Prabhudas Lilladher Pvt. Ltd.	488.00	79.30	5.15	20.8
Nuvama Wealth Management Ltd.	487.50	78.90	5.15	21.3
360 ONE Capital Market Pvt. Ltd.	486.76	78.75
Dolat Capital Market Pvt. Ltd.	485.44	78.70	5.12	20.8
IDBI Capital Market Services Ltd.	485.29	78.62	5.13	21.2
Equirus Securities Pvt. Ltd.	485.68	78.52	5.12	21.1
HDFC Securities Ltd.	484.08	78.35	5.11	21
PhillipCapital (India) Pvt. Ltd.	485.52	78.34	5.13	21.3
Indsec Securities and Finance Ltd.	483.20	78.10	5.07	21
Centrum Broking Ltd.	483.94	78.06		20.7
ICICI Securities Ltd.	486.00	77.65	5.12	20.8
Kotak Securities Ltd.	486.14	77.05	5.13	21
Emkay Global Financial Services Ltd.	487.91	76.97
Nomura Equity Research	480.87	76.80	5.12	20.5
YES Securities (India) Ltd.	475.51	73.33
Average	484.45	78.67	5,123.92	21.07

 

End

 

US$1 = INR 96.57

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Avishek Dutta

 

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