Infosys posted a modest rise in revenue for the March quarter and lifted its outlook for the full fiscal year, which could be good news for shareholders.
Quarterly earnings beat expectations
The company reported revenue of $5.1 billion for Q3 FY26, a 0.6% increase from the previous quarter and 1.7% higher than a year ago. This was better than analysts expected (they had forecast a 0.3% rise).
Adjusted EBIT margin was 21.2%, matching the estimate of 21.1%. Adjusted EBIT came in at ₹96 billion, just above the ₹95 billion forecast, and adjusted profit after tax (PAT) reached ₹76 billion, beating the ₹73 billion estimate.
The results exclude a ₹12.8 billion charge related to new labor‑code rules on gratuity and leave liabilities.
Guidance upgrade and big deals
- Management now expects FY26 constant‑currency revenue to grow 3‑3.5% (up from 2‑3%).
- The ask rate for the top end of guidance in Q4 FY26 is now expected to stay flat, instead of a 1% decline.
- Large‑deal total contract value (TCV) rose to $4.8 billion, a 55% jump quarter‑over‑quarter.
- The book‑to‑bill ratio was 0.9x, and net new TCV grew 32% QoQ.
Year‑to‑date performance
For the first nine months of FY26, revenue, adjusted EBIT and adjusted PAT grew 8.3%, 7.5% and 11.3% year‑over‑year (in rupee terms). The firm expects Q4 FY26 to deliver 12.2% revenue growth, 14% EBIT growth and 9.4% PAT growth compared with the same quarter last year.
Valuation and recommendation
Analysts value Infosys at 26 times its projected FY28 earnings per share, giving a target price of ₹2,200. That suggests a potential upside of about 37% from the current price. The stock remains a top pick among large‑cap IT companies, and the recommendation is a BUY.
Disclaimer
Remember, this is my view, not a prediction. Do your own research and consider consulting a qualified financial adviser before making any investment decisions.