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Check Before You Invest : Infosys Ltd

BSE: 500209 NSE: INFY ISIN: INE009A01021
  |   Sector:  IT & ITES   |   Industry:  IT - Software

Snapshot

Q.1 Which industry/sub-sector does Infosys Ltd belong to?
Infosys Ltd belongs to the IT & ITES sector, operating specifically within the IT - Software segment.
Q.2 Is Infosys Ltd a good quality company?
Infosys Ltd is a good quality company, based on a consistently good 10 year financial track record.
Q.3 Is Infosys Ltd undervalued or overvalued?
Infosys Ltd appears Undervalued, as its key valuation ratios are below with their past averages.
Q.4 Is Infosys Ltd a good buy now?
Infosys Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Performance Analysis

Q.1 Revenue growth of Infosys Ltd?
Infosys Ltd revenue growth is 6.1% for FY-2025 , which is below its 5 year CAGR of 12.4% , indicating slower growth.
Q.2 Gross Profit margin of Infosys Ltd?
Infosys Ltd Gross profit margin which is the profit after deduction of direct costs, is 26% for FY-2025 , which is below its 5 year median of 26.5% , indicating decreasing margins.
Q.3 Operating Profit Margin of Infosys Ltd?
Infosys Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 24.01% for FY-2025 , which is in line with its 5 year median of 24.01% indicating stable margins.
Q.4 Net Profit Margin of Infosys Ltd?
Infosys Ltd Net Profit Margin is 16.41% for FY-2025 , is below with its 5 year median of 17.08%, indicating decreasing margins.
Current Level Historic Median
Gross Profit Margin 26 26.5
Operating Profit Margin 24.01 24.01
Net Profit Margin 16.41 17.08
Q.5 Return on Asset of Infosys Ltd?
Infosys Ltd Return on Asset is 18.76%, which is below its 5 year historical median of 19.78%, indicating deteriorated asset utilization efficiency.
Q.6 Return on Equity (ROE) of Infosys Ltd?
Infosys Ltd Return on equity is 29.4% for FY-2025 , which is in line with its historical median of 29.4%, indicating the business is making similar use of its shareholders capital.
Q.7 Return on capital employed (ROCE) of Infosys Ltd?
Infosys Ltd Return on capital employed is 41.35% for FY-2025 , which is above its estimated weighted average cost of capital(WACC) 11.25%, indicating value creation.
Q.8 Cash conversion cycle of Infosys Ltd?
Infosys Ltd Cash conversion cycle is 53 days, above its historical median of 50 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level Historic Median
Asset Turnover 1.14 1.14
ROE 29.4 29.4
ROCE 41.35 41.35
Cash Conversion Cycle 53 days 50 days
Q.9 Debt to Equity ratio of Infosys Ltd?
Infosys Ltd Debt-to-Equity ratio is 0.00 , which is lower with the industry average of 0.03 , indicating lower debt levels in the industry.
Q.10 Debt to cash flow from operations of Infosys Ltd?
Infosys Ltd Debt to cash flow from operations is 0 , which is at a healthy level, indicating the business is able to service its debt comfortably.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Infosys Ltd?
Promoters hold 14.52% of the Infosys Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of Infosys Ltd vs industry peers?
Infosys Ltd revenue CAGR is 12.41% , compared to the industry median CAGR of 11.32% , indicating faster growth and gaining its market share.
Profit Metrics
Current Level Industry Median
Revenue 1,62,990 1,17,927.7
Gross Profit 42,377.4 27,851.9
Operating Profit 38,921 25,544
Net Profit 26,750 17,737.5
Operating Efficiency
Current Level Industry Median
Asset Turnover 1.14 1.28
ROE 29.4 26.41
ROCE 41.35 35.53
Cash Conversion Cycle (days) 52.72 44

Valuation & price assessment

Q.1 Stock return of Infosys Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 8.1% based on the current price.
Q.2 What return has the stock given over the last decade?
9Y 5Y 3Y 1Y
Share Price 8.1% -1.8% -2.8% -9.5%
Q.3 Valuation ratios of Infosys Ltd vs historical?
The current P/E is lower that its historical median.
Q.4 How do the current valuation ratios measure up against the historic numbers and the current industry numbers?
Valuation Ratios Current Historic Median Industry Median
Price to Earnings 18.52 23.58 22.96
Price to Book 5.63 5.78 2.61
Price to Sales 2.99 4.34 4.40
EV to EBITDA 10.72 14.86 17.20

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