Infosys Limited

Technology — Information Technology Services · NSE

₹1,161.20+₹51.20 (+4.61%)

DalalBaazaar Score

68 / 100

🟢 Good

Verdict

REASONABLE

Risk

Moderate

Driven by high debt relative to equity.

In simple words: Strong business and financial position, with modest growth. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:01 pm

Understanding the Business

Company site ↗

The 60-second version of Infosys Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Infosys Limited provides consulting, technology, outsourcing, and digital services worldwide.

IndustryInformation Technology Services

SectorTechnology

Employees3,28,062

Annual revenue₹2,016 Cr

How does it make money?

Turns over ₹2,016 Cr a year. Of every ₹100 of sales, about ₹16 reaches shareholders as profit, with ₹25 left at the operating level before interest, tax and depreciation. Each of its 3,28,062 employees supports ₹61,446 of revenue a year, the signature of a people-led business.

Revenue / employee₹61,446

Who are its competitors?

The closest listed comparisons in its industry are TATA CONSULTANCY SERV LT, HCL TECHNOLOGIES LTD, WIPRO LTD, TECH MAHINDRA LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?The numbers suggest a real one

ROCE has stayed above 15% in every year available and stands at 41.7%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 32.0% against a peer median of 24.6% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

Peer median ROE24.6%

What is the outlook?

40 analysts covering the stock expect revenue to grow about 3.6% and earnings to grow about 4.4% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+3.6%

Est. earnings growth+4.4%

Analysts40

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +11% while net margin moved +0% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+11%

Margin effect+0%

DalalBaazaar Score

68/ 100

Good

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 3.4% — barely ahead of inflation
✗ Profit CAGR of only 3.6%

Quality vs. Valuation

Company Quality

68/ 100

Good

How good the business is, ignoring the share price entirely.

Valuation

53/ 100

Fair

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

15.8x

3Y Median

2049.5x

40 monthly readings · mean 1997.1x · range 1242.6x–2631.3x

Sector Median

18.8x

median of 4 sector peers

🟢Current valuation is approximately 99% below its 3y median of 2049.5x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟢Against its sector it trades 16% below the peer median of 18.8x.

vs. its own history

Cheap

2049.5x median over 40 months · -99%

vs. sector peers

Fair

18.8x median of 4 peers · -16%

vs. generic bands

Fair

15x–35x

EV/EBITDA

938.7x

PEG

4.42

What's Good / What's Bad

🟢 What's Going Well4

Cash generation is improving
Free cash flow is up 47% over 3 years.
Return on capital is rising
ROCE has improved from 39.5% to 41.7%.
High return on capital employed
ROCE of 41.7% is the mark of a business that converts capital into profit efficiently.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

1 item require attention · 1 high

🔴High leverageFinancial
Debt/Equity of 9.54x — earnings must service borrowings before shareholders see anything.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 41.7% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Priced below its own history
The stock trades 99% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Leverage amplifies any setback
Debt/Equity of 9.54x. Interest is payable whether or not the business has a good year.
Growth barely outpaces inflation
Revenue compounding at 3.4% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 23%✓ 24.8%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Revenue growth stays above 4% a year✗ 3.4% CAGR
Latest reported year was 2.9%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
3Free cash flow remains positive✓ ₹373 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.2x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 39%✓ 41.7%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

10 / 12 checks passed

✓ Strong return on equity (ROE ≥ 15%)
✓ Strong return on capital employed (ROCE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✗ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

6 good · 3 neutral · 2 weak

Market Cap

₹4.70 L Cr

Large Cap

Large, widely-covered business — typically the steadiest of the bands

P/E (Trailing)

15.8x

Fair

Fairly valued against the generic band

P/B Ratio

5.15x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹73.4

Profitable

Profitable on a per-share basis

ROE

32.0%

Strong

Strong capital efficiency

ROCE

41.7%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

9.54x

High

High leverage

Revenue Growth (YoY)

2.9%

Modest

Modest growth

Profit Growth (YoY)

5.3%

Modest

Slow profit growth

Dividend Yield

4.31%

Healthy

Meaningful cash return while you hold the stock

Free Cash Flow

₹317 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

14.5x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

ROA

15.3%

Good

Assets are working hard

Operating Margin

21.2%

Good

Healthy core-business profitability

Net Margin

16.4%

Good

Strong bottom-line conversion

Current Ratio

1.86

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.12

Defensive

Steadier than the market

52W Range Position

24%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

1034.5 / 1087.3

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

77.2

Overbought zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹1,821 Cr	₹1,856 Cr	₹1,928 Cr	₹2,016 Cr	+3.4%
EBITDA	₹462 Cr	₹493 Cr	₹501 Cr	₹501 Cr	+2.8%
EBITDA Margin	25.3%	26.5%	26.0%	24.8%	—
PAT (Net Profit)	₹298 Cr	₹317 Cr	₹316 Cr	₹331 Cr	+3.6%
EPS	₹0.71	₹0.76	₹0.76	₹0.8	+4.1%
ROE	32.5%	30.0%	28.2%	33.9%	—
ROCE	39.5%	37.1%	36.2%	41.7%	—
Total Debt	₹101 Cr	₹100 Cr	₹96 Cr	₹97 Cr	-1.4%
Free Cash Flow	₹253 Cr	₹288 Cr	₹409 Cr	₹373 Cr	+13.8%

🟢 Revenue has grown at 3.4% a year over 3 years.

🟢 EBITDA has grown at 2.8% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 24.8% over 3 years.

🟢 PAT (Net Profit) has grown at 3.6% a year over 3 years.

🟢 EPS has grown at 4.1% a year over 3 years.

🟢 ROE has risen from 32.5% to 33.9% over 3 years (+1.4 pts).

🟢 ROCE has risen from 39.5% to 41.7% over 3 years (+2.2 pts).

🟡 Total Debt has been broadly flat over 3 years (-1.4% a year).

🟢 Free Cash Flow has grown at 13.8% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1,645 Cr

Total Liabilities

₹661 Cr

Cash & Equivalents

₹234 Cr

Operating Cash Flow

₹404 Cr

Capex

-₹31 Cr

Shareholding (proxy)

Institutional Holding

51.2%

Insider Holding

16.0%

Corporate Actions

Next Earnings

23 Oct 2026

Dividend Rate

₹50

Ex-Dividend Date

10 Jun 2026

Analyst Consensus

Recommendations

23 Buy · 16 Hold · 3 Sell

Target Price (Mean)

₹1,179.98

+1.6% vs CMP

Target Range

₹940 – ₹1,610

Peer Comparison

Company	P/E	ROE
TATA CONSULTANCY SERV LT	17.3x	45.6%
HCL TECHNOLOGIES LTD	20.4x	24.6%
WIPRO LTD	14.5x	15.9%
TECH MAHINDRA LIMITED	28.8x	19.2%

Recent News

1 positive4 mixed1 general

TCS, HCL, Wipro, Infosys Bleeding: Why Are IT Stocks Down? Check Q1 Result Dates, Preview, Dividend Rewards

Goodreturns, 18 OctCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

TCS, TechM, Infosys shares lead Sensex, Nifty gainers on reverse AI trade; here's why

Business Today, 15 OctPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

IT shares fall for sixth straight session; OFSS, Infosys top losers: Here's why

Moneycontrol.com, 25 SeptPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

IT shares trade mixed post Accenture earnings; HCL Tech, Infy down up to 4%

Business Standard, 05 OctResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Infosys Stock Crash: IT Giant Hits 6-Year Low As Investor Confidence Takes A Hit

Dalal Street Investment Journal, 24 Sept

Infosys shares fall 5% in 5 sessions; should you buy, sell or hold?

Moneycontrol.com, 22 SeptPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
RSI is in overbought territory — momentum entries here carry more short-term pullback risk.

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Profitability · Risk

MiddlingValuation

WeakGrowth

Points for each in the Score ↑

Good business at a fair price

A sound business at a reasonable valuation. Suitable for a long-term holding, with the valuation and the direction of margins worth watching rather than the business itself. 1 high-severity red flag sits above this conclusion and should be read first.

1 of 5 tripwires tripped — Revenue growth stays above 4% a year · see Key things to watch ↑