14 January 2019
Equities - India
10 Yrs G-Sec
10 Yrs AAA Corp
Flows (USD b)
Today’s top research idea
Infosys: Catching up with leading peers on growth
INFO’s 3QFY19 constant currency revenue growth accelerated to 10.1% (our
estimate: 9.0%) from 4.6% YoY CC five quarter ago. Investments, however,
continued to take a toll, with the adjusted EBIT margin down 70bp QoQ to
23% (our estimate: 23.5%).
Adj. PAT grew 8% YoY to INR39.9b (1% beat) in 3QFY19. INFO announced (a)
buyback of INR82.6b under the open market route at a maximum price of
INR800/share and (b) special dividend of INR4/share, in line with its
announcement of USD2b payout to shareholders.
As we had highlighted in
report and also in our commentary post
the scarcity of local talent pool at onsite has
been driving companies toward more sub-contractors (among other
initiatives), thereby impacting margins. INFO missed our margin estimate by
40bp in 2Q and again by 50bp in 3Q (margin now down by 110bp YoY.
India Life Insurance
Catching up with leading peers on growth
Margin pressures evident; Rich valuations restricting re-rating
JLR’s wholesale volumes decline in a challenging market
Private players’ individual WRP growth recovers after a brief lull
IIP growth slides to 17-month low off an adverse base
Piping hot news
Finance ministry may sell part of SUUTI holding in Axis Bank, ITC
The Finance Ministry may consider selling part of its stake in Axis Bank and
ITC, held through SUUTI, in next few months, an official said.
Chart of the Day: Infosys – Catching up with leading peers on growth
Revenue growth stood at 2.7% QoQ CC and 2.3% QoQ in USD terms ( Cross Currency impact 50bp)
Research Team (Gautam.Duggad@MotilalOswal.com)
Source: MOSL, Company
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