Infosys stock hits 6 month low as institutions sell following Q4 results

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Infosys stock hits 6 month low as institutions sell following Q4 results
Infosys: Quotes, News
BSE 984.75BSE Quote18.15 (1.84%)
NSE 984.65NSE Quote18.25 (1.85%)
After jumping as much as four per cent following its results on Tuesday, the stock of Infosys gave up almost all of the gains on Tuesday and has now fallen by almost 3 per cent in trade today.

The stocks has now hit a six month low and was last trading at Rs 3170. The sharp fall in the stock today can be attributed to selling from institutions.

While the Infosys Q4 numbers were in line with expectations, analysts are worried that the company's margins and volumes may take time to recover. The dollar revenue guidance has been way below NASSCOM estimates for the industry.

Also, a hike in Salaries is likely to dent the margins and the company has not hinted at a robust recovery going forward. An exodus of staff, particularly top management has also been a cause for concern at Infosys. Gains in the rupee against the dollar is also contributing to fall in margins.

Brokerage Credit Suisse said, "While growth guidance could be slightly conservative, is far lower than the likely growth of many top peers and actually represents a slight deceleration of the overall 10 percent organic revenue growth in FY14," it reiterates.

State-run insurer Life Insurance Corporation of India (LIC) has already reduced its stake in Infosys to 3.25 per cent in the last quarter from 3.71 per cent. The shares may continue to see some more pressure in the next few trading sessions.

On Tuesday the company reported Q4 numbers that were in line with estimates. Read more on the Q4 numbers here.

GoodReturns.in

Read more about: infosys, q4 2014, stock, nasscom, lic, credit suisse
Story first published: Wednesday, April 16, 2014, 10:49 [IST]
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