Infosys falls as UBS downgrades stock to “Sell”

Stocks

oi-Sunil

By Sunil Fernandes

Published: Wednesday, May 7, 2014, 11:11 [IST]

Foreign brokerage firm, UBS has downgraded the Infosys stock to "sell" from "buy" and cut its target price to Rs 2,750 from Rs 4,050, a Reuters report has stated.

UBS has said that it expects the next wave of growth for the sector to be led by infrastructure services and business process outsourcing, which account for less of Infosys' revenue than competitors such as Tata Consultancy Services Ltd or HCL Technologies Ltd.

The stock of Infosys was down almost one per cent in trade at Rs 3137. Infosys has seen a sharp fall in its share price, ever since the CEO warned of a muted performance for Q4 2014 and the company's own guidance failed to enthuse investors.

The stock had hit a high of Rs 3848, only two months ago on march 6, 2014. However, the stock has now dropped almost 15 per cent since than.

Large and retail investors have sold into the stock, on worries over growth prospects, as also sharp gains in the Indian rupee against the dollar.

The company's growth is still way below growth estimates of NASSCOM for the Industry. The stock was one of the better performing Sensex stocks in 2013.

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