Infosys Q2 Review — Guarded Outlook For FY26 Despite Revenue Beat; ICICI Securities Maintains 'Hold'

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ICICI Securities Report

Infosys Ltd. reported a strong beat on revenue in Q2 FY26 led by healthy broad-based growth in key verticals and markets. However, FY26 revenue growth guidance revision to 2-3% YoY vs 1-3% earlier implies -1.5% to -0.2% CQGR in H2 FY26 vs -0.9% in H2 FY25 i.e., no improvement over last year at mid-point.

Mega deal win (100% net new) announcement of TCV $1.6 billion spread over 15-year provides some growth visibility, although management remains measured in its outlook given the macro uncertainty and elongated decision cycles in certain verticals.

Headcount addition of 8,000 employees marked a change in trend of muted addition in past several quarters, but headcount growth (4.5% YoY) was in line with LTM revenue growth (4.4% YoY CC).

Our EPS estimates remain largely unchanged. Maintain Hold with target price of Rs 1,520, based on 1-year forward unchanged P/E of 21x on Sep’27E EPS of Rs 72.

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