Morgan Stanley has reiterated an overweight rating on Infosys, with a target price of ₹1,700 per share, reflecting continued confidence in the company’s superior earnings momentum relative to peers. The brokerage notes that the Q1FY26 results from Infosys strike a more balanced note compared to larger rivals, highlighting a blend of growth resilience, margin discipline, and execution agility. Infosys’s revenue growth for the quarter—up 8% year-on-year—and EBIT margin performance at 20.8% comfortably place it ahead of industry standards, reinforcing the company’s status as a bellwether for the sector
MS points to several distinguishing factors in Infosys’s results: first, the company’s revenue mix and large-deal momentum set a visible runway for growth in the coming quarters. Infosys raised its FY26 revenue growth guidance to 1–3% in constant currency, after clocking impressive deal wins worth $3.8 billion, more than half of which were net new. This strong pipeline should enable Infosys to push growth trends toward the higher end of the guided range for the fiscal year.
Additionally, the brokerage emphasizes Infosys’s ability to deliver the strongest EBIT (Earnings Before Interest and Tax) growth within the Indian largecap IT coverage universe for FY26. The margin outlook remains robust, supported by ongoing operational improvement initiatives under Project Maximus and prudent cost discipline, which should insulate the company from industry-wide cost inflation and wage pressures.
Morgan Stanley’s endorsement stems not only from the headline numbers but also from Infosys’s steady performance across verticals—manufacturing, energy, and financial services saw solid sequential gains—while its focus on next-generation technology and enterprise AI adoption is likely to keep Infosys ahead of the digital transformation curve. The brokerage sees sustained upward potential in earnings and free cash flow, underpinned by healthy execution and a comprehensive service offering for global clients. For investors seeking stability amid sector volatility, Infosys stands out as an all-weather performer, poised for above-industry growth through FY26.
