After 620% dividend in FY22, tech giant is set to pay ₹16.50 per share dividend

Infosys declared interim dividend of 16.50 per equity share as on October 13 for the financial year FY23. The company sets October 28 as the record date for determining eligible shareholders. Dividend benefits. Whereas it plans to pay dividend by 10th November 2022.

It is being said that the shares of Infosys will become ex-dividend on October 27.

The record date is the day the company identifies the names of shareholders eligible for dividend benefits. All shareholders whose names appear in the list of the Company as on the end of the record date shall be eligible to receive the dividend. Meanwhile, the ex-dividend date is the day when the price of a company’s equity shares gets adjusted for dividend payments. This is one business day before the record date.

In FY22, Infosys paid an overall dividend of 620% 31 per equity share. The company is one of the Dividend King stocks.

Also, on Thursday, the company’s board also approved the share buyback plan. 9,300 crore at a floor price of Rs. 1,850 per share.

In Q2FY23, Infosys posted a consolidated net profit of Up 11% from Rs 6,021 crore 5,421 crore in Q2FY22. While consolidated revenue from operations climbed 23.43% to . done 36,538 crore in Q2FY23 29,602 each in the second quarter of the last fiscal.

In addition, the company revised its FY23 revenue guidance to 15%-16%; While the Operating Margin Guidance has also been revised to 21%-22%.

Should you buy Infosys shares?

Pankaj Kapur, Analyst at CLSA, said, “Infosys reported 2Q23 revenue growth slightly below our estimate, but was more than offset with a large margin beat, strong deal wins and an unexpected calibration of FY23 revenue growth and margin guidance. The results, like peers, underscore the flexibility of the services portfolio and the compatibility of the cost structure of Indian IT services companies. We grew our FY23 and FY24 EPS by c.1% each, as well as potential buybacks (by 4Q23). Thus, while the specter of macro risk remains an overhang, we believe a possible break in the downgrade and the proposed buyback could revive investor interest. We maintain our buy rating and our price target of 1,750 1,800 from Rs. Infosys is our preferred sector and a part of CLSA India Focus portfolio.”

Meanwhile, analysts at Emkay Global in their report said, “Infosys has narrowed its revenue growth guidance to 15-16% cc (14-16%), which is 0-1.2% CQGR in H2 with seasonality. Reflects weakness and reflects increased caution amid macro uncertainties. Management has narrowed its EBITM guidance for fiscal 2013 (previously 21-23%) to 21-22% and expects it to be guided by Will be on the low end of the range. We largely maintain our earnings projections (<0.5% change) for FY13. -25 post Q2 performance. We look forward to increasing market share, expected margin recovery and stable liquidity. Looking at production, maintain BUY at 22x Sep-24E EPS with TP of Rs 1,600/share."

Further, analysts at JM Financial in their report said, “We make minor changes in our FY22-25E EPS post 2QFY23 results and maintain BUY with unchanged TP. 1,650. Infosys is on track to retain the growth leadership among Tier I techs despite huge volatility. The 2Q margin improvement reinforces confidence in margin recovery through the remainder of FY23 for the Company/Tier I peers, in line with our thesis.”

Further, analysts at Reliance Securities said, “We expect INFO to continue to gain market share in technology adoption. In view of strong deal wins, strong revenue guidance, healthy margin area and attractive valuations, we are making our BUY recommendation on INFO.” Valuation of the stock at unchanged P/E multiple of 24x FY24E earnings, revised target price of Rs.1,735 (vs. Rs.1,680 prior).”

While analysts at Axis Securities said, “We recommend a BUY rating on the stock and assign a 24x P/E multiple to its FY24E earnings. To arrive at TP of 73.4/share 1,750/share, which represents an increase of 23% over the CMP.”

On the other hand, analysts at ICICI Securities said, “Our EPS estimate for FY23/24 has increased by 1.3%/1.8% mainly due to increase in US Dollar/INR rate sentiment. We note that macro The pain is evident due to the headwinds in the sector and our revenue projections are already baked into a potential bearish scenario. However, we upgrade Infosys to ADD (before: HOLD) as we believe 1) INFY Will benefit from cost-takeout deals, 2) It is likely to deliver industry-leading growth, 3) It has narrowed margins and is likely to improve and 4) Favorable valuation of 21x on FY24E EPS (only 12 % Premium to 10-Year Average 1-Year Forward Earnings Multiple).We value Infy at 23x FY24E EPS to arrive at a TP of Rs 1,564 (earlier: 1,470). We will further take further material deduction in EPS. Don’t guess. Infosys has reduced Nifty by ~17% in last 6 months; suggest adding in dips.

Infosys shares witnessed strong buying on Friday. finished on stock 1,474.05 each rose 3.82% on the BSE. The market cap of the company is approx. 6,20,254.82 crores.

The dividend yield of Infosys at the current market price is around 2.1%.

Disclaimer: The views and recommendations given above are those of individual analysts or broking companies and not of Mint.