Infosys share price jumps over 5% after Q3 results. Should you buy?

Infosys share price jumped over 5% in early trade on Friday after the IT services major reported its Q3 results. Infosys shares rallied as much as 5.20% to ₹1,682.25 apiece on the BSE.

The gains in Infosys shares came after the second largest IT services exporter in India, reported a steady quarter amid a cautious demand environment, supported by strong deal activity. The company also raised its revenue growth guidance, reflecting confidence in the demand environment.

The IT company’s net profit fell 9.6% to ₹6,654 crore in the third quarter of FY26 from ₹7,364 crore in the previous quarter. The company’s revenue rose 2.2% to ₹45,479 crore from ₹44,490 crore, quarter-on-quarter (QoQ).

Revenue in dollar terms increased 0.5% to $5,099 million from $5,076 million. In constant currency terms, Infosys posted revenue growth of 0.6% sequentially, and 1.7% year-on-year (YoY).

EBIT in Q3FY26 rose 1.3% to ₹9,479 crore from ₹9,353 crore, while EBIT margin weakened by 20 basis points (bps) to 20.8% from 21%, QoQ.

Infosys raised its FY26 revenue growth guidance to 3.0% - 3.5% in constant currency terms from 2% - 3%, and reiterated its operating margin outlook of 20% - 22% for FY26.

Should you buy Infosys shares?

Infosys reported a marginal beat on revenue and a tad miss on margins. According to ICICI Securities, Infosys’ FY27 revenue growth will likely outpace that of FY26 due to strong order book momentum and uptick in AI-led discretionary demand across industries led by financial services, energy, resources and utilities.

The brokerage firm models 4.7% and 5.7% YoY CC growth for FY27E and FY28E as against earlier expectations of 3.8% and 6.1% growth. It noted that hiring has inched up in line with growth visibility, with total headcount growing 4.2% YoY, ahead of TTM revenue growth of 3.3% YoY CC – a marked change from headcount lagging revenue growth for the past several quarters.

ICICI Securities maintained a ‘Hold’ rating for Infosys shares with a target price of ₹1,630 apiece, based on a one-year forward unchanged P/E of 21x on Dec’27E EPS of ₹78.

Infosys deal wins were strong at $4.8 billion, up 92% YoY, even excluding the NHS deal, deal wins rose 28% YoY to $3.2 billion.

JM Financial now builds 3.5% CC growth for FY26E at top end of the guidance. The optimism is driven by headcount addition, NHS deal and uptick in discretionary deals. The brokerage firm raised its growth estimate for FY27E by 100 bps on positive management commentary. It upgraded EPS (Adj.) estimates by 1.5%-2.8% over FY26-28E.

The brokerage firm continues to value the stock at 23.4x and raised Infosys share price target to ₹1,930 apiece, while maintaining a ‘Buy’ call.

Infosys share price has gained 5% in one month and has risen 14% in three months. The largecap IT stock has fallen 13% in one year, but has surged 24% in five years.

At 9:35 AM, Infosys share price was trading 4.70% higher at ₹1,674.20 apiece on the BSE.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.