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Infosys Ltd.
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  • News
  • Financials
  • Technicals
  • Peers
  • Shareholdings
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Infosys Ltd.

  • 1,274.550.25 (0.02%)
  • Closed
  • As On: 03:45 PM IST
OPEN TRADING A/C
  • Open1,288.45
  • High1,299.75
  • Low1,272.00
  • Prev Close1,274.30
  • Volume87,87,539
  • VWAP(₹)1,283.43
  • Q3 - Digital revenue contribution crosses 50 percent mark

    The third quarter results were better than expected. Digital segment contributed 50.1 percent to total revenues, an increase, both on YoY ( 40.60 percent) and QoQ ( 47.3 percent) basis.
  • Operating profit margin expansion - Halted.

    Q o Q growth in operating profit margin was missing in third quarter. The implementation of the code on social security, 2020, would increase company's contribution to provident fund and gratuity adding to costs.
  • Currency gains

    Given abundant liquidity in the global markets, there is little scope for any strong gains in terms of US dollar. So, the tailwind of currency might be missing for some time to come.
  • New administration in White House

    Will the new US administration continue it harsh policy on H1- B visa or relax it, as expected, is a factor which will impact the company’s near-term fortune. Though in the last few years, the Indian IT sector has learnt to live with the restrictions.

Found Insights useful?

Key Metrics

  • PE Ratio(x)29.19
  • EPS - TTM(₹)43.66
  • MCap(₹ Cr.)5,42,373
  • MCap Rank2
  • PB Ratio(x)8.19
  • Div Yield(%)1.37
  • Face Value(₹)5.00
  • 52W High(₹)1,392.80
  • 52W Low(₹)509.25
  • MCap/Sales2.99
  • Beta(1 Month)0.83
  • BV/Share(₹)154.58

Returns

  • 1 Day0.02%
  • 1 Month-3.81%
  • 3 Months14.24%
  • 1 Year59.64%
  • 3 Years120.58%
  • 5 Years129.59%

Infosys Recommendations

  • Target₹1315
  • OrganizationICICI Direct
  • BUY
  • Target₹1600
  • OrganizationMotilal Oswal Financial Services
  • BUY
  • Target₹1370
  • OrganizationMotilal Oswal Financial Services
  • BUY

Financials

    • Low risk of covid infection

      We have evaluated the impact of COVID-19 resulting from (i) the possibility of constraints to render services which may require revision of estimations of costs to complete the contract because of additional efforts ; (ii) onerous obligations ; (iii) penalties relating to breaches of service-level agreements, and (iv) termination or deferment of contracts by customers. We have concluded that the impact of COVID-19 was not significant based on these estimates for fiscal 2020.

    • Geographic and economy's to watch

      Spending on technology products and services by our clients and prospective clients is subject to fluctuations depending on many factors, including both the economic and regulatory environment in the markets in which they operate. Economic slowdown or other factors may affect the economic health of the United States, the United Kingdom, the European Union (EU), Australia or those industries where our revenues are concentrated.

    • Impressive client addition

      We, along with our subsidiaries, added 376 new clients, including a substantial number of large global corporations. Our total client base at the end of the year stood at 1,411.

  • Dec 2020Sep 2020Jun 2020Mar 2020Dec 2019
    Total Income26,538.0025,140.0024,140.0023,881.0023,919.00
    Total Income Growth (%)5.564.141.08-0.162.86
    Total Expenses19,338.0018,342.0018,300.0018,340.0018,028.00
    Total Expenses Growth (%)5.430.23-0.221.731.76
    EBIT7,200.006,798.005,840.005,541.005,891.00
    EBIT Growth (%)5.9116.405.40-5.946.37
    Profit after Tax (PAT)5,197.004,845.004,233.004,321.004,457.00
    PAT Growth (%)7.2714.46-2.04-3.0510.90
    EBIT Margin (%)27.1327.0424.1923.2024.63
    Net Profit Margin (%)19.5819.2717.5418.0918.63
    Basic EPS (₹)12.2811.4510.0710.1910.51
    Dec 2020Sep 2020Jun 2020Mar 2020Dec 2019
    Total Income22,946.0021,628.0020,803.0020,772.0020,862.00
    Total Income Growth (%)6.093.970.15-0.432.92
    Total Expenses16,020.0015,434.0015,394.0015,613.0015,429.00
    Total Expenses Growth (%)3.800.26-1.401.192.05
    EBIT6,926.006,194.005,409.005,159.005,433.00
    EBIT Growth (%)11.8214.514.85-5.045.47
    Profit after Tax (PAT)5,083.004,497.004,008.004,069.004,076.00
    PAT Growth (%)13.0312.20-1.50-0.176.45
    EBIT Margin (%)30.1828.6426.0024.8426.04
    Net Profit Margin (%)22.1520.7919.2719.5919.54
    Basic EPS (₹)11.9410.569.419.559.57
    FY 2020FY 2019FY 2018FY 2017FY 2016
    Total Revenue93,594.0085,557.0073,715.0071,564.0065,564.00
    Total Revenue Growth (%)9.3916.063.019.1515.53
    Total Expenses71,587.0064,516.0053,374.0051,583.0046,821.00
    Total Expenses Growth (%)10.9620.883.4710.1718.64
    Profit after Tax (PAT)16,594.0015,404.0016,029.0014,353.0013,489.00
    PAT Growth (%)7.73-3.9011.686.419.03
    Operating Profit Margin (%)24.4225.4528.8429.1730.01
    Net Profit Margin (%)18.2718.6322.7220.9521.60
    Basic EPS (₹)38.9735.4471.0762.8059.02
    FY 2020FY 2019FY 2018FY 2017FY 2016
    Total Revenue81,747.0075,959.0065,960.0062,351.0056,989.00
    Total Revenue Growth (%)7.6215.165.799.4112.54
    Total Expenses61,270.0056,032.0046,052.0043,413.0039,389.00
    Total Expenses Growth (%)9.3521.676.0810.2215.00
    Profit after Tax (PAT)15,543.0014,702.0016,155.0013,818.0012,693.00
    PAT Growth (%)5.72-8.9916.918.864.35
    Operating Profit Margin (%)26.0427.2532.1431.9432.60
    Net Profit Margin (%)19.6620.1126.0823.3023.51
    Basic EPS (₹)36.3433.6671.2860.1655.26

    All figures in Rs Cr, unless mentioned otherwise

    Insights
    • Employee & Interest Expense

      Company has spent less than 1% of its operating revenues towards interest expenses and 56.05% towards employee cost in the year ending Mar 31, 2020. (Source: Consolidated Financials)
  • AnnualFY 2020FY 2019FY 2018FY 2017FY 2016
    Total Assets92,768.0084,738.0079,890.0083,355.0075,350.00
    Total Assets Growth (%)9.486.07-4.1610.6213.67
    Total Liabilities26,924.0019,732.0014,966.0014,373.0013,606.00
    Total Liabilities Growth (%)36.4531.854.135.64-12.52
    Total Equity65,844.0065,006.0064,924.0068,982.0061,744.00
    Total Equity Growth (%)1.290.13-5.8811.7221.70
    Current Ratio (x)2.622.843.553.833.91
    Total Debt to Equity (x)0.000.000.000.000.00
    Contingent Liabilities5,009.004,891.00--1,770.00
    AnnualFY 2020FY 2019FY 2018FY 2017FY 2016
    Total Assets81,041.0078,930.0075,877.0079,885.0072,732.00
    Total Assets Growth (%)2.674.02-5.029.8317.66
    Total Liabilities18,807.0016,219.0012,375.0011,868.0011,650.00
    Total Liabilities Growth (%)15.9631.064.271.87-15.24
    Total Equity62,234.0062,711.0063,502.0068,017.0061,082.00
    Total Equity Growth (%)-0.76-1.25-6.6411.3527.07
    Current Ratio (x)2.883.003.784.053.98
    Total Debt to Equity (x)0.000.000.000.000.00
    Contingent Liabilities4,730.004,617.006,068.007,727.001,483.00

    All figures in Rs Cr, unless mentioned otherwise

  • AnnualFY 2020FY 2019FY 2018FY 2017FY 2016
    Net Cash flow from Operating Activities17,003.0014,841.0013,218.0011,531.0010,028.00
    Net Cash used in Investing Activities-239.00-575.004,452.00-14,542.00-901.00
    Net Cash flow from Financing Activities-17,591.00-14,512.00-20,505.00-6,939.00-6,813.00
    Net Cash Flow-919.00-303.00-2,754.00-10,072.002,330.00
    Closing Cash & Cash Equivalent18,649.0019,568.0019,871.0022,625.0032,697.00
    Closing Cash & Cash Equivalent Growth (%)-4.70-1.52-12.17-30.807.67
    Total Debt/ CFO (x)0.000.000.000.000.00
    AnnualFY 2020FY 2019FY 2018FY 2017FY 2016
    Net Cash flow from Operating Activities15,572.0013,989.0012,475.0010,478.009,578.00
    Net Cash used in Investing Activities-116.00-587.005,684.00-13,494.00-1,207.00
    Net Cash flow from Financing Activities-17,391.00-14,571.00-20,536.00-6,968.00-6,908.00
    Net Cash Flow-1,989.00-1,219.00-2,383.00-10,023.001,454.00
    Closing Cash & Cash Equivalent13,562.0015,551.0016,770.0019,153.0029,176.00
    Closing Cash & Cash Equivalent Growth (%)-12.79-7.27-12.44-34.355.24
    Total Debt/ CFO (x)0.000.000.000.000.00

    All figures in Rs Cr, unless mentioned otherwise

    Insights
    • Conservative Profit Recognition

      Over last 5 years, operating cash flow has been continuously rising as compared to company's net profit. (Source: Consolidated Financials)
    • Decrease in Cash from Investing

      Company has used Rs 239.0 cr for investing activities which is an YoY decrease of 58.43%. (Source: Consolidated Financials)
  • AnnualFY 2020FY 2019FY 2018FY 2017FY 2016
    Return on Equity (%)25.3523.7124.6820.8021.84
    Return on Capital Employed (%)30.8331.8330.9228.8130.17
    Return on Assets (%)17.8818.1720.0617.2117.90
    Interest Coverage Ratio (x)130.450.000.000.000.00
    Asset Turnover Ratio (x)97.8697.5688.2782.1582.86
    Price to Earnings (x)16.3920.9215.4116.2920.66
    Price to Book (x)4.154.963.803.394.51
    EV/EBITDA (x)10.1113.1310.229.7312.18
    EBITDA Margin (%)27.6127.8831.4831.6632.35
    AnnualFY 2020FY 2019FY 2018FY 2017FY 2016
    Return on Equity (%)24.9723.4425.4420.3120.78
    Return on Capital Employed (%)31.2831.3831.0027.8028.78
    Return on Assets (%)19.1718.6221.2917.2917.45
    Interest Coverage Ratio (x)180.620.000.000.000.00
    Asset Turnover Ratio (x)97.5392.6281.6374.2174.22
    Price to Earnings (x)17.5422.0315.3416.9822.08
    Price to Book (x)4.385.163.903.454.58
    EV/EBITDA (x)11.4014.3010.8410.6213.38
    EBITDA Margin (%)28.7629.4434.4134.1834.66

Found Financials useful?

Technicals

  • MACD Crossover

    Bearish signal on weekly chart

    Appeared on: 19 Feb 2021

    Region: Positive

    Last Signal 13 Mar 2020 (Loss -20.72%)

    Average price decline of -6.37% within 7 weeks of Bearish signal in last 10 years

    Stochastic Crossover

    Bullish signal on weekly chart

    Appeared on: 19 Feb 2021

    Region: Equlibrium

    Last Signal 20 Nov 2020 (Gain 14.09%)

    Average price gain of 5.42% within 7 weeks of Bullish signal in last 10 years

  • 49%
    Positive Movement
    since 1st Jan 2005
    on basis
    51%
    Negative Movement
    since 1st Jan 2005
    on basis
    Exclude

    Global Meltdown1st Jan 2008 to 10th Nov 2008

    Covid Crisis1st Feb 2020 to 31st Mar 2020

  • R11303.23Pivot

    1291.77

    S11285.53
    R21309.47S21274.07
    R31327.17S31256.37
  • 5 Days14 Days28 Days
    28.7830.1730.48

Found Technicals useful?

Peers

  • NAMEP/E (x)P/B (x)ROE %ROCE %ROA %Rev CAGR [3Yr]OPMNPMBasic EPSCurrent RatioTotal Debt/ Equity (x)Total Debt/ CFO (x)
    Infosys29.208.2525.3530.8317.889.2624.4218.3238.972.620.000.00
    TCS35.8613.2138.4446.0026.749.6527.5020.6786.193.330.000.00
    HCL Tech19.104.9121.5624.4713.3313.4320.4915.6440.751.620.090.35
    Wipro22.784.1717.5721.7611.963.1921.2315.9716.672.400.110.58
    Tech Mahindra22.343.9618.4819.8810.798.2714.2510.5846.212.120.110.56
    Add More
    Annual Ratios (%)

    Choose from Peers

      Choose from Stocks

        • CHART
        • TABLE
        • 1D
        • 1W
        • 1M
        • 3M
        • 6M
        • 1Y
        • 5Y
      Insights
      • Stock Returns vs Nifty 100

        Stock gave a 3 year return of 120.53% as compared to Nifty 100 which gave a return of 36.33%. (as of last trading session)
      • Stock Returns vs Nifty IT

        Stock generated 120.53% return as compared to Nifty IT which gave investors 92.42% return over 3 year time period. (as of last trading session)

      Found Peer Comparison useful?

      Shareholding Patterns

      • CategoryNo. of SharesPercentage% Change QoQ
        Promoters55,16,82,33812.95 %0.00
        Pledge00.00 %0.00
        FII1,37,42,72,52232.26 %0.95
        DII1,01,15,00,01423.75 %-1.21
        MF58,21,05,10713.67 %-0.56
        Others1,32,21,32,95931.04 %0.26
      • Category31 Dec 202030 Sep 202030 Jun 202031 Mar 2020
        Promoters12.9512.9513.1513.15
        Pledge0.000.000.000.00
        FII32.2631.3130.4731.01
        DII23.7524.9625.4224.68
        Mutual Funds13.6714.2313.8313.66
        Others31.0430.7830.9631.16

      Mutual Funds Ownership

      MF Ownership as on 31 January 2021

      • Equity: Large Cap
        • 6,906.33

          Amount Invested (in Cr.)

        • 7.81%

          % of AUM

        • 1.40

          % Change (MoM basis)

      • Equity: Large Cap
        • 3,517.95

          Amount Invested (in Cr.)

        • 8.97%

          % of AUM

        • 3.37

          % Change (MoM basis)

      • Equity: Flexi Cap
        4
        • 2,267.46

          Amount Invested (in Cr.)

        • 6.99%

          % of AUM

        • -1.08

          % Change (MoM basis)

      Futures & Options

        • Type
        • Expiry Month
        • Strike Price
        DatePrice

        27-09-2020Current

        0.00-401.25 (-100.00%)

        0.00
        Open
        0.00
        High
        0.00
        Low
        401.25
        Close
        0
        Contracts Traded
        0.00
        Turnover (₹ Lakhs)
        • Expiry Month
        DatePrice

        27-09-2020Current

        1,289.7013.55 (1.06%)

        1,281.90
        Open
        1,301.00
        High
        1,281.05
        Low
        1,276.15
        Prev Close
        4,510
        Contracts Traded
        69,950.82
        Turnover (₹ Lakhs)

      Corporate Actions

      • Board Meeting

        Quarterly Results

        Dec 16, 2020

        Interim Dividend

        240%

        Oct 14, 2020

        Board Meeting

        Quarterly Results & Interim Dividend

        Sep 15, 2020

      • Announced onMeeting on
        Dec 16, 2020Jan 13, 2021
        Quarterly Results
        Sep 15, 2020Oct 14, 2020
        Quarterly Results & Interim Dividend
        Jul 08, 2020Jul 15, 2020
        Quarterly Results
        Apr 15, 2020Apr 20, 2020
        Audited Results & Final Dividend
        Dec 30, 2019Jan 10, 2020
        Quarterly Results
      • Announced onEx-DateDividend%
        Oct 14, 2020Oct 23, 2020240%
        Apr 20, 2020May 29, 2020190%
        Oct 11, 2019Oct 23, 2019160%
        Apr 12, 2019Jun 13, 2019210%
        Jan 11, 2019Jan 24, 201980%
      • Announced onEx-Date
        Jul 13, 2018Sep 04, 2018
        Bonus Ratio: 1 share(s) for every 1 shares held
        Apr 24, 2015Jun 15, 2015
        Bonus Ratio: 1 share(s) for every 1 shares held
        Oct 10, 2014Dec 02, 2014
        Bonus Ratio: 1 share(s) for every 1 shares held
        Apr 14, 2006Jul 13, 2006
        Bonus Ratio: 1 share(s) for every 1 shares held
        Apr 13, 2004Jul 01, 2004
        Bonus Ratio: 3 share(s) for every 1 shares held
      • Announced onEx-Date
        Nov 30, 1999Jan 24, 2000
        Split: Old FV10.0| New FV:5.0
      • No Data Available

      • Announced onMeeting on
        May 15, 2020Jun 27, 2020
        -
        Apr 12, 2019Jun 22, 2019
        Book closure from Jun 15, 2019 to Jun 15, 2019
        Jul 18, 2018Aug 25, 2018
        -
        Apr 13, 2018Jun 23, 2018
        Book closure from Jun 16, 2018 to Jun 16, 2018
        Jan 04, 2018Feb 24, 2018
        -

      About

      Infosys Ltd., incorporated in the year 1981, is a Large Cap company (having a market cap of Rs 542,927.07 Crore) operating in IT Software sector.

      Infosys Ltd. key Products/Revenue Segments include Software Development Charges and Software Products for the year ending 31-Mar-2020.

      For the quarter ended 31-12-2020, the company has reported a Consolidated Total Income of Rs 26,538.00 Crore, up 5.56 % from last quarter Total Income of Rs 25,140.00 Crore and up 10.95 % from last year same quarter Total Income of Rs 23,919.00 Crore. Company has reported net profit after tax of Rs 5,215.00 Crore in latest quarter.

      The company’s top management includes Mr.Nandan M Nilekani, Mr.Salil Parekh, Mr.U B Pravin Rao, Dr.Punita Kumar Sinha, Mr.D Sundaram, Ms.Kiran Mazumdar Shaw, Mr.Michael Gibbs, Mr.Uri Levine. Company has Deloitte Haskins & Sells LLP as its auditors. As on 31-12-2020, the company has a total of 425.96 Crore shares outstanding.

      About Infosys

      Infosys Ltd., incorporated in the year 1981, is a Large Cap company (having a market cap of Rs 542,927.07 Crore) operating in IT Software sector. Show More

      Key Indices Listed On

      Nifty 50, S&P BSE Sensex, Nifty IT, Nifty 100, Nifty 200

      Address

      No. 44, Hosur Road,Electronics City,Bengaluru, Karnataka - 560100

      Executive Leadership

      AG

      A G S Manikantha

      Co. Secretary & Compl. Officer
      DS

      D Sundaram

      Independent Director
      IS

      Inderpreet Sawhney

      Chief Compliance Officer
      JS

      Jayesh Sanghrajka

      Deputy Chief Financial Officer
      Show More

      Auditors

      Deloitte Haskins & Sells LLP

      Infosys Share Price Update

      Infosys Ltd. share price moved up by 0.02% from its previous close of Rs 1,274.30. Infosys Ltd. stock last traded price is 1,274.55

      Share PriceValue
      Today/Current/Last1,274.55
      Previous Day1,274.30

      DATA SOURCES: TickerPlant (for live BSE/NSE quotes service) and Dion Global Solutions Ltd. (for corporate data, historical price & volume, F&O data). Sensex & BSE Quotes and Nifty & NSE Quotes are real-time and licensed from BSE and NSE respectively. All timestamps are reflected in IST (Indian Standard Time).

      DISCLAIMER: Any and all content on this website including tools/analysis is provided to you only for convenience and on an “as-is, as- available” basis without representation and warranties of any kind. The content and any output of such tools/analysis is for informational purposes only and should not be relied upon or construed as an investment advice or guarantee for any specific performance/returns advice or considered as recommendation for the purchase or sale of any security or investment. You are advised to exercise caution, discretion and independent judgment with regards to the same and seek advice from professionals and certified experts before taking any decisions.

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      Markets Data

      *

      Key Metrics

      • This is a ratio arrived at by dividing the current market price of a stock by its latest (annual or annualized) earnings per share. Here we have taken the TTM (trailing twelve months) adjusted earnings per share.

      • Earnings per share (TTM) tells the profit after tax earned on a per share basis by a stock over the last twelve months or four quarters.

      • MCap or Market capitalization of a stock is calculated by multiplying the total number of shares outstanding of that particular stock with its current market price.

      • This is the ranking of a company within its sector based on MCap or Market capitalization. Higher the market capitalization of a company, higher the rank it is assigned.

      • Price to Book represents the ratio of current market price of a stock to its book value per share. The book value itself is arrived at by dividing the net worth of a company by the total number of shares outstanding of the company at that time.

      • Dividend Yield calculates the amount of full year dividend declared by a company as a percentage of the current market price of a stock. All other things being equal, higher the dividend yield of the stock, the better it is for investors.

      • Face value of a stock is the value ascribed to the stock as per the balance sheet of the company. The dividend declared by a company is usually declared as a percentage of face value.

      • Beta (β) is a measure of systematic risk. It describes the responsiveness of a stock to fluctuations in the market. Beta coefficient of more than 1 denotes that a security is more volatile than its benchmark and less than 0 signifies that security return is not correlated to market movement.

      • Volume Weighted Average Price represents the average price of a security over a particular time period (example one trading day) weighted by the volume traded at each price point.

      • This represents the 52 week high and low price of the security. It is also the 1 year high and low of the security. This represents the highest and lowest price touched by the security during the past 52 weeks or 1 year including today.

      • Book value represents the value arrived at by subtracting the total liabilities from the total assets of the company. On dividing this value with the total number of shares outstanding for the company, we can arrive at book value per share. Book value is also known as Net Asset Value of a company.

      • This is a ratio of market capitalisation of a company’s stock to its annual sales. The market capitalization here is taken for the fully paid-up equity share of the company.

      Technicals

      • Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged. It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.

        Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged. It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.

      • Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged. It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.

        Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged. It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.

      • Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged. It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.

        Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged. It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.

      • Pivot points are indicative support and resistance levels which are calculated on basis of previous day’s high, low and closing prices. Pivot level for Monday’s trade would be based on Friday’s prices and Monday’s, high, low and close price would go into calculation of pivot levels for Tuesday’s trading session.

        There are two underlying assumptions in pivot points. First, the specific price level indicated by R1, R2 and R3 may act as a barrier or resistance in an uptrend. So, if a stock moves up above these pivots levels, the uptrend gets confirmed. Second these specific price levels may see an increased activity, hence may be used as levels to book profit by traders with a long positions. For traders with short position, these points are often helpful in determining what should be the stop loss for a trade.

        Similarly, in case of support levels as indicated by S1, S2 and S3, they may act as price level where a stock might get a breather when it is slipping southward. In case these supports levels are broken it is a confirmation of a down trend. The stock may also see increased activity close to pivot levels. They may be used by trader may use them to put stop loss for a long trade. If a trader has short position, the pivot level may help in determine a level, where profit may be booked.

        Like any other technical indicator, pivots levels cannot and should not be used as single factor while taking a trading decision. They should be combined with other technical indicators. It could be short term moving averages, stochastic, moving average convergence divergence (MACD) or overbought level as indicated by relative strength index (RSI). For example, if a breakdown of support level (S1, S2 or S3) is accompanied with stock price also moving below its short term moving average or stochastic on daily charts giving a sell signal, it would add to weightage to the decision of taking a short trade.