Prabhudas Lilladher says Infosys valuations attractive, recommends 'buy'

MUMBAI: A 'buy' report by brokerage firm, Prabhudas Lilladher, recommends the Infosys stock to investors, citing attractive valuations and sustainable growth as key reasons. Infosys' current multiples, which are at 12.1x FY14 earnings estimates, is one of the lowest valuations that the company has witnessed since the Lehman crisis, according to the report.

""We are still not able to envisage a scenario similar to that. Moreover, the delay in project ramp-up will only create projects along the sidelines, which would start once there is more clarity on macro-uncertainty. We reiterate "BUY" with a target price of Rs2,940," the report said.

The report points out that Infosys added highest number of clients among its peers in the last four quarters but was not captured in its quarterly performance. "We expect ramp-up of projects from the client win to result in a positive surprise," the report said, adding that the knee-jerk reaction to Q4FY12 results pushed the Infosys stock to trough valuations.

""We believe that the current market price is factoring in most of the negative sentiments,"" the analysts who authored the report said.