Infosys Limited
Fundamental — what it's worthbottom-up fair value
Discounted off Infosys’s free cash flow, cross-checked against owner earnings, peer multiples and normalized earnings power — what is it worth?
Is it cheap or expensive right now?
Latest price vs our fair value. A comparison, not a recommendation.
What it's worth — five lenses
Four independent valuation methods, weighted into one central fair value (a range, not a single point).
| Valuation lens | Per share (INR) | Weight |
|---|---|---|
| DCF (intrinsic FCFF) — primary | 1,143 | 40% |
| Owner earnings / shareholder yield | 1,267 | 15% |
| Relative multiples | 1,284 | 25% |
| Normalized earnings power | 1,368 | 20% |
| Weighted central fair value | 1,242 | +19% vs spot |
The four lenses span a wide range — a deliberately conservative intrinsic DCF marks the floor near ₹1,143, while the owner-earnings (₹1,267), relative-multiple (₹1,284) and normalized-earnings (₹1,368) reads mark the ceiling as a re-rating back toward the multiple Infosys has historically commanded. The GenAI effect on the labour-arbitrage margin is the swing factor. Full detail and the four lenses are in the study and the open model.
Technical & price structuretrend, momentum, key levels
Trend, momentum and key levels — what is the price doing now?
What the chart says
In plain terms: Infosys trades well below our weighted central fair value — a quality compounder de-rated to a value multiple, but in a clear downtrend near its 52-week low. It is a single, focused business: a global IT-services and consulting franchise that is net-cash, converts more than 100% of profit to cash, earns a ~33% return on equity, and returned over ₹37,500 cr to owners in FY26. The market is pricing one real risk — that generative AI compresses the labour-arbitrage pyramid the whole industry is built on. The bull case (~₹1,556) is that Infosys cannibalises its own hours and keeps the margin while the discretionary-demand cycle recovers and the multiple re-rates; the cautious case (~₹995) is AI deflating pricing faster than it cuts cost. What moves it is where the GenAI-affected margin settles, not the balance sheet.
Key levels
Volatility & where the case breaks
| Typical daily moveRoughly how far the price swings in an average day (based on a measure called ATR). Bigger means choppier. | ~2% |
Monte Carlo — where could the price go?near-term price paths
50,000 simulated futures — near-term price paths, independent of the fundamental value.
The 5th–95th and 25th–75th percentile bands from the 50,000-path simulation. Static and pre-computed — independent of the fundamental levers above.
The exact percentiles
The 5th / 25th / middle / 75th / 95th outcomesLine up all 50,000 outcomes low to high — these are the values at the 5%, 25%, 50%, 75% and 95% marks., from 50,000 paths.
| Timeframe | Rare low (5%) | 25% | Middle | 75% | Rare high (95%) |
|---|
What drives the odds
50,000 paths, 16 forces: the US/EU IT-spending cycle, USD/INR, the GenAI pricing effect, the Fed path, India/EM equity flows, wage inflation and deal-TCV momentum — plus event forces: the Q1 FY27 result, a guidance revision, a GenAI pricing shock, a US-recession demand freeze, a mega-deal win, a buyback / special dividend, a visa / immigration shock, a sharp USD/INR move, and index / passive-flow rebalancing. Details in the methodology.
Peer set & risks
Where Infosys sits in its markets
Infosys is one focused business — a global IT-services and consulting franchise — competing against the other India-listed majors and the global consultancies. Peers trade in different currencies and on different multiples, so this is a competitive map, not a price table.
| Arena | Infosys's position | Main rivals |
|---|---|---|
| India-listed IT services | #2 by revenue | TCS · HCLTech · Wipro |
| Global IT / digital services | Top-tier | Accenture · Cognizant · Capgemini |
| Financial-services vertical | ~28% of revenue | TCS · Cognizant · Capgemini |
| Cloud / AI / GenAI services | Scaling (Topaz) | Accenture · TCS · IBM |
| Engineering / ER&D | Growing | Accenture · LTIMindtree · Wipro |
| Mid-cap comparator | Larger, higher-ROE | LTIMindtree · Mphasis · Coforge |
The investment debate turns less on any single arena than on the GenAI effect on the labour-arbitrage margin — whether Infosys cannibalises its own hours and keeps the margin, or is disintermediated. Competitive map, not advice.
About this series & how we build these
Want the full study and the spreadsheet?
Full write-up plus the editable Excel model.
Found a flaw? Attack the model
The full study (PDF) and Excel model are available on a computer.
Edition: 30 Jun 2026. Older editions stay in the Library.