Infinite Computer Solutions - Result Update - Emkay

Reco: BUY
CMP: Rs 83
Target Price: Rs 120

Profit beat aided by strong margin improvement

- While Infinite's rev at US$ 53 mn (-6% QoQ) missed est, mgns improved by ~310 bps QoQ to 20% aided by ~11.5% currency depreciation and reduction in employee count

- Pfts at Rs 393 mn (+28% QoQ) beat exp aided by strong mgn show and hedging gains( Rs 64 mn V/s est of ~Rs 40 mn losses). Top 1/5/10 clients declined by ~15%/5%/8% QoQ

- Mgmt indicates revival in business from key telecom client. Co currently pursuing 2 large rev sharing deals. Cash generation continues to improve along thesis

- Raise FY12/13E EPS by 13%/6% aided by Q3 beat and lower currency resets while we cut our US$ revenues. Retain BUY, TP Rs 120 on inexpensive valuations at <3x 1 yr forward P/E.

Source : Equity Bulls

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