Take the pledge to vote

For a better tommorow#AajSawaroApnaKal
  • I agree to receive emails from News18

  • I promise to vote in this year's elections no matter what the odds are.
  • Please check above checkbox.


Thank you for
taking the pledge

Vote responsibly as each vote counts
and makes a diffrence


Issued in public interest by HDFC Life. HDFC Life Insurance Company Limited (Formerly HDFC Standard Life Insurance Company Limited) (“HDFC Life”). CIN: L65110MH2000PLC128245, IRDAI Reg. No. 101 . The name/letters "HDFC" in the name/logo of the company belongs to Housing Development Finance Corporation Limited ("HDFC Limited") and is used by HDFC Life under an agreement entered into with HDFC Limited. ARN EU/04/19/13618
LIVE TV DownloadNews18 App
News18 English
News18 » Business
1-min read

After Whistleblower Blow to Infosys, Here’s What Brokerages Are Saying on the Crisis

Global brokerage firm Jefferies said multiple allegations were particularly related to large deals and the letter alleged that many of them had negligible margins.

Trending Desk

Updated:October 22, 2019, 12:03 PM IST
facebookTwitter Pocket whatsapp
Infosys to open another tech hub in US, hire 1,000 people (File photo of an Infosys office)
File photo of an Infosys office

Infosys Ltd shares posted their biggest single-day drop in the last six years on Tuesday, i.e. 22 October, after a whistleblower complaint alleged “unethical practices” by the company’s top executives to boost profit and revenue. The stock was down 16% at day’s low, erasing more than Rs 42,000 crore from its market cap. Brokerages said the whistleblower complaint against Infosys is expected to keep the stock under pressure for the near term, adding that the allegations could prompt an investigation by the US Securities and Exchange Commission (SEC).

Global brokerage firm Jefferies said multiple allegations were particularly related to large deals and the letter alleged that many of them had negligible margins. According to Jefferies, the issue is likely to remain an overhang on the stock in the near term. “Every 100 bps lower margin impacts FY20/21 EPS (earnings per share) estimates by 4.3%, hence the P/E de-rating could be the bigger risk while the recent re-rating was driven by hopes of sustainable growth outperformance,” it said.

Morgan Stanley said the whistleblower news could put the stock under pressure. “It comes as a setback for the company and could de-rate multiples until clarity emerges,” the brokerage firm said, noting that the stock has been volatile for the last six years due to idiosyncratic issues. Saying that, Morgan Stanley gave an ‘equal-weight’ rating on Infosys shares with a target price at Rs 805 apiece.

Another global brokerage firm Credit Suisse said the nature of allegations makes this a serious matter and, if proven, could lead to the termination of the company’s CEO and CFO.

Domestic brokerage firm Reliance Securities, meanwhile said, that the Infosys matter equates to a corporate governance issue. “Deputy CFO has also quit. This in itself is an indirect admission that something is rotten. Stock will now languish 10-15% lower in the near term. It is also disappointing to see that a company that has long been viewed as a ‘poster boy’ of corporate governance in India has seemingly fallen to such levels,” It said in a note.

Get the best of News18 delivered to your inbox - subscribe to News18 Daybreak. Follow News18.com on Twitter, Instagram, Facebook, Telegram, TikTok and on YouTube, and stay in the know with what's happening in the world around you – in real time.

Read full article
Next Story
Next Story

facebookTwitter Pocket whatsapp
Most Active
Company Price Change %Gain
SBI Life Insura 936.55 -6.35
Bharti Airtel 439.35 7.37
Reliance 1,509.75 3.46
Yes Bank 64.15 -2.58
ICICI Bank 493.50 -0.97
Company Price Change %Gain
SBI Life Insura 936.25 -6.33
Bharti Airtel 439.25 7.36
Yes Bank 64.15 -2.66
Sunteck Realty 389.10 -0.15
Reliance 1,509.80 3.52
Top Gainers
Company Price Change %Gain
Bharti Infratel 250.55 10.47
Bharti Airtel 439.35 7.37
Reliance 1,509.75 3.46
Axis Bank 747.80 3.44
Power Grid Corp 195.45 2.52
Company Price Change %Gain
Bharti Airtel 439.25 7.36
Reliance 1,509.80 3.52
Axis Bank 747.85 3.43
Power Grid Corp 195.30 2.44
SBI 330.30 1.57
Top Losers
Company Price Change %Gain
Zee Entertain 285.85 -2.82
Yes Bank 64.15 -2.58
M&M 560.65 -2.27
TCS 2,108.80 -2.03
Tata Steel 401.75 -2.02
Company Price Change %Gain
Yes Bank 64.15 -2.66
M&M 560.60 -2.19
Tata Steel 401.90 -2.02
TCS 2,108.30 -2.02
Tata Motors 167.75 -1.35

Live TV

Countdown To Elections Results
To Assembly Elections 2018 Results