Infosys Q3 results: Why Infosys share price may open lower after Infosys ADR price crash on NYSE

Infosys share price is uncertain to be launched with a gap to the lower side when the New York Stock Exchange opens for trading on Friday as indicated by the American Depositary Receipt (ADR) of the IT giant Infosys. Infosys ADR smashed 5.77% to finish the trading session at $21.57 on January 16, after Infosys Q3 results release.

The loss observed in Infosys ADR price NYSE gives a hint of the fact that most probably opening the shares of Infosys will be on a weak note when the market in India is open for Friday's trade. American Depositary Receipts (ADR) are a vehicle for international companies to be traded on US stock markets, in the same way, regular Infosys share are.

Furthermore, in the essence, an Infosys ADR on NYSE is comparable to a particular certificate given by a U.S. bank. Infosys, India’s second-biggest software services provider, showed a 4.6% increase in net income reaching ₹6,806 crore at the end of December 2024 from ₹6,506 crore during the previous quarter. The IT major’s revenue in Q3FY25 grew 2% to ₹41,764 crore from ₹40,986 crore, qoq. USD EBITDA of $4,939 million was derived while USD constant currency terms revenue growth was 1.7% qoq.

EBIT went up 3% qoq to ₹8,912 crore, while EBIT margin went up by 20 bps qoq to 21.3%. Infosys skyrocketed its CC revenue growth forecast for FY25 to 4.5% -5% of yoy comparing to prior guidance of 3.75% - 4.5%. Operating margin guidance for FY25 at 20%-22% was the same. As per Dipeshkumar Mehta, Senior Research Analyst at Emkay Global Financial Services, Infosys stock reported outstripping revenue growth in Q3.

"Customer demand is stable in other industries, expanding under the influence of cost optimization. Infosys has increased revenue growth guidance for FY25 for the 3rd time in a row to 4.5-5% (3.75-4.5% earlier). Nonetheless, this means a 2.5% to 0.6% quarter-on-quarter decline in Q4, which is a downside mainly due to seasonality of pass-through revenue and fewer working days. The changes we make to FY25-27E EPS are less than 1%, considering Q3 performance," stated Mehta.