Infosys investor day 2026: AI push sparks hopes of stock turnaround

Nandan Nilekani said that AI capability might race ahead of enterprise needs, creating both risks and opportunities for those who can execute effectively

Infosys Ltd. drew bullish commentary from analysts after its 'Investor AI Day' on Tuesday, where the chairman highlighted artificial intelligence (AI) as one of the company's biggest growth opportunities.  

Brokerages signalled that the current financial year could mark the bottom of the growth cycle. This comes after the Infosys stock tumbled 14 per cent so far this year, with the market capitalisation sliding about ₹1 trillion.  

The correction has been driven by mounting investor concerns about the potential impact of AI on the sector’s growth outlook, with the launch of a new AI tool by startup Anthropic further clouding sentiment.  

Nandan Nilekani, chairman of Infosys, said that the AI "opportunity is bigger than ever before. So don’t be distracted by that." Nilekani noted that AI capability might race ahead of enterprise needs, creating both risks and opportunities for those who can execute effectively. DETAILED STORY HERE

Here's how brokerages have interpreted Infosys Investor AI Day:

Motilal Oswal

Analysts said CY26 is likely to mark the bottom of the current growth cycle for the IT sector, paving the way for a more meaningful acceleration in the second half of FY27 and in FY28 as AI services move into scaled deployment.  

They noted that there is limited evidence of further earnings cuts and believe a cyclical recovery in core businesses is already underway. However, concerns around terminal value and the disruptive impact of AI could restrict any near-term re-rating of valuations. 

According to analysts, the rise of AI-native enterprise applications is expected to rely on legacy service vendors' deep client relationships and execution capabilities to scale effectively, supporting a gradual recovery in the sector. 

Nirmal Bang

Analysts said sustained large deal wins, with nine-month deal bookings already exceeding the full FY25 total, along with AI-first transformation tailwinds and disciplined capital allocation, have improved long-term earnings visibility for Infosys. This stronger outlook has also prompted the company to raise its FY26 guidance for the third time this year. 

They added that consistent revenue growth over the past three quarters, coupled with improving visibility for FY27 and early signs of discretionary spending recovery in the banking, financial services and insurance (BFSI) and energy, utilities and resources verticals, underpin their constructive stance.   ALSO READ | Affordable Housing Finance a compelling long-term story, says Centrum

Antique Stock Broking

Management remains confident of stronger growth in FY27 compared with FY26, with the banking and manufacturing segments expected to drive the expansion. The company sees incremental opportunities ahead, with no signs of pricing deflation, and overall commentary from the leadership remained positive. 

Analysts added that while Infosys and other domestic information technology players have historically lagged global peers such as Accenture in AI investments and positioning, effective execution of their AI strategy could help narrow the gap over time.

Centrum Broking

Analysts said AI-led services are already scaling meaningfully at Infosys, with increasing enterprise-wide deployments across large global clients. These initiatives are being supported by platforms such as Topaz Fabric and an increasingly AI-enabled workforce. 

Management reiterated that strong client relationships, a comprehensive suite of AI offerings and a focused go-to-market strategy targeting large enterprises position the company to capture a disproportionate share of the structural AI opportunity. 

Accordingly, analysts expect revenue, Ebitda and profit after tax to grow at a compound annual growth rate of 9.2 per cent, 10.3 per cent and 10.2 per cent, respectively, over FY25 to FY28 estimates. 

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(Disclaimer: The views and investment tips expressed by the analysts in this article are their own and not those of the website or its management. Business Standard advises users to check with certified experts before taking any investment decisions.)