When it comes to the Indian economy, we have built a very strong business in services, as India is among the highest service exporters to Western countries, which contributes significantly to the nation. Within the service sector, the major contribution has been made by Indian IT companies. Several Indian IT companies have been participating in this for a very long time, and one of them is Infosys.

Looking at future investments, in the era of AI and technology, companies require consistent services, and Infosys, like other major IT companies, provides these services along with next-generation solutions. Other companies such as TCS, Wipro, Tech Mahindra, and Infosys are key players in this sector, with Infosys being India’s second-largest IT company.

So, when we look at Infosys’s future price, there are key factors we need to understand. These include how the company’s business is performing and what we can expect from it in the future. This helps in making the important decision of whether we should invest in this particular stock or not. These factors also determine what the potential target for Infosys could be in 2025.

Business of Infosys

The business of Infosys mainly operates at a global level, but the majority of its revenue comes from the US and Europe. The company provides services and products to several client companies. Nearly 95% of its revenue comes from services, while the remaining 5% comes from product sales.

When we look at the business geographically, the US is one of the most important markets, as nearly 60% of Infosys’s revenue comes from the US, while about 28% comes from Europe. This makes it very important to understand how these two major economies impact Infosys’s performance. That is also why the stock price is currently showing high fluctuations, as it is largely influenced by forecasts about the US business.

We need to note that the company has nearly 3 lakh employees, and around 90% of its business comes from the USA and EUROPE. This makes it very important for India’s service sector because, although these companies hire employees in India, most of the work actually comes from countries like the USA and Europe.

This pattern is common across the entire IT industry, as India has a large pool of highly skilled engineers who are also relatively cost-effective compared to other countries. A major part of the growth for these companies comes from high-technology areas, where they provide services to global clients.

Infosys financial analysis

The company has seen remarkable growth between 2000 and 2020. During this period, the impact of online business was very high, as every company was trying to expand its online presence. This created an opportunity for companies like Infosys to achieve remarkable growth. The company consistently maintained around 20% annual growth until 2020–2022.

However, after that, significant events occurred, such as the Russia-Ukraine war, which led to rising inflation in Western countries. As a result, their spending declined, and because of this, Infosys’s revenue has remained relatively stable at around ₹40,000 crores.

If we look at the financial year 2025, the company’s revenue has increased by only 6%, while the stock price is at a 2-year low. As of yesterday, the stock closed at ₹1,440. This makes the company’s business outlook somewhat unpredictable, as tariffs are currently in place in the USA, and projections indicate that inflation may rise slightly. Because of this, the Federal Reserve is unlikely to cut rates, which will ultimately reduce spending and, in turn, lower business opportunities for the IT sector as well.

If we take a look, the company’s operating margin has been consistently managed. In 2020–21, the company maintained nearly 28% operating profit margin, but as of now it stands at around 24%. This is one of the reasons why the stock is not showing much upward movement.

The company’s net profit has also remained stable, at around ₹4,000 crore. Looking at the balance sheet, the company has strong reserves of more than ₹93,000 crore. Another critical point is that the company has no debt, which strengthens its balance sheet. Additionally, Infosys maintains a dividend pay-out ratio of nearly 50%.

Therefore, when considering investment, this becomes a key factor, as Infosys ensures attractive dividend returns for its investors.

What to expect next in Infosys’s business

It seems that tariffs are going to impact the US economy. Now, the key factor to watch is how inflation shifts, because this will determine interest rate decisions. If interest rates are not cut and inflation continues to rise, then the probability of businesses reducing their spending is high. If such a situation persists, companies are unlikely to increase their expenses, and this will directly impact Infosys’s business.

There is also a factor that the Trump administration is constantly pushing for more manufacturing to take place in the USA. This also brings a potential opportunity for Infosys’s business. However, everything depends on how companies allocate their spending. Key data, such as the growth of domestic manufacturing in the USA, will play an important role. If these developments have a positive impact, then the overall scenario could also turn positive for Infosys.

With AI adoption, companies are focusing on cost-cutting and optimization, and this trend is expected to benefit Infosys’s business.

Infosys share price target

If we take all the data and the current situation into account, we can see that the company’s balance sheet is very strong. Along with that, profit growth for the company is expected to rise. Even though high inflation and high interest rates are affecting businesses globally, Infosys’s revenue has not turned negative. In fact, the company has been increasing revenue by at least 4–5% every year, though margins have been impacted. Financially, Infosys continues to have sustainable income.

At present, the company’s P/E ratio is around 22, which is considered a strong number. One of the most important factors now is the AI boom, which is already making an impact. According to the NETCOM report, Infosys is very well positioned to capture significant business opportunities in AI.

Therefore, there is strong potential for margins and business growth in the future. Additionally, if the ongoing tariff war stabilizes and projections improve over time, it would be very positive for Infosys.

If the tariff situation becomes neutral, we might see a very strong business projection, with the possibility of Infosys reaching new highs in 2025. This could result in a surge of around 25%. However, it is important to closely monitor how the tariff situation affects the economy. For this, we need to keep a close watch on inflation data, monetary policy decisions, and the PMI of the USA, since the majority of Infosys’s business comes from there.