Fairval

Notes on Indian equities, sectors and economy

Changing equation in Indian IT

Posted by fairval on April 27, 2013

The following 2 graphs show the changing equations in India IT. Infy’s EBITDA margins have slid steadily in recent years. In FY13, TCS matched Infy in EBITDA margins.

EBITDA margins for top 4 Indian IT Cos

 

The more noteworthy point is the dramatic slide in Infy PE. At 12.5x expected FY14 eps, Infy now has a large discount over TCS (while hcl tech looks similar, it is FY13e, so on FY14 basis there should still be some discount to Infy).

Forward PE

 

 

 

 

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