Infosys Stock (+10%): FY26 Guidance Hike Forces a Re-Rate

Infosys (INFY) reported Q3 results that saw a headline net profit dip due to a one-time provision, but the real catalyst was a significant raise in FY26 revenue guidance. The subsequent +10% move in the ADRs was aggressive and decisive, gapping up on the open. But with underlying client volumes described as soft, is this a genuine demand inflection or a positioning-driven chase for a beaten-down name?

The market correctly ignored the backward-looking, one-time-charge-impacted P&L and focused squarely on the forward guidance, which signals a tangible shift in the demand environment.

• FY26 revenue growth guidance was raised to 3.0%-3.5% in constant currency, up from 2%-3%.
• Backed by strong deal wins of $4.8B TCV, with 57% being net new business.
• Management explicitly cited momentum in AI, with 4,600 active AI projects for top clients.

But here is the interesting part. You are reading about this 10% move after it happened. The market has already priced in the news. To catch the next winner before the headlines, you need predictive signals, not notifications. High Quality Portfolio has flagged 5 new opportunities that haven not surged yet.

Trade Mechanics & Money Flow

Trade Mechanics: What Happened?

The aggression of the move points to a classic institutional repricing event, likely catching many underweight funds offside and forcing a chase.

• Trading volume surged, with India’s NSE seeing ~8.1M shares traded vs. a recent average of ~5.3M.
• Pre-earnings options activity was heavy, suggesting a potential gamma effect as the stock blew past key strikes.
• The gap-up likely triggered a liquidity grab, running stops on short positions and forcing a cover.

How Is The Money Flowing?

This move carries the distinct footprint of ‘Smart Money’ accumulating on a forward-looking catalyst, rather than retail chasing a headline number.

• The focus on guidance over a messy EPS is a hallmark of institutional, not retail, analysis.
• Significant institutional ownership, with mutual funds holding over 22%, provided a stable base.
• ADRs gapped above $19, creating a new potential support zone far from the prior day’s close.

Understanding trade mechanics, money flow, and price behavior can give you an edge. See more.

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What Next?

FOLLOW. The catalyst here is not a fleeting earnings beat but a management-backed signal of a turning demand cycle, supported by a robust deal pipeline. This is a fundamental re-rate. The key ‘Next Level’ to watch is $19.00 on the ADRs. This level represents the low-end of the initial post-earnings surge. If this level holds and becomes a new floor, it confirms that the gap was a breakaway move driven by institutional accumulation and not an exhaustion gap that will be filled. A failure to hold this level would suggest the move was a one-day liquidity event.

That’s for now, but so much more goes into evaluating a stock from long-term investment perspective. We make it easy with our Investment Highlights

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