It seems, as government is not ready to accept the truth and keep on blaming global conditions, analysts have also become contended with the rosy pictures framed by government machinery. Certainly analysts have misjudged the magnitude of global pressure inflicted on Infosys. But moreover, I think its Infosys who have failed the tradition; as earlier they have followed the doctrine of "under-promised, over-delivered" but now the case seems completely opposite. Their guidance and earning figures are developing trenches for last one an half year or so.
Well, I think there is a reason behind analysts’ optimist forecasts about Infosys in recent days. When most of the developed nations have been among the doldrums since 2007-08, now it is considered that worse has hit the bottom. Now everyone is hoping for the economies to revive and even average news is considered as the positive sign of the same. And this is where our analysts have seemed to have their prejudices.
One more point comes to the mind and that is related with the theory of probability. When everyone is looking forward to revival of the economy it seems quite obvious that if an analyst makes a positive prediction, he has at least better than average chances of being right. Investors’ memories are exceptionally short, so mistakes are soon forgotten and besides everyone else probably made the same mistake. Massive prediction short falls can always be blamed on exceptional circumstances or the infamous black swans.