With a strong quarter, a good year and the forecast of even better times, InfosysBSE -0.87 % Chief Executive Officer Vishal Sikka on Friday signalled the return of a pattern of normalcy at India’s second-largest software services company.
Shares of Infosys were trading 8.79% higher at $20 on the New York Stock Exchange at 10 pm (India time). Indian stock markets were closed on Friday for the Ram Navami holiday.
Sikka, who is regarded as the architect of SAP’s best-selling in-memory database software HANA, has been attempting to reengineer Infosys around the themes of innovation and a focus on the customer. His so-called ‘Renew and New’ strategy, analysts said, appears to be paying dividends. While the pace of growth has picked up, employee attrition levels are down, and the stock markets are showing their faith— Infosys shares have risen by 44% on the NSE since Sikka took over.
Sikka has been advocating what is known as ‘Design Thinking’ which involves a user-centric problem-solving approach, and embracing automation to reduce costs and improve efficiency. He has attempted to balance the twin demands of building revenue momentum while positioning the company to cope with changes brought on by technologies such as cloud computing.
Analysts on average were expecting a revenue guidance of 11-13% in constant currency terms, according to an ET poll. In rupee terms, net profit rose 16.2% to Rs 3,597 crore on revenue of Rs 16,550 crore, which was up 23.4% from last year. Other than financial services and insurance, growth was robust in all verticals, and North America was the only area of softness.
The ‘normal-is-boring’ routine could potentially be disrupted by any of the cofounders who are still classified as promoters of the company, but Sikka said he is not concerned by that. Earlier this month, less than a quarter of the promoter-shareholders voted in favour of resolutions extending Sikka’s term (and increasing his performance-based compensation) and appointing investment professional Punita Kumar Sinha as an independent director. “Ask the promoters about their voting,” Sikka said.
68 total views, 1 views today