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Infosys CEO S
Infosys CEO S
Gopalakrishnan, has said that they are seeing “greater demand for services from our
clients.” The supply of quality talent however, continues to dwindle, with the continued economic
Just a few days ago, on the 16th of June, outsourcing firms including Tata Consultancy Services
(NSE:TCS), Wipro (NYSE:WIT), Cognizant (NASDAQ:CTSH) and Infosys, all lodged a complaint against
fellow outsourcer, Accenture (NYSE:ACN), due to violation of campus recruitment norms in India. Indian
outsourcing companies often recruit employees out of campuses in India as a recruitment strategy. The
companies begin placement by the final semester of the school year in accordance with Nasscom.
Accenture, however, has been accused of sending placements out a semester ahead of its competitors,
Aside from that, the company has also implemented a new program called Green Channel, in an effort to
hire back ex-employees of the company, thereby reducing time spent on training new employees.
Infosys, last year is reported to have hired 20,000-22,000 people who were from non-computer science
backgrounds. For the last quarter, the company hired only 1,026 staff, which is comparably the slowest
Attrition Problems
It is not only hiring that has affected Infosys’ margins, efforts to cut back on attrition within the
company haslead to increased wage hikes among employees.”Companies have given an average wage
hike of 12-14 percent offshore and 2-3 percent onsite to be competitive in an improving demand
This has however, contributed to the company falling short in its numbers. The company’s attrition rate
has shot up to 15.8% as compared to 11.1% one year ago and 13.4% last quarter. There were a total of
According to company Board Member T.V. Mohandas Pai, “with the market opening up, attrition has
increased this quarter. We have taken several steps, including a compensation hike to reduce it.” He
further adds that, “one of the steps we are taking to reduce attrition is to enhance lateral hiring.”
Economic Problems
“Profitability was also hurt by currency volatility, a 30.4% higher tax charge and lower billing rates”, said
Chief Financial Officer V. Balakrishnan. A stronger rupee and the 1.6% fall in billing rates have affected
the company’s operating margins. Based on currency, the dollar rose 8% against the euro and 5%
against the pound, mainly due to the European debt crisis, affecting the dollar revenues of the company.
Currently the company’s second largest market after the US, Europe’s debt crisis has affected the
outlook for demand and the company’s margins. Company COO S.D. Shibulal, has said in a statement
with Reuters that, with Europe, “there are still concerns, local concerns as well as tail effects of the
previous recession. Of course, Europe entered the recession late and we believe it will also come out
late.”We believe that Europe will lag behind the U.S. for may be another quarter or two.
With the release of the Infosys’ quarter results; it would seem at this point that India’s number two
exporter is lagging behind its current rivals. Judging from the results released by fellow Indian
outsourcer, Tata Consultancy Services, Infosys will need to play catch up for the next quarter.
Author: Audrey B.
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Detailed Result
Type
Audited
Date Begin
01-Apr-09
Date End
31-Mar-10
Amount(Rs.
Description
million)
Gross Profit
95,810.00
General Administrative Expenses
-12,470.00
Selling and Distribution Expenses
-9,740.00
Depreciation
-8,070.00
Operating Profit Before Interest
65,530.00
Interest
0.00
Exceptional Items
90.00
Provision for Investments 90.00
Net Profit
58,030.00
Equity Capital
2,870.00
Face Value (in Rs)
5.00
Reserves
217,490.00
EPS before Extraordinary items (in Rs)
Pledged / Encumbered
Number of Shares
0
Percentage of Shares (as a % of the total shareholding of promoter
and promoter group)
0.00
Number of Shares
92,084,978
Percentage of Shares (as a% of the total shareholding of promoter &
prom group)
100.00
INFY)
70.52USD 3.21(4.77%)
On Oct 2
Top of Form
Bottom of Form
View: Annual DataQuarterly Data All numbers in thousands
Assets
Current Assets
Inventory - - -
Accumulated Amortization - - -
Liabilities
Current Liabilities
Minority Interest - - -
Negative Goodwill - - -
Stockholders' Equity
Preferred Stock - - -
Treasury Stock - - -
Top of Form
Bottom of Form
View: Annual DataQuarterly Data All numbers in thousands
PERIOD ENDING 31-Mar-09 31-Mar-08 31-Mar-07
Operating Expenses
Research Development - - -
Non Recurring - - -
Interest Expense - - -
Non-recurring Events
Discontinued Operations - - -
Extraordinary Items - - -
Other Items - - -
Top of Form
COMPETITORS Submit
Bottom of Form
SAY =
Pvt1 = Tata Consultancy Services Limited
Top of Form
Bottom of Form
View: Annual DataQuarterly Data All numbers in thousands
Changes In Inventories - - -
Net Borrowings - - -
Born on August 20, 1946, N.R. Narayana Murthy is a B.E. Electrical from University of Mysore (1967) and
M.Tech from IIT Kanpur (1969). Narayan Murthy began his career with Patni Computer Systems in Pune. In
1981, Narayana Murthy founded Infosys with six other software professionals. In 1987, Infosys opened its first
international office in U.S.A.
With the liberalization of Indian economy in 1990s, Infosys grew rapidly. In 1993, the company came up with its
IPO. In 1995, Infosys set up development centers across cities in India and in 1996, it set up its first office in
Europe in Milton Keynes, UK. In 1999, Infosys became the first Indian company to be listed on NASDAQ. Today
(in 2006), Infosys has a turnover of more than $ 2billion and has employee strength of over 50,000. In 2002,
Infosys was ranked No. 1 in the "Best Employers in India 2002" survey conducted by Hewitt and in the Business
World's survey of "India's Most Respected Company." Conducted in the same year.
Along with the growth of Infosys, NarayanaMoorthy too has grown in stature. He has received many honors and
awards. In June 2000, Asiaweek magazine featured him in a list of Asia's 50 Most Powerful People. In 2001,
Narayana Murthy was named by TIME/CNN as one of the 25 most influential global executives. He was the first
recipient of the Indo-French Forum Medal (2003) and was voted the World Entrepreneur of the Year - 2003 by
Ernst and Young. The Economist ranked Narayana Murthy eighth on the list of the 15 most admired global
leaders (2005) and Narayan Murthy also topped the Economic Times Corporate Dossier list of India's most
powerful CEOs for two consecutive years - 2004 and 2005.
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