New Delhi: Team Infosys has been following a policy of changing the old order to make place for the new, for a while now.
Nandan Nilekani, who is the CEO and managing director of the company, is now taking on a new role — that of executive co-chairman while Kris Gopalakrishan will step into his shoes and Shibulal will be the new COO.
While projecting a 28-30 per cent growth in dollar terms guidance for FY08, Infy's Chairman of Board and ‘Chief Mentor’, NR Narayana Murthy said the management changes reflected the depth of managerial skills in his company.
“It is a testimony to the value system of the people in the company that people who have been hugely successful like Nandan, Mohan, for example. They all said that we have had our days in the sun, we want others too to have day in the sun because they are as competent as we are. And I think to take such a stand and give-up when you are at a height of your glory requires a man of steel and I am glad that at Infosys, we have lots of them,” Murthy was quoted by CNBC-TV 18.
Nandan Nilekani who’s become the new Co-Chairman, has assured that he will still have an executive role to play at Infosys. Nilekani would focus on key client relationships and transformational initiatives.
Infy beats estimates once again
Nilekani believes that Infy still enjoys a firm outlook and would be looking at global growth. He said that the 3 per cent dilution in EPS (earning per share) was due to ESOPs allotment.
“I think we are standing here on April 13, and guiding for 28-30% growth in dollar terms - that is the confidence we have for our performance in the coming year. Secondly, if you look at the earnings profit growth for next year, it is very similar at 29-31%. I think this is a very strong guidance for the year.”
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Infy is aiming to offset the wage inflation of 13-14% on the rupee side that they are expecting, or the rupee appreciation, through better optimization of its SG &A (Selling, General and Administrative Expenses).
Currently, Infosys has two ESOP schemes. As on Jan 1, Infosys had 17 million on ESOPs shares and added 13 million in Q4. The margin impact due to wages increasing in FY08 will be 300 bps.
Infy’s top 10 clients have grown by 15.5 per cent in Q4 FY07, said Nikelani. According to Infy honchos, another positive factor working for the Indian IT industry is the American companies’ pressure to cut their costs. Besides, the European companies are facing challenges on profit margins and are looking for outsourcing opportunities.
UK is predicted to be the biggest growth market. Switzerland, Germany and France are identified as the others. The Infy Board has approved a subsidiary in Mexico and its subsidiary in Bruno will be inaugurated next month.
Infosys also has struck a new deal with ABN Amro. “This order is a sub $50 million multi year deal, we always pursue a number of large deals and this happened to be one of them and we have closed two large deals this quarter both sub $50 million, one is from ABN and another one is a major entertainment player in US,” said SD Shibulal, Group Head – Worldwide Sales & Customer Delivery, Infosys.
A heartening fact for them is that 93% of its business is repeat business. Out of their 150 clients, 114 are Fortune 500 clients, and 275 clients are over USD 1 million clients.
The success of Infosys can be attributed to its ability to tap key personnel, and passing on the knowledge and responsibility baton to them. This, backed by appropriate powers has been yielding results that have been fulfilling in more than one ways.
The Team Infosys includes NR Narayana Murthy, Chairman of Board and Chief Mentor, Nandan Nilekani, Co-Chairman; S Gopalakrishnan, CEO & MD; V Balakrishnan, CFO, SD Shibulal, COO, Infosys, Subramanyam GV VP- Software Engg and Srinivas BG as Senior VP & Head-EMEA.
With inputs from moneycontrol.com
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