Willing to take the ongoing European crisis in its stride, IT bellweather Infosys, usually conservative in announcing its business outlook, raised its revenue guidance for the current fiscal year. S. Gopalakrishnan, CEO and MD, spoke to HT after announcing the company's first quarter results. Excerpts:
You have raised your revenue outlook by 7 percentage points. What makes you so optimistic?
Our guidance is based on feedback from our clients that point to increased business in the coming months. Revenues from our core business verticals such as BFSI (banking, financial services and insurance), retail and manufacturing have increased and so have business opportunities in North America, our main revenue driver. Offshoring is expected to grow further in coming months.
But aren't you worried about the ongoing crisis in Europe?
Europe continues to be an important region for our company and after North America. It is the second-largest revenue grosser for us. The European crisis will wane off in the short term. In fact, our larger strategy is to have a 40:40:20 ratio whereby North America will account for 40 per cent of revenues, Europe another 40 per cent and the rest of the world, includeing Africa, Latin America, India, China and West Asia, account for the remaining 20 per cent.
Are you planning to acquire any firms in Europe?
Yes we will look at acquiring smaller firms with deal size of $300 to $500 million in the BPO (business process outsourcing), enterprise planning, and consultancy areas.
Tell us about your strategy to counter currency fluctuation.
Currency fluctuation is difficult to predict. Our current hedging strategy involves remittances for two future quarters. We have $700 million as a hedge against currency fluctuations.