Infosys revamp under Vishal Sikka brings in more large deals
Infosys Ltd, India's second-largest software services exporter, said on Tuesday a business revamp initiated by its first non-founder boss helped it win more large deals in the first quarter, fuelling a 5% rise in net profit.business Updated: Jul 21, 2015 16:39 IST
Infosys Ltd, India's second-largest software services exporter, said on Tuesday a business revamp initiated by its first non-founder boss helped it win more large deals in the first quarter, fuelling a 5% rise in net profit.
Shares of Infosys surged 11% after the announcement, in which the Bengaluru-based company raised its closely watched US dollar-denominated revenue estimate for the year.
Infosys, a bellwether for India's $150 billion IT services industry, has in recent years struggled to innovate and retain market share due to a staff exodus that also hurt its ability to win big deals.
Under chief executive Vishal Sikka, brought in about a year ago to chart a new strategy, Infosys has made bets on automation and other high-margin services such as artificial intelligence and digital technology to regain ground lost to rivals including leader Tata Consultancy Services Ltd.
"Efforts in redesigning our clients' experience and our widespread adoption of innovation, both in grassroots and breakthroughs, are starting to bear fruit in large deal wins and in the growth of large clients," Sikka said in a statement.
Infosys added 79 clients in April-June, taking its total to 987. Client wins included a multi-year contract from a major German bank for application maintenance services, digital and mobility services, package implementation, and testing services.
Infosys also said it kept its rupee-denominated revenue growth view for the business year through March at a range of 10% to 12%. But it raised its outlook in dollar terms to 7.2% to 9.2%, from 6.2% to 8.2%.
For April-June, Infosys said order growth rose 5.4 percent from three months prior, the most in nearly five years. That was bolstered by a surge in demand in the United States, its biggest market, where the company is also listed.
Infosys, which provides IT services to clients like Apple Inc, Volkswagen AG and Wal-mart Stores Inc, consolidated net profit to Rs 3,030 crore for the June quarter, up from Rs 2,886 crore a year ago. Consolidated revenue for the quarter was up 12.4% to Rs 14,354 crore, from Rs 12,770 crore in April-June, 2014.
Staff attrition, or the number of employees leaving or retiring, was 14.2%, from 23.4% a year earlier.
Shares of Infosys were up 10.7% at Rs 1,108.40 in Tuesday morning trade, versus a 0.2% rise in the broader Mumbai market index.
($1 = Rs 63.6750)
First Published: Jul 21, 2015 13:10 IST