Q2FY18 was tumultuous: Infosys co-founder Nilekani after Q3 net rises 37.6%

Infosys CEO Salil Parekh with co-founder and non-executive chairman Nandan Nilekani (Photo: Saggere Radhakrishna)
Country's second-biggest IT services exporter Infosys Ltd posted a 37.6% jump in third-quarter profit, helped by tax benefits from the firm's deal with US Internal Revenue Service.

Co-founder and non-executive chairman Nandan Nilekani congratulated Infosys' finance team for pulling off a "flawless buyback". Nilekani said he's 'delighted' Salil Parekh has joined as new CEO and appreciated the contribution of Rajesh Murthy to the company. The company president will leave on January 31 for personal reasons.

Nilekani described previous quarter as 'tumultuous'.

This is the first quarterly results since Salil Parekh took charge as the new CEO and MD at Infosys on January 2.

Parekh's appointment came after the abrupt resignation of Vishal Sikka, who had quit in August following a public spat with co-founders led by N R Narayana Murthy.

In his first media interaction after taking charge as Infosys CEO and MD on January 2, Parekh today said that his immediate priorities would include connecting with employees and clients to build a "roadmap for future" that will be announced in April.

Stressing that each of its clients is facing digital disruption, Parekh said that this creates an opportunity for the company.

He said that building on strategy initiated by Infosys Chairman Nandan Nilekani, the company is conducting a review structured around four dimensions, namely, new market opportunities, client relationships, people, and service offering portfolio.

"Over the next three months, I am meeting with several of our clients, employees, partners... working with our leadership team and the Board to test the assumption and the approach and then build a comprehensive view along with four critical elements," he said.

Parekh added that the entire exercise would be concluded by April when he lays out the "strategic priorities" for the company going forward.

"Our Q3 performance is strong. We are progressing towards stability and are well positioned to serve our clients in the new areas of demand," Parekh said.

"Digital disruption in the market a good opportunity for Infosys," Parekh added. 

Infosys CFO M D Ranganth descibed Q3 performance as 'resilient on multiple dimensions'.

"During the quarter, Infosys concluded the largest share buyback programme if Rs 130 billion and free cash flow grew 23% during the quarter," he said.

"Challenge is to position business in terms of opportunities. During Q3, Infosys saw budget cuts from some US clients," Parekh said at the press conference to announce quarterly results.

COO Pravin Rao sees more opportunities for Infosys in Europe as compared with US.

"Digital offerings and new services helped stabilise price realization. Attrition has come down from 'high levels' to 15.8%," Rao said.

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel