Global Rivals Muscle In
Bangalore, Sept 19: Infosys, benefiting from increased global demand for cheaper outsourcing, beat earnings estimates in July with a 28 percent jump in quarterly profit on the year and raised its full-year profit growth forecast to 17 percent from a previous 13 percent. The 17,000-employee strong company earns the majority of its revenue from North America. Bank of America Corp and American Express Co are among its main customers.
I think offshoring and outsourcing are very much on the mainstream agenda of most of the worlds largest corporations, and they are seeing this not just as a cost play but as a way to improve quality and productivity, Nilekani said in an interview.
Infosys shares closed 1.61 percent lower in Bombay on Thursday, while Bombays main 30-share fell 2.39 percent. Last week, Infosys, which in 1999 became Indias first company to list on the tech-laced Nasdaq, won a $50 million five-year service contract from Telstra, one of its large existing clients.
The Telstra deal softened scepticism among analysts, who have been watching Infosys since its rivals Wipro, Indias second largest listed software firm, and Tata Consultancy last year, jointly won a deal from Lehman Brothers to manage computer networks but hit roadblocks after a technology slowdown and September 11 attacks in the United States.
The company then balanced its ambitious plans to focus on high-margin consulting with its low-cost work based on large-scale hiring, which also faces threats of staff-poaching from big firms such as Accenture, which are furiously expanding their Indian operations.