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  1. Infosys to continue with strategy of buying niche high-tech firms

Infosys to continue with strategy of buying niche high-tech firms

India's second largest IT services exporter, Infosys, will continue with its acquisition strategy of buying out niche high technology companies which are expected to boost its growth path in the near future.

By: | Bengaluru | Published: March 4, 2016 1:29 AM

India’s second largest IT services exporter, Infosys, will continue with its acquisition strategy of buying out niche high technology companies which are expected to boost its growth path in the near future.

Addressing the Morgan Stanley TMT conference in San Francisco, Infosys CEO Vishal Sikka said, “We will make acquisitions, small ones, very niche, high technology, complex technologies that give us a jump in our road forward.”

Infosys under Sikka has been active on the acquisition front having bought out companies such as Panaya, Skava which gives it a strong foothold in newer technology areas.

On the growth prospects of Infosys in the future, Sikka said, “Our endeavour is to have consistent profitable growth – that has been our philosophy; we don’t believe in sacrificing margins in order to grow. We are on track to get to industry leading growth in next financial year. We want to be a global leader in this new kind of IT services.”

Infosys has already revised its annual revenue growth guidance upwards for FY16 to 12.8-13.2% on a constant currency basis. It has set a goal of achieving a revenue of $20 billion by FY21 which will include a operating profit of 30% and $80,000 revenue per employee.

Sikka said that the deal wins for Infosys has been encouraging especially in the large accounts segment. “For the first time in many years, our large accounts growth rate has exceeded the growth rate of the company which is quite encouraging,”he added.

According to Infosys CEO, software defined innovation will be the key differentiating factor for the company to generate higher revenues. “We have to bring in the expertise in software, in selling IP and getting into more and more outcome-based, fixed price projects so that the power of automation can benefit us as well as the clients,” he said.

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