Posts Tagged ‘Infosys’

Daimler Begins IT Transformation with Infosys

July 29th, 2014

Company have handed over European data centre keys to Bangalore-based Infosys.Outsourcing4

Daimler, the German automobile company that manufactures Mercendes Benz, is making moves towards the cloud after handing over management of its European data centres to Infosys.

Infosys will manage Daimler’s infrastrastructure, data centre, middleware and database operations from its Enterprise division in India’s technology hub, Bangalore.

Daimler previously used HP to support its key systems. Prior to that, Fujitsu Siemens managed its servers and databases from2008.

The contract is the first step Daimler is taking to transform its IT infrastructure. It reflects Bangalore’s growing influence in the European, and specifically German market.

Infosys reported a revenue and profit rise ahead of Vishal Sikka, former SAP technology chief’s takeover as CEO this week.

It is believed that Sikka’s Silicon Valley background and connections will accelerateInfosys’ growth strategy through acquisitions as well as shifting the focus to non-linear services and higher margin IP products.

The outsourcing deal coincides with Daimler’s launch of the world’s first autonomous truck this month, allowing speeds of up to 80 kilometres per hour.

In its financial results, Daimler said the “Truck 2025″ indicates the “long-distance trucks of tomorrow and future transport systems. This is based on the intelligent networking of all existing safety systems, supplemented by cameras, radar sensors and the possibility of communication between vehicles”.

The manufacturer said that the new truck could be available on the road within five years, “but due to the complex situation of heavy commercial vehicles, a timeframe of 10 years is realistic”, it said in its financial results on Thursday.

However, the automotive industry has a lot to learn about software patching throughout the supply chain before connected cars reach critical mass, security experts have warned.

Increasingly businesses are moving the management of their infrastructure off-premise so that IT can focus on product releases like the Truck 2025.

Ruchir Budhwar, Infosys vice president and head of automotive in Europe, said: “Radically changing markets and customer demands are making manufacturers relook at their technology backbones to seek solutions that enable rapid response at manageable costs and without disruption. Such solutions allow companies to react quickly, at low cost and without downtime. Infosys will manage the day-to-day data centre operations driven by a shared vision to innovate and transform these facilities.”

Daimler has kept tight-lipped over the deal, refusing to confirm contract details including cost and time-scale.

TCS continues to outpace Infosys, revenue gap widens to Rs 33,313 cr

July 23rd, 2014

India’s largest IT services exporter, Tata Consultancy Services (TCS), has been outperforming its peers consistently and the gap with its rivals is continuing to widen. For instance, in FY10, the revenue difference between TCS and Infosys was Rs 7,559 crore, but by the end of FY14 it stood at Rs 33,313 crore. Similarly, the difference in net profit between the two firms in FY10 was Rs 782 crore but at the end of FY14, it has reached to Rs 8,516 crore.Outsourcing31

Though TCS always enjoyed a higher revenue base but it was Infosys which reported superior operating profit margins (OPM) setting a benchmark for the Indian IT industry. Even this index seems to be undergoing a change. From the second quarter of FY13, TCS has started to report higher margins. At the end of FY14, TCS reported an OPM of 29.1% while it was 25% for Infosys. TCS also has over 3 lakh employees now, which is roughly double that of Infosys which has 1.6 lakh employees on its rolls.

TCS has started FY15 also on a very strong note by recording a 5.5% sequential revenue growth in US dollar terms for the first quarter with volumes growing at 5.7%. Infosys on the other hand grew its revenues only by 2% in the first quarter, with volumes growing by 2.9%. TCS has already stated that it would beat the industry growth guidance of 13-15% in US dollar for the fiscal as projected by Nasscom, while Infosys has retained its revenue guidance at 7-9%.

Pradeep Mukherji, president, Avasant, an IT outsourcing advisory firm, told FE, “TCS is one of the most robust companies in terms of their depth in leadership, range of offerings and the extent of geographic reach. Their DNA is completely different.”

TCS’ revenue is more evenly spread out across the globe with North America dominating the pie at 53%. Most of its peers derive 60% of their revenues from the North American market. It generated 2.3% of its revenue from Latin America, having centres in places such as Brazil, Uruguay, Chile, Colombia, Peru and Argentina. The IT major has also made similar strides into a region like Africa.

Industry observers say that TCS chief executive office N Chandrasekaran who took over this role in October, 2009 has instilled a new dynamism to the company. “Chandrasekaran has certainly brought in new level aggression to TCS which we had not seen earlier,” said a senior industry executive, who did not want to be identified.

TCS is a cut above the rest in employee retention too despite its employee base crossing over 300,000 with people representing 118 nationalities. At the end of first quarter this fiscal, the attrition rate at TCS was 12% while it was 19.5% in the case of Infosys. Sanchit Vir Gogia, chief analyst & CEO, Greyhound Research, said, “Employee retention and their happiness is very important to an IT company as it has a direct bearing on customer satisfaction. Here, TCS has performed really well.”
The number of $100 million clients in TCS’ kitty stood at 24 for FY14 while it was 13 for Infosys and 10 for Wipro. TCS has also morphed into a company that takes decisions in double quick time. “It is also giving certain amount of operational freedom to various units while this has not been the case with many of its rivals,” said a senior industry observer.

TCS, Infosys, Wipro and HCL Technologies together account for close to 40% of India’s IT services revenues, but the degree of separation between the four have started to tell a story of its own. TCS ended FY14 with a revenue growth of 16.2% in US dollar terms while it was 11.5% for Infosys and 6.4% for Wipro.

Partha Iyengar, vice-president and analyst at research firm Gartner said, “It has already started, you cannot talk about Indian services companies as one unit anymore. You have to talk about individual companies and talk about their fortunes in terms of how is it is evolving and how successful or not they are. You will see increasing separation between the companies.”


Infosys denies allegation that it discriminated against Harley contract worker

July 15th, 2014

Infosys Ltd., an IT staffing firm hired by Harley-Davidson Inc. to outsource its internal IT functions, is denying claims after being sued for discrimination in a class action lawsuit over its practices in staffing the Milwaukee motorcycle manufacturer’s project.Outsourcing22

Kelly Parker, a former contract worker, and Brenda Koehler, of Milwaukee, allege in the lawsuit that the outsourcing firm discriminated against American workers a year ago by replacing them with workers from South Asia. Infosys, which is based in India, has disputed the claims saying that the company faced a talent shortage in the U.S.

The case was filed in the U.S. Eastern District Court of Wisconsin in August 2013.

“Selection was based on skills and experience of the individuals. We reject any accusation that Infosys discriminates against applicants or employees based on their nationality or race,” according to a statement by Tara Kozak-Lindsay, a spokeswoman for Infosys. “When we use H-1B visas to bring people with specific skills for short term engagements to work on projects for our clients, their salaries meet or exceed US Department of Labor mandated minimum levels for respective job categories. In addition, we recruit US residents to support our growing business. Today we have over 440 active openings across 20 states in the US for local hires.”

At the time, Infosys had 17 locations and the center was expected to train 125 people, but Harley laid off 125 of its employees and of those, 83 were expected to have “preferential consideration” for Infosys jobs.

Infosys did not identify how many workers were hired onto the project, but Harley confirmed that some were hired.

“We told them that they had to create a data center in Milwaukee, which it did,” said Maripat Blankenheim, Harley’s director of external communications. “It had to look at the existing employees, but they were not required to take them. A lot of our employees got jobs here. It’s not that we wanted to shed those employees; we actually hired some back in newly created positions. So it was a net gain of Harley-Davidson employees to manage the work.”

But the federal lawsuit alleges that at least one of the Harley contract workers was discriminated against.

According to federal court documents, Parker worked for another third-party contractor, Enterforce Inc., that Harley had used to provide global information services to its internal customers before it hired Infosys Ltd.

Parker, who performed contract work at Harley’s Tomahawk location from February 2012 through May 2013, interviewed with Infosys for the position she was already performing twice, but it never hired her, according to the complaint. The complaint also alleges that Parker trained a man who was an Indian national who then took over her duties, and in August 2013 Parker was fired by Infosys because her desk area wasn’t tidy and she was late to work one day.

In November 2013, Infosys paid $35 million to settle claims made in another federal suit that it fraudulently used methods to get “cheap visitor visas for its personnel,” according to a story by CNBC. That case stemmed from the actions of former Infosys employee-turned whistleblower that helped lead to a backlash against the use of H-1B and other visa programs.

Infosys denied guilt in the case, but it paid the largest amount for an immigration case.


India’s Infosys profit up 21% on US deals

July 11th, 2014

Indian outsourcing giant Infosys reported on Friday a better-than-expected 21 per cent jump in quarterly net profit, after winning new deals from US clients.Outsourcing18

The Nasdaq-listed firm said consolidated net profit climbed to 28.86 billion rupees ($481 million) in April-June from 23.74 billion rupees in the same period a year earlier.

Shares in the firm surged 4.16 per cent to 3429.35 rupees in response to the announcement.

India’s second largest IT services exporter by sales, which is based in the southern high-tech city of Bangalore, said it had signed 61 new clients in the quarter.

The results come after Infosys last month announced a new chief executive and said its co-founder N R Narayana Murthy was stepping down as executive chairman following a string of high-profile departures.

Vishal Sikka, a former top executive from German giant SAP, takes over as chief executive next month.

Murthy left after returning from retirement as executive chairman in June last year to help revive the company’s fortunes.

Infosys — created three decades ago by Murthy and six others around a kitchen table — has been losing market share to rivals such as Tata Consultancy Services and HCL.

In October, it said it would pay $34 million to the US government to settle an investigation into alleged visa fraud by the company.

Many of India’s IT outsourcing firms have reported subdued growth in recent years due to a global economic slowdown.


Infosys beats estimates, Q1 profit rise 21.6 pc

July 11th, 2014

Software behemoth Infosys posted a YoY growth of 21.6% with Net profit at Rs 2,886 crore for the quarter ended June 30, 2014 riding on outsourcing contracts it bagged.Outsourcing17
Beating estimates and despite high employee attrition, Infosys revenues were Rs 12,770 crore for the quarter, registering QoQ growth of 0.8%. Q1 revenue growth was at 13.3% YoY in INR terms.

India’s second largest software exporter’s FY 15 revenues are expected to grow 7%-9% in USD terms; 5.6%-7.6% in INR terms.

Its Earnings per share (EPS) was Rs 50.51 for the quarter ended June 30, 2014

According to the company, Liquid assets including cash and cash equivalents, available-for-sale financial assets, certificates of  deposits and government bonds were Rs 29,748 crore as on June 30, 2014 as compared to Rs 30,251 crore as on March 31, 2014.

Infosys and its subsidiaries added 61 clients during the quarter and 11,506 employees (gross) during the same period.

The company has 161,284 employees as on June 30, 2014 for Infosys and its subsidiaries.

“We continue to enjoy the confidence of our clients by demonstrating superior execution capability and value realization.” said S. D. Shibulal, CEO and Managing Director.

“As I transition the CEO mantle to Vishal, I am confident that he will leverage this strong foundation to take Infosys to greater heights. I wish him the very best.”

U. B. Pravin Rao, COO, said: “We saw positive trends in our large deal wins during the quarter. We believe that this momentum will hold us in good stead as we focus on increasing volumes.”

“Employee attrition rates are worrisome and we are implementing various initiatives to retain good talent,” he said.

Rajiv Bansal, CFO, said: “We improved operational performance as a result of our cost optimization initiatives and a focus on increasing productivity and utilization. This partially offset the impact of compensation increases for our employees this quarter.” said . “It will help us invest in areas that will accelerate growth.”


Infosys Technologies Now Covered by Analysts at Stifel Nicolaus

July 11th, 2014

Stock analysts at Stifel Nicolaus assumed coverage on shares of Infosys Technologies  in a report issued on Tuesday, reports. The firm set a “hold” rating on the stock.Outsourcing16

Other equities research analysts have also recently issued reports about the stock. Analysts at Zacks reiterated a “neutral” rating on shares of Infosys Technologies in a research note on Thursday, June 19th. They now have a $57.00 price target on the stock. Analysts at Jefferies Group initiated coverage on shares of Infosys Technologies in a research note on Friday, April 25th. They set a “buy” rating and a $60.00 price target on the stock. Three investment analysts have rated the stock with a hold rating and eight have issued a buy rating to the company’s stock. Infosys Technologies has an average rating of “Buy” and a consensus price target of $60.67.

Infosys Technologies opened at 55.03 on Tuesday. Infosys Technologies has a 52-week low of $42.02 and a 52-week high of $63.20. The stock’s 50-day moving average is $53.20 and its 200-day moving average is $55.63. The company has a market cap of $31.444 billion and a price-to-earnings ratio of 18.15.

Infosys Technologies last posted its quarterly earnings results on Tuesday, April 15th. The company reported $0.85 earnings per share for the quarter, beating the analysts’ consensus estimate of $0.80 by $0.05. The company had revenue of $128.75 billion for the quarter, compared to the consensus estimate of $129.14 billion. During the same quarter last year, the company posted $0.78 earnings per share. Infosys Technologies’s revenue was up 23.2% compared to the same quarter last year. Analysts expect that Infosys Technologies will post $3.29 EPS for the current fiscal year.

Infosys Limited (NASDAQ:INFY), formerly Infosys Technologies Limited, provides business consulting, technology, engineering and outsourcing services.


Infosys Q1 profit up 21.6 pct, retains annual forecast

July 11th, 2014

Infosys Ltd , India’s second-largest software services exporter, beat estimates with a 21.6 percent rise in quarterly net profit and retained sales growth outlook for this year on surging demand for outsourcing services.Employees walk in front of a pyramid-shaped building at the Infosys campus in the Electronic City area of Bangalore

Infosys, which named Vishal Sikka, a former senior executive at German software company SAP AG (SAPG.DE), as CEO last month, has been reeling under a staff exodus and loss of market share to rivals.

The staff departures are a major worry for the company, which saw its annualised staff attrition rate touching a record high of 19.5 percent in the quarter ended June 30 from 18.7 percent in the previous quarter.

“Employee attrition rates are worrisome and we are implementing various initiatives to retain good talent,” Chief Operating Officer U.B. Pravin Rao said in a statement to accompany the results on Friday.

Infosys, which added 61 customers in the quarter, maintained its revenue growth forecast for the year to March 2015 at 7-9 percent, as expected.

Consolidated net profit for the quarter ended June 30 rose to 28.86 billion rupees ($480.20 million) from 23.74 billion rupees in the same year-ago period, Bangalore-based Infosys said in a statement on Friday.

The profit was higher than the 26.72 billion rupee average of analyst estimates, according to Thomson Reuters data.

Revenue in the quarter rose 13.3 percent to 127.70 billion rupees.

Infosys customers include BT Group Plc, Bank of America and Volkswagen AG.


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