Bangalore, July 13 (ANI): Information technology major Infosys is hopeful of regaining its lost market share despite cut-throat competition and a possible change in the visa rules by the United States.
Infosys CEO and Managing Director Shibulal said a focus on proprietary software at the expense of IT outsourcing contracts was responsible for the disappointing results of the past two years.
Nonetheless, the company is determined to compete with other competitors, he said.
"So, we are definitely more aggressive in going after growth. There is no doubt. It is not only in the outsourcing (IT) contract, it is in every other thing which we do," said Shibulal.
Infosys also maintained its revenue growth forecast for the current 2013/14 financial year, defying some expectations that it would cut its target if the business outlook remained poor and sending its shares up as much as 15 percent, he said.
After declaring its latest quarterly earnings, Shibulal said prime IT contracts are now priority for the company.
He said Infosys it had added 66 new clients in the fiscal first quarter that ended June 30 and that a re-bid of a contract is all set for renewal.
Investors cheered the results of Infosys and strategy turnaround, sending its shares to their loftiest in almost three months.
Further, Shibulal said that the company would focus on superior financial performance, moving to the next quarter.
"It is not about one week change; it is about the focus on superior financial performance which is as I explained. If you look at the last three quarters and actually even slightly before we have put a lot of effort to look at large outsourcing rates. If you look at our revenue growth over the last few quarters, you will see that our consulting system integration (sic) has actually grown above average, quarter on quarter and year on year for the last two quarters," added Shibulal.
But the revenue growth forecast of 6 to 10 percent still lags the 12 to 14 percent outlook for the sector made by local IT industry lobby National Association of Software and Services Companies.
And looming large over all Indian IT companies is the possibility that the United States, the sector's biggest market, will implement as early as next year new visa rules that will make it more costly and difficult to send workers there.
Shibulal also said that the company has given mass promotions and also increased salaries and perquisites of its employees.
"We have given compensation increase across the board. We have eight percent increase to our sales folks, we have given eight percent increase to our off shore folks. We have three percent for our on site folks. We have given compensation in Q4 (fourth quarter) and we have given promotions. So, I expect that you know the appreciation (sic) will come down at least marginally over the two to three quarters," said Shibulal.
Infosys derives 62 percent of its earnings from North America and is the most exposed of its rivals to the region.
Infosys, and its rivals, may get a boost from forecasts that 2014 will see the strongest demand for technology from U.S. Government institutions and businesses since the 2008 global financial crisis.
Regaining investors trust remains a challenge, Infosys stock lost 16 percent of its value last year, but the company has pinned its hopes for a revival on founder Narayana Murthy whom it brought back as Executive Chairman in June. (ANI)