Wipro in biggest automation push since Holmes AI platform

Wipro, which launched its artificial intelligence platform Holmes 18 months ago, is currently making its largest push to embrace automation by permitting more of its managers to identify work which shall not require engineers in each of the more than 20,000 projects presently underway. This bold development will mean that Wipro does not just save on costs, but fundamentally alters the conventional model of deploying armies of engineers to undertake work involving maintenance. To be sure, that could also mean that its present workforce needs to learn novel technology skills quickly to stay relevant.

Wipro is in the process of appointing individual leaders in each of the 6 industry-serving segments and 5 solution offering verticals or practices, who shall be entrusted with the job of automating everyday maintenance work.

Until now at Wipro…

K.R. Sanjiv – Wipro’s chief technology officer, in consultation with numerous segment heads utilised to decide which projects could use Holmes. Wipro’s 2 larger rivals, TCS and Infosys, too have a similar centralised division that oversees the adoption of their respective intelligent automation platforms named Ignio and Mana. This explains why these companies which employ lacs of engineers have embraced automation only in tiny pockets.

At Wipro, this shall now change…

Last month Abidali Neemuchwala, CEO of Wipro said that they announced internally in this quarter that they will have a more federated structure than running it from a centralized unit, which will further increase the pace of adoption.

Hyper-automation is among the central pillars of Neemuchwala’s vision of making Wipro a 15 billion-dollar firm by 2020 with an operating margin of 23 per cent. Wipro ended the year to March with 7.35 billion-dollar in revenue and 20.5 per cent profitability.

A spokesperson for Wipro said that the company was consolidating all its automation assets and capabilities under Holmes brand and significantly enhancing its investment in hyper-automation.

In the first 6 months of the present financial year, Wipro claims to have freed and re-deployed over 4,300 employees in novel areas of work, on account of automation. The management’s decision to decentralise decision-making means that Wipro could look to automate work of around 10,000 engineers by end of the financial year.

Experts are encouraged by the management’s decision:

An expert said that aligned with a market maturation around the broad notion of Intelligent Automation, Wipro was changing gears in the way it was engaging with stakeholders.

An executive said that each of these Holmes leaders would be evaluated on the work they would automate. All of them would have individual targets, he added.

Wipro’s aggressive push towards embracing automation comes at a time when automation platforms and cloud computing are endangering the labor arbitrage enjoyed by Indian IT vendors.

Source: www.dynamiclevels.com

Infosys Revises Pay Packages Of important Executives

Infosys today said that it had revised the pay packages of its top leadership, including COO - Chief Operating Officer U B Pravin Rao and CFO - Chief Financial Officer M D Ranganath. The firm has also inducted founder and Chief Executive Officer (CEO) of Surya Software Systems D N Prahlad as an independent director on its Board, to be in effect from 14^th October, 2016.

Infosys said that the Board of Directors had approved the revised annual compensation of Pravin Rao, with effect from 1^st November, 2016, subject to the approval of shareholders. The compensation includes fixed compensation of Rs.4.62 cr per annum and a variable compensation of up to Rs.3.88 cr per annum.

Meanwhile, Infosys share price hit 52-week low of Rs.996.25 on the NSE today.

Additionally, based on performance of fiscal 2016, Mr.Rao shall get 27,250 RSU - restricted stock units and 43,000 stock options, vested over a span of 4 years.

Apart from Mr.Ranganath, the compensation structure of Head of the Financial Services - Mohit Joshi, Head of Americas - Sandeep Dadlani, Head of Europe - Rajesh K Murthy, Chief Delivery Officer - Ravikumar S, Chief Compliance Officer - David Kennedy, Group Head of Human Resource Development - Krishnamurthy Shankar and Company Secretary - Manikantha AGS have also been revised with effect from 1^st November, 2016.

It said that the revised aggregate compensation of the above individuals encompasses fixed compensation of Rs.24 cr and variable compensation of up to Rs.20 cr. Additionally, based on performance of fiscal 2016, RSU - restricted stock units of 2,45,750 and stock options of 5,02,550 will be granted on 1^st November, 2016, it added. Infosys added 12,717 people at gross level and 2,779 employees on net basis from June quarter, taking its headcount to 1.99 lac employees as on September 30, 2016. The attrition rate was at 20% for the quarter.

Mr Sikka said that Infosys' high performer attrition had come down to 8.9% this quarter from 11.5% in the last quarter on account of company's sharp focus on hanging on to the top performers.

For more details, pay a visit to Infosys share price history.

Infosys Cuts Annual Revenue Target for the 2nd time

Infosys Limited, India's 2^nd largest software services exporter, cut its fiscal-year revenue growth target for the 2^nd time in 3 months on an unsure business outlook, sending its shares tumbling over 5 per cent.

Reporting a 6.1 per cent rise in Q2 or second-quarter net profit, Infosys said on Friday that it now expected revenue to grow between 8 per cent and 9 per cent in constant currency terms in the fiscal year to 31^st March, 2017. Its previous revenue growth target, which was issued in the month of July, was 10.5-12 per cent, already lowered from the up to 13.5 per cent it said it expected in the month of April.

India's more-than-150 billion dollar software services sector depends on Europe and North America for the majority of its revenue. The impending United States presidential election and the implications of Britain's Brexit move to exit the European Union have both weighed on spending by the western clients.

Infosys had warned in the month of August that it was seeing some softness in business after the June Brexit vote in Britain.

Vishal Sikka - Chief Executive said in a statement on Friday that the revision took into consideration their performance in earlier half of the year and the near-term unsure business outlook.

After falling as much as 5.3 per cent after the guidance cut was announced, Infosys share price was trading 2.6 per cent down at 10:23 a.m. in a Mumbai market that was little changed.

In the current Q2, its consolidated net profit rose 6.1 per cent ahead of analysts' estimates. Its revenue rose 10.7 per cent to Rs.17,310 cr.

The company said on Friday that it added 78 clients during the three months to September, taking its total number of clients (active) to a numerical figure of ‘1,136’.

Please visit Infosys share price history for further information on the stock.

Infosys Share Price Tanks To 52 Week Low Post Q2 Results

In a regulatory filing to the BSE Infosys Limited announced its Q2FY17 results on Friday, 14^thOctober 2016 (today). The Company registered a 4.95 per cent quarter-on-quarter (QoQ) rise in its net profit to Rs 3,606 crores for the quarter ended 30^th September 2016.

The second largest IT firm in the domestic market by sales had reported a net profit of Rs 3,436 crores in June quarter.

The numbers were a bit better than Street estimates, given the firm had already informed the stock exchanges of challenges it was facing, owing to ramp down in RBS contract and other client specific issues. That had led to moderation in its earnings expectations. An ET Now poll of analysts had anticipated a net profit of Rs 3,531.50 crores for the quarter.

However, the company lowered its revenue guidance (constant currency) for FY17, which hurt the sentiment.

The company said its net sales stood at Rs 17,310 crores for the quarter against Rs 16,782 crores revenue it reported in the June quarter. The ET Now poll had forecast Rs 17,189.30 crores revenue for the September quarter, up 4.48 per cent QoQ.

The dollar revenue of the IT firm for the quarter stood at US$ 2,587 million against US$ 2,501 million in June quarter. As per analysts poll, the Vishal Sikka-led firm was expected to report a 2.52 per cent quarter-on-quarter growth in the terms of dollar revenues to US$ 2,564 million.

The company cut its FY17 revenue guidance for second time this year to 8 to 9 per cent against 10.5 to 12 forecasts earlier. This was largely in line with Street expectations. The dollar revenue guidance was lowered to 7.5 to 8.5 per cent from 10 to 11.5 per cent earlier.

The company will conduct a 60 minute conference call at 11:30 AM IST where the senior management will discuss the company's performance and answer questions from participants.

According to the leading brokerage houses, Results from tech majors like that of Accenture and Cognizant have indicated mixed demand environment, with stronger adoption of digital technologies. However, the market and the investors will be concerned about the impact of Brexit and the resultant impact on demand in the short term. US elections will also create uncertainty for the sector. Structural growth drivers for Indian IT continue to be in place, but in short term, there is increased uncertainty on demand outlook.

The company board has also announced a dividend of Rs 11 per share. The stock plunged over 5 per cent below Rs 1,000-level following the numbers.

Meanwhile Infosys share price made a 52 week low of Rs 996.25. Currently the share price is trading at Rs 1,037.45, down by 1.42 per cent.

Get the historical share price performance of the share at Infosys share price history.

Infosys Q2 seen to be slowest Sept quarter since 2009

Infosys is expected to report net profit of Rs.3500 cr in July-September, up 1.8 per cent from Rs.3436 cr in Q1FY17. According to a media report, the IT Company may see dollar revenue growth of 2.3 per cent at 2559 million US dollars in Q2FY17 from 2501 million US dollars in quarter-ago period. In terms of rupee, revenue may increase 2.2 per cent at Rs.17150 cr compared to Rs.16782 cr quarter-on-quarter (Q-o-Q).

During the quarter, EBIT is seen at Rs.4182 cr against Rs.4047 cr while EBIT percentage is seen at 24.4 per cent versus 24.1 per cent on sequential basis. Infosys’ FY17 constant currency guidance is expected to be lower to 8.5-10 per cent from 10.5-12 per cent. Infosys had already lowered guidance to 10.5 per cent-12 per cent in constant currency from 11.5-13.5 per cent in last quarter. Dollar revenue growth may be lowered to 8-9.5 per cent from 10-11.5 per cent due to euro and GBP depreciation against dollar.

According to analysts, constant currency revenue growth is seen at 2.8 per cent on forex headwinds of 50 basis points (BPS). Q1 margins are likely to be at the lower end of 24-26 per cent. RBS contract loss shall be in effect till second half of FY17. The revenues from GST could be a partial offset however margins on this contract are likely rather low.

Meanwhile, at 2.41 pm, Infosys share price was trading at Rs.930.60, down 0.66 per cent on the NSE. 

BFSI shall remain to be a key area to watch out because it is one of the key verticals in sector, accounting for 25-40 per cent of revenues for leading companies. 
The IT giant has also indicated early signs of caution mostly in Europe because of Brexit. BFSI revenue growth led the IT sector through FY14 and the early half of FY15. Since then, growth has slowed down because financial institutions have been driving down costs – vendor consolidation and in-sourcing also hurt, at the margin.

For more details please visit Infosys share price history.

Infosys joins hands with SPC for providing IT services

Infosys rose 1.35% to Rs 1,045.75 today on the NSE after the company announced that it has entered into a joint venture pact with Saudi Prerogative Company in Saudi Arabia to conduct IT services for customers there. The announcement was made after market hours on Friday, 2 September 2016.

In the Joint Venture, Infosys owns 70% while the rest 30% will be held by Saudi Prerogative Company. Infosys' 70% in this Joint Venture is a cash investment of $312,671 by the company in the equity share capital of the proposed Joint Ventured Company.The agreement is the matter to the approval of Saudi Arabian General Investment Authority.

Infosys' net profit fell 4.5% to Rs 3436 crore on a consolidated basis.Revenue went up by 1.4% to Rs 16782 crore in Q1 June 2016 over Q4 March 2016. The results are according to the IFRS (International Financial Reporting Standards).

On NSE, so far 16,85,170 shares were traded in the counter as against average daily volume of 3376814 shares in the past 20 days. Infosys share price has hit a high of Rs 1,048.90 and a low of Rs 1,035 so far during the trade. The stock had hit a record high of Rs 1,279.30 on 3 June 2016.

The stock had underperformed the market over the past one month till 2 September 2016, sliding 4.91% as against Sensex's 1.97% rise. Infosys share price had also underperformed the market in past one-quarter; declining 18.19% as against Sensex's 6.29% rise. The large-cap company has equity capital of Rs 1148.47 crore. Face value per share is Rs 5.

Infosys is in the list of top 500 performing stocks picked by Dynamic Levels for the quarter. For support and resistance levels of the stock, check Infosys share price forecast page of Dynamic Levels website.

Infosys is Creating Smaller Business Units

Infosys, India's second largest software services company, is creating smaller business units, headed by a novel line of leaders, as a part of its efforts to improve and enhance market penetration and client management.

Infosys CEO - Vishal Sikka, said at a recent analyst meet that they were expanding the bandwidth of their present presidents by creating smaller business units of 500-700 million dollars headed by their next line of leaders. He added that this would help them in better market penetration and client management.

However, he did not comment on the number of units that would be created or even for that matter the people who would head these entities. Sikka said that the move would help its 4 presidents in addressing long term strategic levers and speed up the novel services.

The 4 presidents are Sandeep Dadlani, Rajesh Krishnamurthy, Mohit Joshi and Ravi Kumar S. 

Sikka also added that while Infosys had a strong leadership depth in the company, it was also infusing external talent. He concluded that they had made progress in attracting a few key external talent to key leadership positions within the company.

Infosys share price update:

Currently, Infosys share price is trading 0.51 per cent lower at Rs.1,035.05 on NSE. The stock opened at Rs.1,037.10 from a previous closing of Rs.1,040.40. As of now the day’s high stands at Rs.1,041.20 While the day’s low stands at Rs.1,031.85. So far, near about 7 lac shares have exchanged hands on the NSE counter having a traded value of Rs.6,904.

Infosys is among the top 500 Shares recognized by Dynamic Levels researchers and stock analysts at the end of each quarter out of the 1700 Shares registered on NSE. The scrip has strong fundamentals and impressive financials. Dynamic Levels also provides support and resistance levels for the stock. Please visit Infosys share price history for more information.

Infosys is available cheaper than Nifty

MUMBAI: Infosys, once the beloved of Dalal Street with behemoth reward for investors since its listing in the year 1993, is for the very first time available cheaper than Nifty in terms of forward price to earnings, despite 46 out of 57 brooking houses who track the counter having buy ratings. 

While Nifty was trading at 17.8 times its one year forward EPS, Infosys was available at 14.6 times, a significant 15 per cent cheaper than the Nifty. India's largest IT exporter TCS - Tata Consultancy Services trades at 19.17 times its forward PE. 

Infosys share price has declined 6 per cent so far this year, as compared to TCS gain of 7 per cent. BSE Sensex gained over 7 per cent since 1^st January. 

Infosys’ revenue in the June quarter was sharply lower than estimates. The IT company’s current valuation discount to TCS measured on estimated 1 year forward P/E is at 25 per cent, lowest since 14^th October.

Infosys is one of the top 500 shares recommended by Dynamic Levels for this quarter amongst the top 1700 stocks listed on NSE owing to the strong fundamentals. The stock opened at Rs. 1047.00 (up by 1.49%) against its previous closing at Rs. 1039.65 and closed at Rs. 1057.40. The 52 week high of Infosys share price is seen at Rs.1,279.30 on 3rd Jun ’16 while the 52 week low is seen at Rs.1,009.10 on 22nd August ’16. The company has market cap amounting to Rs. 238801.85 (Cr) having a book value of Rs. 251.77. The Average Daily Movement of the stock is 25.15 and its average volume for last 20 days is 3793143. The stock yields -3.50% monthly returns and has the PE ratio of 17.18. In order to acquire further information refer to Infosys share price forecast.

Brexit Tremors Hit Again, Infosys Feels the Heat

Brexit had fueled the concerns of adverse affect on Indian Companies over a period. The tremors have begun in just less than two months, and Infosys has been the first to feel the shudder.  India’s second largest software company has been scathed after the Royal Bank of Scotland mothballed its plan for Williams and Glyn.  W&G was the identity of the separate bank that RBS was planning to open in the UK; for which Infosys was a key technology partner for consulting, application delivery and testing services.

Impact: 

The company is said to have lost as much as $50 million and subsequently is said to ramp-down 3,000 employees.
The loss of the contract is going to have an adverse effect on the company’s financials, especially revenue which could be around $ 70-80 million in FY17 and $ 150-200 million in the next financial year.  Infosys will have further to revise its revenue guidance, downgrading by 70-80 bps. This downgrading will be the second for this year.  In July, Infosys had cut its annual sales outlook citing the weak demand. This had triggered the selloff in the stock.

Quarterly Performance:

This is another headwind after the company disappointed the market with its lower-than-expected quarter performance. The company reported the marginal rise in the consolidated revenue by 1.4%. The revenue for the quarter ending June 2016, stood at Rs. 16,782 crores in comparison to Rs. 16.550 crores in the same quarter for last financial year.
While, the company reported the quarter-on-quarter fall of 4.5% in net profit. The net profit stood at Rs. 3,436 crores as against Rs. 3,597 crores in the last quarter. The company has cut the full year revenue guidance to 10.5-12% in the terms of constant currency. The decline in net profit can be justified by the rising employee cost which was valued at Rs. 9,282 crores this quarter, while it stood at Rs. 9,024 crores in the previous quarter. Also, the depreciation of Rs. 400 crores were added in the total expenditure. Other expenses of the company also increased almost 2.5 folds pulling the net profit down. The EPS and the PAT have been almost flat, marginally slipping. The EPS reported for last quarter was Rs. 15.74, while in the quarter under review, it stands at Rs. 15.03. PAT stood at Rs. 3,438 crores in the June quarter, as compared to Rs. 3,598 in the previous quarter.

Stock Strategy:

Infosys is at its eight months low level. The question that has been haunting the investors is what to do with the stock?
It is a sector that will be taking most heat from the Brexit. Its impact on global economy and corporate earnings is uncertain. Hence, it doesn’t hurt to be a little cautious in the space. The stock has been through the corrections and has been trading at an attractive valuation for those who want to hold on to the stock for long-term.
At CMP of Rs.1051.80 Infosys share price closed at a P/E of 17.58, the market cap of the company is 244061.86 crores.
Remember, large cap IT firms are not so promising for the near-future returns. So, those looking for some quick gains should refrain from Infosys and pay attention to the stocks repaying in short term basis. Infosys, at best, is a good defensive play, like other IT firms.