Vishal Sikka, on Friday, resigned as Infosys Ltd.’s chief executive officer and managing director. Sikka’s three-year term came to an end after a protracted war of words between co-founder Narayana Murthy and the new management, that has played out in the media over the past year.
While announcing his decision to step down, Sikka said the company has achieved much over the last three years, but ‘distractions’ have undermined the good work done.
BloombergQuint looks back at the performance of the company and its shares since Sikka took over on August 1, 2014.
Infosys Shares Ahead Of IT Index
Shares of Infosys have given higher returns compared to the Nifty IT index and also some of its peers, such as Tata Consultancy Services Ltd. and Wipro Ltd., over the period that Sikka has been CEO. While HCL Technologies Ltd. has seen the best performance on the stock markets over this three year period, Infosys comes a close second with a gain on over 13 percent in its share price. The stock slumped on Friday after news of the resignation.
Double-Digit Annual Revenue Growth
Infosys’ annual revenues (in rupee terms) grew at a compounded annual growth rate of 11 percent over the period that Sikka was CEO. Sikka, in his resignation letter, said that he joined Infosys to help it navigate through a “massive transformation opportunity.”
“I came to do this with the power of technology, given my experiences with similar transformations, my background in artificial intelligence, and the structural changes that I saw happening in the IT services industry,” Sikka wrote.
Profit Growth In Tandem With Revenues
Sikka also said that he intended to restore strong profitable growth at the company. Over his tenure, the company’s profit grew at a compounded annual growth rate of 10.5 percent. Margins have improved slightly from 23.9 percent in fiscal 2014 to 24.7 percent in fiscal 2017.
Strong Cash Reserves
The level of cash and equivalents, along with short-term investments, was maintained at above Rs 30,000 crore. The high cash on the balancesheet had, in fact, become a contentious issue between the co-promoters and the management. The promoters had demanded that the company return some of the excess cash to shareholders. The Infosys board is due to meet and consider a buyback on Saturday.