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Submitted in Partial Fulfillment of the Requirements of Bachelor of Business Administration Of Guru Govind Singh Indraprastha University
Submitted by: Name -Akshay Suresh Enrollment No.-12214201709 Semester-III-B(M) Jagannath International Management School Vasant Kunj, New Delhi – 70 _____________________________________________________________
This is to certify that Mr. Akshay Suresh student of BBA, “JIMS , New Delhi, has carried out project work on the topic of “INFOSYS” under my guidance . He has put in a lot of effort and hard work.
He has done good work with us I wish him all the best for bright future.
The completion of project report on “INFOSYS” has given me immense pleasure and knowledge. Obligations were heavy during my project work and it is a great pleasure to acknowledge deep sense of gratitude to my guide Ms. Neelam Dasgupta for her valuable guidance, advice, positive criticism, suggestion and constant encouragement throughout the project. I would also like to thank sincerely to my cousins and friends for their help and guidance during this task. Last but not least we are thankful to all of them who directly or indirectly helped us in computing this report successful
List of contents
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Introduction Company overview History Core Services Revenue Segments Key People Key competitors Key Clients Future Steps Financial Reports Latest Developments Analysis Goals References
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Infosys Technologies Limited
July 2, 1981
HEAD QUARTERS -
N.R.Narayana Murthy (chairman) Kris Gopalakrishna (CEO) & (Director)
com 6 .SERVICES .03.Information Technology consulting services & solutions REVENUE - US$3.905 (2009) WEBSITE - Infosys.16 billion (2009) EMPLOYEES - 1.16 billion (2009) NET INCOME - US$1.
Infosys China and Infosys Consulting are the Company's wholly owned subsidiaries. manufacturing. The Company provides end-to-end business solutions that leverage technology for its clients. and travel and tourism. Infosys Australia. As a result. package evaluation. 2007. incorporated on July 2. including consulting. The Company complements its service offerings with specialist support for clients using its domain competency group that has expertise in areas. is a global technology services firm that defines. banking and cash management.98% of the equity share capital of Infosys BPO as of March 31. It also uses its software engineering group and 7 . Infosys BPO (formerly Progeon Limited) is a majority owned subsidiary. energy and utilities. Infosys effectively holds 99. development. telecommunication. software re-engineering. insurance. retail and distribution. such as securities. maintenance. systems integration.Company Overview Infosys Technologies Limited (Infosys). supply chain management. design. healthcare. In June 2006. Infosys acquired the shares in Infosys BPO held by Citicorp International Finance Corporation (CIFC). 1981. and implementation and infrastructure management services. Infosys also provides software products to the banking industry. designs and delivers information technology (IT)-enabled business solutions to its clients.
it continually evaluates and trains its professionals in new technologies and methodologies.technology lab to create customized solutions for its clients. In addition. . 8 .
From a capital of US$ 250. we have catalyzed some of the major changes that have led to India's emergence as the global destination for software services talent. Our employee stock options program created some of India's first salaried millionaires. Narayana Murthy and a group of seven IT professionals in the year 1981 with an investment of $1000.R.000 employees. He emerged as the company's chairman and CEO and is regarded as a great manager because of his numerical abilities and Western style of management. we have grown to become a US$ 4 billion company with a market capitalization of approximately US$ 27 billion. 9 . We pioneered the Global Delivery Model and became the first IT Company from India to be listed on NASDAQ. It has created several firsts in Indian industry like being the first Indian company to be listed on NASDAQ in 1999 and the first to provide employee stock options plan (ESOP). Infosys Technologies Limited is a leader in software development and was co founded by N.HISTORY Established in 1981. In our journey of over 28 years. Infosys is a NASDAQ listed global consulting and IT services company with more than 105.
Infosys established its headquarters in Bangalore as there the workforces were not required to be unionized. In 2006 its revenue crossed $2 billion and it completed 25 years. and there was a huge potential for profit. had 900 employees and annual revenue of $20 million. It became a public limited company in 1992 and offered its IPO in three of the nine Indian exchanges in 1993. In 2003 it established subsidiaries in China and Australia. It received its ISO 2001 certification in 1993 and opened other development centers in India in 1995.The company opened its first international office in USA in 1987. The late 1990s was a time for exponential growth and the main reason for this was its offshore software development model. By 2000 its market capitalization was more than $20 billion. It opened its first European office in United Kingdom in 1996. benefits to the workforce were relatively a minor cost. By 1995 the firm was worth $200 million. 10 . In 2004 it crossed $1 billion in revenue.
• The Company's application development services span the entire range of mainframe. such as Java 2 Enterprise Edition (J2EE) and Linux 11 . Infosys creates new applications and enhances the functionality of its clients' existing software applications. The Company's projects vary in size and duration.NET or open platforms.Core Services Custom Application Development • The Company provides customized software solutions for its clients. client server and Internet technologies. An increasing proportion of Infosys' applications development engagements are related to emerging platforms. such as Microsoft's .
While Infosys performs most of the maintenance work at its global development centers using secure and redundant communication links to its client's systems. and are typically critical to a client's business. stability and preventive maintenance to avoid problems that typically arise from incomplete or short-term solutions. it also maintain a team at the client's facility to coordinate certain key interface and support functions Software Re-engineering The Company's software re-engineering services assist its clients in converting their existing IT systems to newer technologies and platforms developed by third-party vendors. and platform migrations. such as mainframe to client-server and client-server to Internet platforms. The Company focuses on long-term functionality. Infosys' re-engineering services include Web-enabling its clients' existing legacy systems. 12 . database migration. implementing product upgrades.Maintenance and Production Support Infosys provides maintenance services for its clients' large software systems that cover a range of technologies and businesses.
PeopleSoft. • The Company specializes in enterprise resource planning packages developed by vendors. Manugistics and Oracle. supply chain management packages developed by vendors. and enterprise application integration packages developed by vendors. business intelligence packages developed by vendors. customer relationship management packages developed by vendors. 13 . Retek and SAP.Package Evaluation and Implementation • Infosys assists its clients in the evaluation and implementation of software packages developed by third-party vendors. including Oracle. such as IBM and TIBCO. such as Business Objects and Cognos. including i2. including PeopleSoft (Vantive) and Siebel. It also provides training and support services in the course of their implementation.
which allows clients to evaluate emerging technologies and develop the standards and methodologies for applying those emerging technologies. IT infrastructure assessment. • Infosys offers IT consulting in the areas of migration planning. which includes assessing its clients' IT capabilities against existing and future business requirements and recommending appropriate technology infrastructure.Information Technology Consulting • The Company's IT consulting professionals assist its clients by providing technical advice in developing and recommending appropriate IT architecture. and technology roadmap • development. institution-wide implementation and overall project management involving multiple vendors under a common architecture. 14 . hardware and software specifications to deliver IT solutions designed to meet specific business and computing objectives.
The Company's service professionals are trained in test management tools from developers. performance benchmarking. test automation and product certification. systems integration. and operational and business process consulting. business process management. 15 . The Company offers end-to-end validation solutions and services. infrastructure management.Other Solutions • Infosys' service offerings including testing services. including enterprise test management. such as Mercury Interactive. engineering services. Infosys focuses on developing a framework for ongoing testing in order to seek continuous improvement in the predictability of its client's internal systems. IBM-Rational and Segue. • For each particular client.
helps banks by enabling them to shift their strategic and operational priorities. 150 million accounts.000users and supporting over 36 million peak banking transactions per day spread across multiple installations Finacle from infosys 16 .Finacle • Finacle®. 80. helping them serve over 100 million customers. the universal banking solution from Infosys. It maximizes their opportunities for growth .while minimizing the risks that come with large-scale business transformation • Finacle® currently powers 91 banks across 54 countries.
com/finacle/ Key industries 17 .Original author(s) Infosys Developer(s) infosys Initial release 1999 Stable release 3. 2009. 19 months ago Development status Active Written in Java Operating system Cross-platform Type Banking and financial suite License Q Public License Website http://www.06 / January 11.infosys.
Infosys serves various industries through its vertical business units. Distribution & CPG (RETL) Transportation & Services (TNS) Independent Validation Solutions (IVS) . • Real Estate 18 . such as: • • • • • • • • • • • Aerospace and Automobile (ANA) Banking & Capital Markets (BCM) Communication Service Providers (CSP) Resources.provides software testing services. Healthcare & Life Sciences (IHL) Media and Entertainment Product Lifecycle and Engineering Solutions (PLES) Retail. Energy & Utilities (REU) Hi Tech & Discrete Manufacturing (HTDM) Insurance. data centers and servers of clients. • IT Infrastructure Management Services (IMS) - manages core networks.
Middle East & Africa). which provides integration services to clients Revenue Segments 19 . such as EMEA (Europe. which specializes in ERP and package implementation and works with clients across industries and geographies and SI (Systems Integration). APAC (Asia-Pacific) and CAND (Canada).• Life science In addition to these. there are business units aligned to clients' geographies. There are also horizontal business units such as ES (Enterprise Solutions).
9 10.4 8.0 Industry Segmentation 20 .5 1.8 24.2 22.0 2004 71.2 1.2 19.7 100.7 9.Geography 2007 North Europe India Rest of the World Total America 63.3 26.4 1.0 2005 65.3 1.2 100.0 17.2 100.6 100.1 7.6 8.0 100.0 2006 64.0 2003 73.7 2.
2 7.0 10.5 16.8 3.3 4.6 and insurance Banking financial 30.5 13.6 3.4 12.2 25.3 3.5 11.5 3.2 12.1 4.2 15.8 5.7 23.2 100.3 2.0 2003 Testing 5.2 3.7 100.9 30.3 30.0 18.8 95.2 2.0 8.6 3.2 23.1 13.8 16.4 3.6 0.3 100.9 100.3 100.4 14.8 16.0 5.7 96.4 97.7 4.1 Development 29.0 20.2 14.0 9.9 2.1 10.3 managementand Engineering services service Other services Telecom Total services Retail Products Energy and utilities Total Transportation Others Total 9.7 4.5 Manufacturing 13.2 7.7 1.0 8.9 6.8 2.6 15.0 7.0 2.9 5.0 7.0 Service Offering 21 .8 16.9 14.2 2004 6.0 2.4 2.6 3.7 32.0 10.7 5.6 37.1 97.2 23.2 28.0 11.0 9.8 9.9 19.1 100.4 36.4 14.0 34.0 9.4 96.1 28.6 100.1 2006 4.5 Business process 1.0 Package implementation 6.5 25.0 11.2007 2006 2005 2004 2003 Services 21.5 100.2 Maintenance 17.7 2005 6.7 100.5 3.3 Banking financial service 37.5 100.6 36.9 5.4 Re-engineering 3.4 2007 2.6 Consulting 4.1 7.6 1.2 29.6 11.
Education & Research and Human Krishnaswamy. K. Mohandas 52 60 52 42 52 -48 1987 Co-Chairman of the Board 1981 Non-Executive Chairman of the Board and Chief Mentor 1987 Chief Executive Officer and Managing Director 1999 Chief Financial Officer 1997 Chief Operating Officer. Compliance Officer 1994 Director and Head . Quality & Productivity. T. S. Vibin Shibulal. Pai.Key People Nilekani. Bal Krishnan. Information Systems. D. Director 2006 Secretary. N. Parvatheesam. Dinesh Batni. Director 1996 Group Co Head . Director Trade Activity Trade Activity Trade Activity Trade Activity Trade Activity Trade Activity Trade Activity Trade Activity Trade Activity Key Competitors 22 . R. S. Srinath 52 52 Resources. Director 1996 Head .Administration.Communication Design Group. Narayana Gopalakrishnan. V. Murthy.World-wide Customer Delivery. Nandan M.
Tata Consultancy Services and Wipro • Consulting firms as Accenture . Satyam Computer Services.CSC Key Clients 23 . Cap Gemini • IT Outsourcing firms such as EDS .• Offshore Technology services firms such as Cognizant Technologies.
ABN AMRO AIRBUS AETNA INC 24 .
GOLDMAN SACHS During fiscal 2007.0% revenues came from repeat business from existing clients 25 .3% of revenues came as repeat business and during 2006. 95. 95.
In BPO as well. We expect greater focus ahead in this area. Infosys has developed ~50 solution based offerings in the IT services space and believes that some of these can help break the linearity between revenue and manpower growth in the business. More keen on large deals. Increased focus on solution based offerings in both IT services and BPO. mentioned that a dedicated team was now working on large deals. However. 26 . its first platform based BPO offering is likely to be launched soon. it is possible to improve margins later in the life of the contract through reduced G&A overheads.FUTURE STEPS 1. Infosys. 2. while the initial margin profile can be extremely wavy. in its recent analyst meet. The margin dilution from large deals has been a point of concern in the past at Infosys.
While TCS had made such a payment in the case of Pearl BPO earlier.3. 27 . Willingness to explore new deal structures. The market was surprised when Infosys paid an upfront $28m for the $250m/7-year Phillips BPO deal. Infosys’ willingness to do so was certainly a shift from the past.
Company Strategy for future • Increase businesses from existing and new clients • Expand geographically • Continue to develop deep industry knowledge • Enhance brand visibility • Pursue alliance and strategic acquisitions • Continue to invest in infrastructure and employees 28 .
29 . However.Infosys's hiring plans for the year (2009): Most of the companies rapidly cutting their losses by employing massive retrenchment drive. there are still some companies that are looking to hire skilled candidates. The company intends to stick to its plan of hiring 25. despite the massive economic turmoil across the globe.000 people this fiscal year. One of these companies is Infosys. firing thousands of employees or offering them early separation schemes.
" said Dheeshjith V G. Around 20-25 percent of the total business in Infosys' Mexico subsidiary comes from 30 . Head. "We are looking for some very targeted acquisition with specific criteria. New Markets and services. The company's first centre will be operational in Brazil in next three to four months. INFOSYS Infosys had started focusing on Mexican market in last six to seven months.Infosys plans acquisitions in Brazil and Mexico (JUNE 16. 2009) Infosys is trying to acquire a few companies in Mexico and Brazil to expand its delivery capabilities. According to Dheeshjith there has been increase in the business from local clients and some companies are looking to outsource large deals. Infosys has currently employed about 250 people in Mexico and hence feels the need to have local facility to attract local business.
multinational companies that have operations in Mexico while the rest of the business comes from clients in North America. That is the reason why Infosys is stressing on local deals to attract local customers. 31 .
) 1-Year Sales Growth 2007 Net Income (mil.Financial Report Key Numbers 2007 Sales (mil.200 37.) 1-Year Net Income Growth 2007 Employees 1-Year Employee Growth $3.2% 72.6% $850.0% Financials &Stock Performance FINANCIAL HIGHLIGHTS Fiscal Year Fiscal Year Ends: Most Recent Quarter (mrq): 31-Mar 30-Jun-07 32 .0 53.090.0 43.
00M 1.36B 6.60% 1.13% 21.96% 27.05B 939.37% 39.31B 1.01 40.10% 33 .Profitability Profit Margin (ttm): Operating Margin (ttm): Management Effectiveness Return on Assets (ttm): Return on Equity (ttm): Income Statement Revenue (ttm): Revenue Per Share (ttm): Qtrly Revenue Growth (yoy): Gross Profit (ttm): EBITDA (ttm): Net Income Avl to Common (ttm): Diluted EPS (ttm): Qtrly Earnings Growth (yoy): 27.37% 3.65 51.
33 1.302 5.59B 2.02B 240.Balance Sheet Total Cash (mrq): Total Cash Per Share (mrq): Total Debt (mrq): Total Debt/Equity (mrq): Current Ratio (mrq): Book Value Per Share (mrq): Cash Flow Statement Operating Cash Flow (ttm): Levered Free Cash Flow (ttm): 1.50M 34 .778 0 N/A 6.
Profile . Research) on Wednesday and bought three of the Dutch firm's back-office centres to extend its presence in Europe.BO) signed a $250 million outsourcing contract with Royal Philips Electronics (PHG. management and maintenance of railway operations of Canadian Pacific.AS: Quote.Latest Developments • NASDAQ-listed Infosys (INFY.O) will provide services like application development. which operates a 13.500-mile (21. a company statement said • Infosys Technologies Ltd. 35 . (INFY.700kilometre) transcontinental railway.
36 . One of the good steps Infy has taken to this regard was by opening its Bhubaneswar center. Another good example is Gandhinagar where a Patni computer was one of the first big IT companies to open its office.Analysis Key challenges faced by Infosys are : • Rise in Wage levels on Indian IT workers. Infy can overcome this risk by growing up the value chain so that it can afford to increase its billing rates and still add value to its customers .Second thing it can do is to move their operations to second level cities in India that have low cost of living and where wage pressure is less. Its cost of living is way less than that of Bangalore.
In order to continue this pace the company needs to invest a large amount of capital in building new facilities. Its 2006 revenues had 12.5% revenues generated from India. Infy would face challenges in controlling its capital expenditures towards expanding its facilities 37 . With recent surge in real estate prices in India. • Rise in Infrastructure costs Infy's 2006 capital expenses was $246mn compared to that of $185mn in 2005. Infy should grow its client base in India and China where the impact of foreign exchange is negligent. With the present Indian IT market valued at $5bn (obtained from TCS's 2006 annual report) and expected to grow at 11%. TCS is a good example with this regard.• Change in exchange rates. Infy has scope of getting a good market share. This is around $300 mn. This is an increase of over 30%.
This increases the lead time required to acquire a company. 38 .Another way can be employing virtual classroom techniques by which a person sitting in India can get US experience that he would otherwise get by being physically present in USA.• Inability to acquire foreign companies The present Reserve Bank of India guidelines state that in ceratin cases Indian companies have to take the central bank's permission to acquire a foreign company. • Backlash towards outsourcing in foreign countries One way is to employ local talent. Multinational companies like Accenture are doing a great job in this front and are not so much dependent on wok visas as the Indian companies like Infy.
• Present Tax benefits are limited till 2009 Most Indian IT companies are enjoying a tax holiday which exempts them from taxes on exports performed from designated export promotion zones.But this benefit is only applicable till fiscal 2009. After that the Indian IT companies would be taxed the same way as other Indian companies 39 . This helps Indian IT companies to reduce their tax rate .
restructure their cost base. Proven global delivery model: Highly evolved Global Delivery Model represents a key competitive advantage. They’re able to capture a greater share of our clients’ technology budgets.SWOT ANALYSIS STRENGTHS Leadership in sophisticated solutions that enable clients to optimize the efficiency of their business: The company bring together expertise in consulting. and help them achieve greater success through shifting business cycles. create better value for their end customers and become more competitive. they have developed our onsite and 40 . Over the past decade. Expertise helps our clients improve their own efficiencies. IT services and business process outsourcing to create solutions that allow clients to increase their customer loyalty through faster innovation.
offshore execution capabilities to deliver high quality and scalable services. and have refined our Global Delivery Model to effectively integrate onsite and offshore technology services. Commitment to superior quality and process execution: Infosys have developed a sophisticated project management methodology to ensure timely. Infosys have made substantial investments in processes. infrastructure and systems. high quality solutions in reduced time frames enabling them to achieve operating efficiencies. Strong Brand and Long-Standing Client Relationships: They have long-standing relationships with large multinational corporations built on successful prior engagements with them. The Global Delivery Model provides clients with seamless. 41 . consistent and accurate delivery of superior quality solutions to maintain a high level of client satisfaction. In doing so.
We currently have 52 global development centers. 42 . Innovation and leadership: A pioneer in the technology services industry. which has enhanced our reputation in the marketplace.Status as an employer of choice: Infosys has among the best talent in the Indian technology services industry and are committed to remaining among the industry’s leading employers. Ability to scale: Infosys have successfully managed their growth by investing in infrastructure and by rapidly recruiting. training and deploying new professionals. We have a diverse workforce which includes employees from 70 nationalities. We have a presence in 13 cities in India. allowing us to recruit technology professionals with specific geographic preferences. We are one of the first Indian companies to achieve a number of significant milestones.
Revenues are highly dependent upon a small number of clients. Europe or these industries may affect our business.WEAKNESSES Revenues and expenses are difficult to predict and can vary significantly from period to period. as well as on clients concentrated in certain industries. which could lead to clients discontinuing their work. The economic environment. pricing pressure and rising wages in India and overseas could negatively impact revenues and operating results. which could cause share Price to decline 26 May not be able to sustain our previous profit margins or levels of profitability. and the loss of any one of our major clients could significantly impact the business 43 . Any inability to manage growth could disrupt our business and reduce our profitability may face difficulties in providing end-to-end business solutions for our clients. Economic slowdowns or factors that affect the economic health of the United States. Revenues are highly dependent on clients primarily located in the United States and Europe.
Failure to complete fixed-price. fixed-time frame contracts within budget and on time may negatively affect our profitability client contracts can typically be terminated without cause and with little or no notice or penalty. which could negatively impact our revenues and profitability The engagements with customers are singular in nature and do not necessarily provide for subsequent engagements OPPORTUNITIES Huge untapped potential for in the global market as IT will become the need of almost every industry The IT industry can be the reason for India being a global leader of tomorrow 44 .
which could reduce the share of business from clients and decrease the company’s revenues Our client contracts are often conditioned upon our performance. 45 .THREATS Legislation in certain of the countries. including the United States and the United Kingdom. could result in lower future revenues and profitability under the contract. in which Infosys operates. if triggered. which. could result in less revenue than previously anticipated Some of our long-term client contracts contain benchmarking provisions which. if unsatisfactory. may restrict companies in those countries from outsourcing work overseas Intense competition in the market for technology services could affect cost advantages.
Goals INITIAL GOALS They started off with one client and right from the beginning understood the concept of an offshore delivery model. all without being constrained by national boundaries. We were careful never to compromise on that despite many challenges. 46 . Conceptually. Infosys believed that the key to success is to ensure that it executes our engagements well every time. they tried to leverage globalization for customized software development . We have based our whole operation on a foundation of strong value systems.producing where it is most cost-effective. and selling where it is most profitable.
47 . Status-It was achieved by providing sustainability training for seniors PRODUCT RESPONSIBILITY Sustain customer satisfaction in the annual customer survey Status.It was achieved. Status.This was achieved by implementing new monitor mechanisms Reduce per capita energy consumption by 5 %.PRESENT GOALS OF INFOSYS AREA OF GOVERNANCE To define and implement a training module and create awareness about sustainability. the overall customer satisfaction was at 81 % ENERGY Monitor energy consumption to become energy efficient.
developed a basic training module on human rights which will be implemented in 2010.This was partially achieved by reducing the per capita electricity consumption to 10%.000 trees in Mangalore. HUMAN RIGHTS Create a framework for employees.Below the target – planted 16.Below target. 48 . ENVIRONMENT Plant a tree for every new employee Status.Status. EMPLOYEE ENGAGEMENT Track impact of employee health related activities. suppliers and vendors to be educated on human rights. Status.
Target achieved by receiving feedbacks after health check ups. StatusAchieved target by developing guidelines and dashboards. FUTURE GOALS OF INFOSYS FOR THE YEAR 20092010 STRATEGIC LEVEL 49 .Status. SOCIETY Define and implement metrics for measurement.
Strive to meet stringent short term goals. global deals 4. To educate vendors on our green procurement policies. To create Large.1. We will develop processes to integrate business and sustainability goals. 2. Continued linear relationship between revenuemanpower 50 . water and carbon foot print. 3. 3. 2. OPERATIONAL LEVEL 1. Improve accountability in the business units through iSOP framework. 5% reduction in energy.
References Websites: • Infosys.To implement Enterprise scale Solution Design and Integration as key focus areas in the telecom sectors.com 51 .com • Google.
• Scribd.com 52 .com • Bing.
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