Analyst Meet

August 27, 2002

“Living up to the promise”

Living up to the promise

S. Gopalakrishnan

© 2002 Infosys Technologies Limited

 Analyst Meet
August 27, 2002

Agenda
■ Promises made, promises kept
■ Growth and profitability
■ Moving up the value chain
■ Expanding the service footprint
■ Executing new services uniquely
■ Presenting a one-stop-shop face to clients
■ A picture of the future…
■ Market opportunities
■ Organizational responses

© 2002 Infosys Technologies Limited Slide 2

 Analyst Meet
August 27, 2002

Profitable revenue growth

Revenue and Net Income* Margin

$700 35%
Millions

$636

$600 30%
$545

$500 25%

Net Income Margin

%
= 57
$414
$400 R 20%
CAG
Revenue

$300 15%

$203
$200 10%
$121
$100 $68 5%
$27 $40

$0 0%
1996 1997 1998 1999 2000 2001 2002 2003G
Fiscal Year ended March 31, Economic
Revenue Net Income*
Slowdown

* Excluding one-time stock compensation charge

© 2002 Infosys Technologies Limited Slide 3

 Analyst Meet
August 27, 2002

Understanding where the profits come from

Data from Q1 FY 2002-03

Onsite
salaries
Onsite 32
revenue Other income 3
Tax 6
53
Optg.
Gross Margin Net Income
Margin 30% 27%
45%
Offshore Other operating
costs 15 • S&M 7
revenue • G&A 8
47 Other direct 14 • ESOP Charge 1
• Depreciation 5
Offshore • Software 1
salaries 9
• Other direct 8

© 2002 Infosys Technologies Limited Slide 4

 Analyst Meet
August 27, 2002

Moving up the value chain

Prime Partner Status 4%

28%
Integrated Business-IT Roadmap

Enterprise Architecture Definition

96%

72%
Technology-enabled BPR

Enterprise App.
Solutions Dev. ITO SI
1998 Q1 2003
BPO
Maintenance
AD/M, R/E Others

Re-engineering
New services
have expanded
the addressable
1981 - 1996 1996 - 2001 2001
market by 3X
© 2002 Infosys Technologies Limited Slide 5
 Analyst Meet
August 27, 2002

Systematic expansion of footprint

■ A proven, defined methodology for introduction of
new services
■ New services are delivered uniquely
■ Alliances as a critical way to “stick to the knitting” while
presenting unified end-to-end face
■ Alliance partners are best in class, a true win-win relationship
model
■ Concentrate on what we do well
■ Aggressively use global delivery for win-win benefits
■ High quality client interface team presents these
services in an integrated fashion

© 2002 Infosys Technologies Limited Slide 6

 Analyst Meet
August 27, 2002

As a result, we have a unique position in the marketplace

What?
Strategy, consulting
Why? INFOSYS –
Organizational Value Add / Employee

proven GDM

Specialty
How ? IT services Global Majors –
new or no GDM

Most Offshore
Generic project
players
management

Implement
Support

Staffing Services

Source : Butler Group, Infosys

© 2002 Infosys Technologies Limited Slide 7

 Analyst Meet
August 27, 2002

A glimpse into the future…

■ Market conditions
■ Vendor consolidation – fewer, end-to-end service
providers
■ Large deals
■ Outsourcing becoming ubiquitous – changing role of
the CIO and his / her team
■ Global Delivery is a necessary condition
■ Managing risk (perceived and actual) is key

© 2002 Infosys Technologies Limited Slide 8

 Analyst Meet
August 27, 2002

…and our response…

■ Moving towards becoming an end-to-end player
■ Creating a “large deal” cross-functional team for
such opportunities
■ Working closely with outsourcing consultants to
build consensus for and thought leadership in
outsourcing
■ This also enables “sole-sourcing”
■ Aggressively leveraging GDM in all activities
■ Strong brand and financial stability reduces risk

© 2002 Infosys Technologies Limited Slide 9

 Analyst Meet
August 27, 2002

Summary : Industry Convergence

Who will win the race to the finish line?

• On-shore investments
• Brand building
Infosys : • Education and training
• Consulting mind-set Global Majors :
+ Talent magnet • Full-line of services
• On-shore hiring + Deep, hi-level client
+ High quality
relationships
execution
+ Readymade
+ Perfected Global
solution-sets
Delivery Model
• Offshore investments + Consulting
+ “Customer first”
• Reduce fat / shift C.G. mind-set
culture
• Re-allocate resources + Full set of services
+ Lean Orgn.
• Invest in processes
• Resolve orgn. issues
• Resolve bill-rate redn.

© 2002 Infosys Technologies Limited Slide 10

 Analyst Meet
August 27, 2002

“Living up to the promise”

Thank You

© 2002 Infosys Technologies Limited