N.R. Narayana Murthy’s return to Infosys as Executive Chairman is seen as a move to boost the IT major’s sagging fortunes.
The fall started in 2012, when it lost its second position in the domestic IT industry to Cognizant.
“He (Narayana Murthy) is an example of how to create value for all stakeholders, be it employees, clients or shareholders, employing best governance practices,” said Nirakar Pradhan, Chief Investment Officer, Future Generali Life.
Once a darling of the bourses, the Infosys scrip has been facing rough weather in recent times
Old magic
Raamdeo Agrawal, Joint Managing Director, Motilal Oswal Financial Services, said: “If there is something amiss in Infosys it is leadership. When icons leave, a vacuum is naturally created. Murthy’s return is good for the company as he knows the game very well. However, only time will tell if he can re-create his old magic.”
Experts feel that Infosys employees would be the biggest beneficiaries of this move.
Anup R. Gupta, Director, Sykes & Ray Equities, said: “Knowing Murthy’s passion for the company and his focus on corporate governance, it is natural for Infosys to receive fresh commitment from its employees. They needed someone like him to keep them motivated.”
Share price
“Ex-employees, who had quit after his departure, might also come back,” said Agrawal. Murthy’s ability to build a corporation as big as Infosys, coming from a humble background, is what would make the difference, said traders.
On Infosys’ share price movement on Monday, experts said a re-rating (upgrade of Infosys stock by research analysts to ‘buy’) was imminent due to this development. “Markets will open on Monday with a big salaam (salute). Short-sellers may stay away and I see no reason why the scrip should not move up significantly, perhaps towards the Rs 3,000-mark, ” said Agrawal.
On Friday, the Infy scrip closed at Rs 2,404, up 2.67 per cent on the NSE. On the BSE, it closed at Rs 2,408, up 2.79 per cent. Over 23.12 lakh shares changed hands on the NSE with a delivery percentage of 72. On the BSE, over 89,000 shares were traded with a delivery percentage of 40.76.