With two marquee deals in the past seven days and a possibility of upward revenue guidance for the third quarter, Infosys looks set to shrug off its poor run.
Earlier this week, India’s second largest software exporter said that it has bagged a four-year deal from Toyota to support the technology that the Japanese auto major uses to support its internal and external business functions.
According to a statement, the company will support supply chain, manufacturing, sales, after sales and customer service) and corporate functions that includes HR and finance, but did not put a value to the deal.
Similarly, in the same week, Infosys along with IBM won a deal from UK-based bank Williams & Glyn’s, a part of the Royal Bank of Scotland Group (RBSG), which was estimated to be around Rs 2,535 crore.
When contacted, Infosys officials did not disclose the size of the deal and said the company does not comment on client engagements.
An Infosys senior executive, on condition of anonymity, pointed out that more than the size of the deal, it is the value and the kind of engagement that it has with some of its recent wins that could act as a kind of benchmark for other competitors.
“Take the Williams & Glyn’s example – we are architecting the IT infrastructure that involves everything from core banking, mobile banking and a future wherein the bank can be operational without the need to have a physical branch,” said the senior executive. .
Also, analysts are expecting higher revenue guidance from the current 6-10 per cent growth for the 2014 fiscal year.
However, they are concerned about the predictability in revenues, which was once a hallmark of the company.
“While these two deals are a positive, it still does not give an indication of non-volatile revenue growth,” said Ankita Somani, IT & Telecom Analyst with Angel Broking.
A.K. Prabhakar, an IT analyst, formerly with Mumbai-based brokerage firm Anand Rathi, believes that with these deals, Infosys has started to close more deals since co-founder N.R. Narayana Murthy has come back at the helm.
Industry watchers also point out that the management is aggressively trying to shed off its slacker image.
“Companies like Infosys with their kind of success have found it hard to evolve organisationally and culturally when compared to some of their peers,” said Peter Schumacher, CEO, Value Leadership Group.