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Infosys Technologies
Infosys expanding operations in SEZs
Posted by :
Infy_fan_alwaysTracked by: 0 Boarder
Bangalore-based software services major Infosys Technologies Ltd is expanding its operations in the country’s special economic zones (SEZ) to take advantage of tax incentives, a top official said here Wednesday.
All our incremental expansions are happening in SEZs as the tax incentives for units located in software technology parks is expected to go soon, Infosys chief executive and managing director S. Gopalakrishnan told reporters.
According to him, out of Rs.11 billion (5.8 million) budgeted for expansions, nearly Rs.10 billion is being spent on setting up centres in SEZs in cities like Chennai, Chandigarh, Jaipur, Hyderabad, Mangalore and Thiruvananthapuram.
In Chennai, Infosys is expanding its unit inside Mahindra World City SEZ.
We have 129 acres and we can build facilities to have 35,000 seats in phases. The first phase will get over soon and will have 11,200 seats. In the second phase, we will add 5,000 more seats company director T.V. Mohandas Pai said.
Referring to the slowdown in the IT sector, Gopalakrishnan said:
The opportunities are increasing. Though bulk of the business is from North America and Europe, the market is not saturated. The slowdown throws up new service opportunities
Though the US accounts for 56 percent of the company’s revenue, Infosys is not dependent on any single economy, said S.D. Shibulal, chief operating officer of Infosys.
The industry risk is diversified, he added.
Riding on high growth, Infosys is planning to expand business in emerging economies like China, Eastern Europe and Mexico.
Pai said the company would hire 25,000 people this year.
We have issued 2,800 offer letters to fresh graduates this fiscal and they will join next year. The offer acceptance rate is around 78 percent, which is in line with the industry norms, he said.
Asked about the company\\\\\\`s hedging practice to meet the risk of currency fluctuation, Pai said Currency fluctuation is a fact of life. Having said that, we do short term hedging and not long term. We do not speculate.
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Buy Infosys, target of Rs 2250: Karvy
Posted by : GuestTracked by: 0 Boarder
Excellent analysis , I wish you were in Infosys board.. somebody please tell Infy that the deal is a waste, atleast they can save some money if they come to know now
:)...
In reply to:
Buy Infosys, target of Rs 2250: Karvy
Posted by : Guest
Exit infosys, the deal is waste of money for short to medium term. Buy infy for 4-5 years of time frame. Profit booking or exit seen in Infy. Buy at 1400. Lower target of Rs. 1200. Deal to have burden over balance sheet. 
Buy Infosys, target of Rs 2250: Karvy
Posted by : GuestTracked by: 0 Boarder
Exit infosys, the deal is waste of money for short to medium term. Buy infy for 4-5 years of time frame. Profit booking or exit seen in Infy. Buy at 1400. Lower target of Rs. 1200. Deal to have burden over balance sheet....
In reply to:
Buy Infosys, target of Rs 2250: Karvy
Posted by : MMB Messenger
Karvy Stocking Broking has maintained its buy rating on Infosys Technologies with a target price of Rs 2250. The resultant acquisition is not going to lead to any boost in earnings, and the company would end up report an earnings of Rs 102 for FY09 and Rs 130 for FY10.
Buy Infosys, target of Rs 2250: Karvy
Posted by : MMB MessengerTracked by: 0 Boarder
Karvy Stocking Broking has maintained its buy rating on Infosys Technologies with a target price of Rs 2250. The resultant acquisition is not going to lead to any boost in earnings, and the company would end up report an earnings of Rs 102 for FY09 and Rs 130 for FY10....
Accumulate Infy
Posted by : GuestTracked by: 0 Boarder
Accumulate Infy as it nears downside at Rs.1400. Good stock from 4-5 years of point of view. Much of the glitter has been done. Now accumulation should be on the way....
infosys to appreciate...
Posted by : cdfdTracked by: 0 Boarder
that infosys would target around 2000 is shared by 4 reputed brokerages as against 1 who targets it at 1710.....
it looks attractive as a hold now and a buy at lower levels.......
infy at 7000
Posted by :
achsTracked by: 0 Boarder
when was infy at 7000 ...
Today is a day of INFOSYS.
Posted by : GuestTracked by: 0 Boarder
Will Infy touch 1825 Today ..?...
Infy may not fall below 1500 in 2008....
Posted by : marketmanTracked by: 0 Boarder
Axon deal could be positive for infy over the long term.... the company is concentrating on global expansions in difficult times.... this deal may counter the effect of US slowdown for some extent.... topline as well as bottomline figure will be protected with this acquisition,in this fiscal.......
In reply to:
Infy may not fall below 1500 in 2008....
Posted by : marketman
With this Axon bought out deal,infy is looking to expand globally in aggressive manner....
Though the acquisitions in tech sector may not be excited by market participants,with this deal infy may comfortably increase its market share in european continent.... similar bought out deals will be expected in coming future from the company....
Now the analysts expecting that the scrip may not fall below 1500 in the near term.... so the short term downward risk is just 10% from present price levels....
Infosys to get inducement fee if Axon bid
Posted by :
sankarantprTracked by: 0 Boarder
Infosys has agreed to buy out Axon Global Plc of the UK before calendar 2008 is over. But, as in all international acquisition attempts, what if another company is willing to better Infosys’ offer of 600 pence per Axon share?
Should Axon shareholders vote in favour of another buyer and that deal be completed before January 31, 2009, Axon would pay Infosys an inducement fee of one per cent of the consideration payable by Infosys for the Axon shares, the two companies have said in a statement, put up at the Indian major’s Web site.
This fee would amount to approximately Rs 33 crore, given Rs 3,310 crore as the size of the acquisition.
To close deal by Nov
However, Infosys has said it expects to complete the deal with Axon in November 2008.
Asked if Infosys is competing with any other company for Axon, Infosys CFO, Mr V. Balakrishnan said, “We had made an offer and it is public. We are not aware of anybody else competing for Axon at this point in time.”
Currently, Infosys has irrevocable undertakings from Axon’s key shareholders to vote in favour of Infosys’ proposal, in respect of about 11.65 million shares representing about 18.1 per cent of the shareholding.
Promoters back deal
Three key promoters of Axon, Mr Mark Hunter, Mr Donald Kirkwood and Mr Paul Manweiler, hold stakes totaling about 17.9 per cent of the above.
Axon’s annual report for calendar 2007 shows at least nine institutional shareholders whose individual stakes exceed 3 per cent and whose cumulative holding touches 42.3 per cent of the shareholding.
Results
Axon also announced today a 28 per cent rise in half-year revenues to £123.9 million (£96.7 million) for the period ended June 2008, while operating profit rose 19 per cent to £16.5 million pounds (£13.8 million) for the same period.
Overlap
Since both Infosys and Axon compete in similar geographies and service offerings, overlap of operations is unavoidable. Asked if that was a cause for concern, Mr Balakrishnan told Business Line, “The client list is more complementary. We have very few clients which are common and that’s a great opportunity to cross-sell."
India story
Significantly, the India story seems to be forcing consolidation among niche or smaller players even internationally. In its announcement, Axon has said that competition from large global IT service providers and the uncertainty in the macroeconomic environment were among the reasons that prompted Axon to be acquired by Infosys.
It added that the emergence of overseas new entrants, in recent years, with significant ‘structural’ advantages has posed an increasing competitive threat to European and US service providers. In other words, offshoring capability is a differentiator.
Source-Businessline...
Mixed views on Infosys-Axon deal
Posted by : Infy_fan_alwaysTracked by: 0 Boarder
You look at EPS not only from a short term perspective, probably for a short term it makes sense to buy back like you said.
But here the objective is that Infy want\\`s to grow and it has a vision to be a global leader. For that it just cannot manage with the low margin outsourced works.This is the reason for Infy focussing on \\`Software Products\\` as well us for opening up consulting.
With this acquisition , the combined entity will be very stong in SAP consulting. More than the revenue from Axon , what Infy will be getting is the client base. Say, If there was a client who gave Axon a project worth 10 million and now Infy has a world of products to be offered to the same client. This will bring in a huge difference and this is the advantage of the synergy of the new merged entity....
In reply to:
Mixed views on Infosys-Axon deal
Posted by :
diliphm
I do not understand why Tata Motors and now Infosys are buying these white elephants. If cash is king in todays conditions, they should keep it with themselves. If that makes them uneasy, they can buy back their own shares to improve EPS.
Mixed views on Infosys-Axon deal
Posted by : diliphmTracked by: 0 Boarder
I do not understand why Tata Motors and now Infosys are buying these white elephants. If cash is king in todays conditions, they should keep it with themselves. If that makes them uneasy, they can buy back their own shares to improve EPS....
In reply to:
Mixed views on Infosys-Axon deal
Posted by : Infy_fan_always
Though Infosys-Axon deal is being hailed as the largest outbound acquisition by an Indian IT company, some market participants believe it will have no major financial impact on the IT bellwether.
They agree that this is a strategic buy in the consulting and package implementation space, but express concern on any sharp appreciation in the rupee against various currencies and a prolonged recession in major user economies.
The announcement of the Axon buy did little for Infosys ADR on Monday and it ended down 4 per cent at .90 on the Nasdaq, trailing the weakness in US markets.
Infosys announced acquiring UK-based Axon Group in a 407-million pound (Rs 3,310 crore) all-cash deal after market hours Monday. The deal is expected to be consummated by November 2008, with the payment being made in December, and would add to its earnings from January 2009, Infosys said.
Infosys shares looked up at start Tuesday on the back of the news and a slide in the rupee to a 17-month low against the dollar. But the stock ended off the days high on account of profit booking.
Infosys proposed take over of Axon Group may be a tad expensive, and not exactly be a value buy, but it is a better investment than making cash sit idle in your balance sheet. This should essentially take the pressure off the management and give them the elbow room to now look at better fitting plays, something that they had been avoiding so far, said Anagram Stock Broking.
However, the broking house is worried that the Eurozone may face more slowdown than the US. Hence, investing in a company that draws majority of its earnings from the zone may not be a very good buy.
Kotak Securities believes Axon is a strategic fit for Infosys, which has been consistently looking to expand its consulting and package implementation capabilities and its presence in Europe.
Kotak has maintained a buy on the stock for a target of Rs 2,027 and is certain that the deal will allow Infosys to gain in terms of acquisition of marquee customers, wider reach, improved transformational capabilities and incremental abilities to bid for larger deals.
Infosys values Axon at nearly 2 times CY07 revenues and about 20 times CY07 earnings, which is fair in our view. Axons revenues and PAT have grown by 43% and 68% CAGR, respectively over the past 5 years, albeit partly due to acquisitions, said the broking house.
Mixed views on Infosys-Axon deal
Posted by : Infy_fan_alwaysTracked by: 0 Boarder
Though Infosys-Axon deal is being hailed as the largest outbound acquisition by an Indian IT company, some market participants believe it will have no major financial impact on the IT bellwether.
They agree that this is a strategic buy in the consulting and package implementation space, but express concern on any sharp appreciation in the rupee against various currencies and a prolonged recession in major user economies.
The announcement of the Axon buy did little for Infosys ADR on Monday and it ended down 4 per cent at .90 on the Nasdaq, trailing the weakness in US markets.
Infosys announced acquiring UK-based Axon Group in a 407-million pound (Rs 3,310 crore) all-cash deal after market hours Monday. The deal is expected to be consummated by November 2008, with the payment being made in December, and would add to its earnings from January 2009, Infosys said.
Infosys shares looked up at start Tuesday on the back of the news and a slide in the rupee to a 17-month low against the dollar. But the stock ended off the days high on account of profit booking.
Infosys proposed take over of Axon Group may be a tad expensive, and not exactly be a value buy, but it is a better investment than making cash sit idle in your balance sheet. This should essentially take the pressure off the management and give them the elbow room to now look at better fitting plays, something that they had been avoiding so far, said Anagram Stock Broking.
However, the broking house is worried that the Eurozone may face more slowdown than the US. Hence, investing in a company that draws majority of its earnings from the zone may not be a very good buy.
Kotak Securities believes Axon is a strategic fit for Infosys, which has been consistently looking to expand its consulting and package implementation capabilities and its presence in Europe.
Kotak has maintained a buy on the stock for a target of Rs 2,027 and is certain that the deal will allow Infosys to gain in terms of acquisition of marquee customers, wider reach, improved transformational capabilities and incremental abilities to bid for larger deals.
Infosys values Axon at nearly 2 times CY07 revenues and about 20 times CY07 earnings, which is fair in our view. Axons revenues and PAT have grown by 43% and 68% CAGR, respectively over the past 5 years, albeit partly due to acquisitions, said the broking house.
...
Infosys opens the doors of Europe
Posted by : Infy_fan_alwaysTracked by: 0 Boarder
Directed at a high price, the acquisition of Axon Group, a service company specializing in SAP consultancy, will primarily enable Infosys to strengthen its presence in Europe, a strategic target at a time when the U.S. economy slows down. But this is far from being the sole interest in this record breaking transaction for an Indian IT company.
It is a record so far: no Indian IT company has had the luxury of an acquisition in the West for such a huge amount; nearly 510 million euros. This high price represents twice the revenue of Axon Group, and 20 times its profit in 2007. But for Infosys, the acquisition of Axon Group, a british IT company specializing in SAP consultency, has multiple interests.
The Indian investors got it right: in the stock market in Mumbai, which opened down 1.1% this Tuesday, August 26, Infosys shares gained 1.3% to 1,725 Rs. Harit Shah, an analyst with Angel Broking broker, quoted by Reuters, considers that \\`this acquisition seems to be very good in the long term. It will accelerate [Infosys] growth in Europe and give it access to a very good customer portfolio.\\` As a result, more than an expenditure, the operation is analysed as a smart use - with good prospects for return on investment – of part of the pile of available cash that Infosys is seated on.
Grow faster in Europe
On average, since 2007, North Amercia accounts for about 61% of Infosys revenue, compared to about 27% for Europe. The Indian IT company made no secret of its interest in the Old Continent: it intends to produce, ultimately, 40% of its revenue over there, and bring along North America to the same ratio. In late July, we met Kris Gopalakrishnan, Infosys CEO, in Bangalore. On the occasion of an interview, while the acquisition of Axon was not yet known, he discussed the challenges of conquering the European market and the strategy adopted by the Indian IT company .
...
Axon shares jump after Infosys offer; counterbid predicted
Posted by : Infy_fan_alwaysTracked by: 0 Boarder
Shares in the British consultancy group Axon jumped by 20.1 percent Tuesday fuelling speculation about a counterbid to Infosys Technologies 407 million pound ($800 million) offer to buy the company.
The all-cash offer by the Indian IT major, unanimously recommended by the board of the Surrey-based company, represents a value of 600 pence per share.
But Jonathan Imlah of Altium Securities said in a note, -Axon is a global leader in its field. We believe there is room for a counterbid closer to 700 pence a share.
Axon chairman Roy Merritt said Monday, Against the background of the global economic environment and increasing consolidation in the IT services industry the combination with Infosys represents a compelling proposition.
The offer from Infosys represents an attractive cash premium and provides certainty of value today for Axon shareholders. We are therefore unanimously recommending the offer to shareholders.
Speculation mounted as Axon, a global leader in the delivery of business transformation programmes for organisations that use software manufactured by the German company SAP, said Tuesday profits were up 23 percent in interim first half results.
Revenue was up 28 percent to 123.9 million pounds and adjusted operating profit up 23 percent to 20.2 million pounds compared to H1 2007, the company said.
Despite what analysts said, Axion told shareholders Tuesday: Infosys announced yesterday a recommended offer to acquire Axon Group to be implemented by way of a Scheme of Arrangement. Under the terms of the acquisition, Axon shareholders will receive for each Axon Share 600 pence including the interim dividend of 2.25 pence announced by Axon today.ā€¯
Axon was set up in 1994 by Mark Hunter, who left his job with SAP to bring together a team of IT specialists. Hunter will get 44 million pounds as part of the Infosys offer, reports said.
Axon was floated in 1999 and today generates more than 200 million pounds a year. Its major clients include Barclays, Xerox, British Petroleum, Pratt & Whitney, Sikorsky, Goodrich Corporation, Air Canada, Microsoft, Kraft Foods and Aquarion as well as public sector clients such as Transport for London and Wolverhampton City Council.
It employs 2,000 staff in Egham, Surrey, and has been growing through acquisitions in the US. Last month it bought Australias Consulting Principles for A$3.45 million.
The Infosys buyout is being interpreted in Britain as reflecting a bid by Indian companies to move up the value chain from providers of low-cost services based on cheap labour.
As they have grown, they have also begun attempting larger acquisitions, with some moving towards offering higher margin consulting services,one newspaper commentator said.
Wipro, India's third largest software exporter, bought US technology firm and infrastructure management firm Infocrossing for $600 million last year.
Infosys has also been looking west to increase revenue in order to better compete with its main Indian rival, Tata Consultancy Services.
A source close to the deal was quoted saying the transaction was a good fit. SAP requires a real skill-set and even though Infosys already operates in the sector, for a first piece of larger M&A, Axon gives them a great leg-up, he said.
Infosys and Axon are among two dozen companies worldwide that implement back-office software systems designed by SAP.
The Indian company provides consultancy services for a number of IT platforms, and is understood to want Axon because of its position as a higher-end consultancy, able to generate higher margins by offering after-sales service, such as maintenance assistance.
Infosys chief executive Kris Gopalakrishnan said there was a strong demand for SAP systems, with Infosys registering a 62 percent increase in orders in the past year.
He added that the deal would allow Infosys to compete more effectively on the international stage with rivals such as Accenture, Oracle and Capgemini.
Our rationale was that with this acquisition, our global reach, scale and our ability to participate in large transformational deals would be significantly enhanced,he said.
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