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Infosys Technologies
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.
...
Infy : Indian rupee falls beyond 44 level against US dollar
Posted by : Infy_fan_alwaysTracked by: 0 Boarder
The Indian rupee fell sharply against the US dollar in opening deals on Tuesday. At about 11:40 pm ET, the rupee touched 44.1350 against the US dollar, which set a lowest point for the former since April 05, 2007.
On the downside, the rupee may likely target the 44.6350 level against the buck. The dollar-rupee pair closed Monday\\`s deals at 43.6900. ...
Infy stock to go up
Posted by : IT_BullsTracked by: 0 Boarder
US Dollar is at Rs 44.10 now...buy Infy and TCS....
In reply to:
Infy stock to go up
Posted by :
rajivksh
It is difficult of see how infosys can turn this company into a 30% operating margin level.
Infosys mgmt has not demonstrated such wonders in the past and only time can tell their strength in this area.
My opinion is that it will take time to be fruitful. Murthy and Nandan must have taken a really long term view. The key gain is the clients not the people of Axon. Axon have over 70 customers in Non-US geographies and I believe it is strength.
Axon agrees 600p Infosys bid
Posted by : Infy_fan_alwaysTracked by: 0 Boarder
Business services software specialist Axon has agreed a 600p, £407m, takeover from Indian outsource group Infosys.
The bid, a 19.4% premium to Friday\\`s price, has been accepted by 18.1% of Axon\\`s shareholders including founders Mark Hunter, Donald Kirkwood and Paul Manweiler.
\\`Against the background of the global economic environment and increasing consolidation in the IT services industry the combination with Infosys represents a compelling proposition,\\` chairman Roy Merritt said.
Axon\\`s interim results, published today, showed revenue up 28% to £123.9m (H1 2007: £96.7m)with pre-tax profits of £16.3m against £13.4m.
There is an interim dividend of 2.25p, which is in addition to the 600p offered by Infosys. ...
www.multibaggerstockadvisor.blogspot.com
Posted by : GuestTracked by: 0 Boarder
infosys is the so called blue chip but its hard to trade in it sector so we need to associate to some expertise service as found on the leenk above to trade in such sector...
Down with the Acquisition !
Posted by : Infy_fan_alwaysTracked by: 0 Boarder
Merrill Lynch has maintained neutral rating on Infosys, with a target of Rs 2000...
In reply to:
Down with the Acquisition !
Posted by : Infy_fan_always
Morgan Stanley has maintained equal weight rating on Infosys, with a target of Rs 1900
Down with the Acquisition !
Posted by : Infy_fan_alwaysTracked by: 0 Boarder
Morgan Stanley has maintained equal weight rating on Infosys, with a target of Rs 1900...
In reply to:
Down with the Acquisition !
Posted by : Infy_fan_always
Dear all!
Stop creating unnecessary hype to the Axon acquisition.
What is more important is the company’s perspective and its attitude to be a true global leader.
* The recent initiative taken to reduce US dependency and increase other market penetration.
* All new 'Ticket-based' Pricing formula, which is going to improve Infy's margins further.
* More focus in the high margin software product business.
* Release of new retail software 'ShoppingTrip360' which is going to open up a whole new world in retail.
* More short term focus on growth than profitability in a market down time
* Establishing its foothold in 'Consulting business' to expand horizon.
* Making use of its huge cash pile of which 40 % is utilized for current acquisition
* Consistently above IT sector's avg profit margin
* Urge to be the global leader.
* Dollar appreciation against the local currency is just a blessing that came at the perfect time
The current acquisition is just a stepping stone for Infosys on its way to be the global leader.
Do not fall into the hype for a short term.
Infosys is only a tip of the ice berg of what it is going to be.
Cheers!
JP Morg removes infy, add freddie ,fannie
Posted by : sam_pdTracked by: 0 Boarder
News flashes :
JP Morgan has removed Infosys from 'Long Side' of Asia Pacific portfolio
So what they have added
JP Morgan added more of Freddie Mac and Fannie Mae so that they can write off more. lol
few more loudmouth FII's are going to air free advice on infy. ...
Down with the Acquisition !
Posted by : Infy_fan_alwaysTracked by: 0 Boarder
Dear all!
Stop creating unnecessary hype to the Axon acquisition.
What is more important is the company’s perspective and its attitude to be a true global leader.
* The recent initiative taken to reduce US dependency and increase other market penetration.
* All new 'Ticket-based' Pricing formula, which is going to improve Infy's margins further.
* More focus in the high margin software product business.
* Release of new retail software 'ShoppingTrip360' which is going to open up a whole new world in retail.
* More short term focus on growth than profitability in a market down time
* Establishing its foothold in 'Consulting business' to expand horizon.
* Making use of its huge cash pile of which 40 % is utilized for current acquisition
* Consistently above IT sector's avg profit margin
* Urge to be the global leader.
* Dollar appreciation against the local currency is just a blessing that came at the perfect time
The current acquisition is just a stepping stone for Infosys on its way to be the global leader.
Do not fall into the hype for a short term.
Infosys is only a tip of the ice berg of what it is going to be.
Cheers!
...
Infy stock to go up
Posted by : rajivkshTracked by: 0 Boarder
It is difficult of see how infosys can turn this company into a 30% operating margin level.
Infosys mgmt has not demonstrated such wonders in the past and only time can tell their strength in this area.
My opinion is that it will take time to be fruitful. Murthy and Nandan must have taken a really long term view. The key gain is the clients not the people of Axon. Axon have over 70 customers in Non-US geographies and I believe it is strength....
In reply to:
Infy stock to go up
Posted by : Guest
Infy stock is all set to go up with the acquisition of Axon. It is time to buy this stock.
Down with the Acquisition !
Posted by : Infy_fan_alwaysTracked by: 0 Boarder
Dear all!
Stop creating unnecessary hype to the Axon acquisition.
What is more important is the perspective and the attitude to be a true global leader.
* The recent initiative taken to reduce US dependancy and increase other market penetration.
* All new \\`Ticket-based\\` Pricing formula, which is gonna improve infy margins further.
* More focus in the high margin software product business.
* Release of new retail software \\`ShoppingTrip360\\` which is going to open up a whole new world in retail.
* More short term focus on growth than profitability in a market down time
* Establishing its foothold in \\`Consulting business\\` to expand horizon.
* Making use of its huge cash pile of which 40 % is utilized for current acquisition
* Consistently above market profit margin
* Urge to be the global leader.
* Dollar appreciation against the local currency is just a blessing at the right time
The current acquisition is just a steping stone for infy on its way to be the global leader.
Don\\`t fall into the hype for a short term.
Infy is only a tip of the ice berg of what it is going to be.
Cheers!...
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