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Infosys shareholders dilemma

, April 17, 2013, 1 Comments

Infosys results are out and stock is down by 20%, it’s out and was big.  By the time market were up on Friday, shareholders of Infosys lost to the tune of  INR 35,000 crs. This brings to the question whether the Management is confident or doing everything right, as this doesn’t adds up for the share holders of Indian IT giant Infosys?
Let’s look at how shares of Infosys behaved in last 5 quarters on the day of results
[ws_table id=”10″]

To be or not to be (Share holder)
The main confusion in the minds of highly satisfied shareholders who have been rewarded generously in the past by IT Bellwether Infosys, while the enterprise is moving up the ladder in terms of delivery and clients acquisition , it is still passing through the transformational stage. There is no doubt over the quality of management but as shown in above result (chart) the shareholders has seen the rocky ride in past 5-7 quarters.

Safety or loyalty
Another burning question which every shareholder is asking – whether they stay invested or move out and look beyond Infosys. As it represent a classical dilemma. They are left with no clear cut options nor able to make a decision. However time has shown if one stays loyal, quality management has been able to perform which in turn resulted in good bounty.

Guidance or No Guidance
Much has been debated and discussed about the practice of giving guidance. There is enough case for it and against it. In a country like India where progressive capitalism is evolving, Infosys has itself set highest corporate governance standard and management is still confident and supportive regarding their practice of giving guidance.

Right or Wrong
After all one  has to decide “is it worth to be “Wrong” only on the day of result or come out “Right” in the long run and  overcoming the temporary transformational stage thereby prove every critic wrong at the end.

So which side you are gone bet next time the day before Infosys results will come out?

About author
Sumeet is Mumbai based Chartered Accountant, having 10+ years of Strong Experience across Finance & Taxation domain. His expertise includes setting up Finance & Accounting Function and Managing team of professionals to deliver end to end spectrum of F&A, Statutory & Management Audits, Taxation, Costing, Treasury & Funds Management & Finalization of Financial Statements etc. While working with ICICI Prudential, Rajasthan Royals he had the experience in Strategy Planning & Decision making support, implementing financial strategies. ...more
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