Infosys - Renew; Learn New Mantra for Success; Company Update :: Edelweiss PDF link

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Infosys’ CEO, Dr. Vishal Sikka, at the company’s Annual Analyst Day positively surprised us by setting forth a simple path to lead Infosys towards the No 1 position. The strategy is based on 3 simple tenets: 1) renewal of core businesses; 2) innovation in new businesses; and 3) ushering in the culture of learning. We believe these steps will rid Infosys of almost all the issues that it faced it in past few years. While the execution of his strategy will be gradual, we believe the company has identified its key challenges, which is crucial for the corrective measures to roll out in right earnest. We remain positive on Infosys as this three-pronged approach will resolve issues concerning focus on core business and manpower, which had led the underperformance to peers in past few years. Maintain ‘BUY’ with TP of INR2,285.

Renew core- innovate new-culture of learning: New mantra ahead

The emphasis on products and platforms in its 3.0 strategy resulted in it losing out on its core business segments. Dr. Sikka’s current strategy gives equal importance to both the core and new businesses. The strategy revolves around renewing core services, through automation, innovation, use of artificial intelligence (AI) and digital technologies without disrupting them. At the same time, focusing on innovation in new services through design thinking (DT), innovative services, creating platforms and partnerships with start ups. He is focused on the importance of DT as it involves identifying a problem and not just solving it. The third pillar of the strategy, culture of learning revolves around creating an environment where employees are able to add value to themselves and in turn to the organisation (refer pg 2 for detailed strategy).

LINK

https://www.edelweiss.in/research/Infosys--Renew;-Learn-New-Mantra-for-Success;-Company-Update/27762.html