MOSL: INFOSYS (Buy)-Steadfast peace with the arrival of Mr. Nandan Nilekani-Addresses risk of further downside
​INFOSYS: Steadfast peace with the arrival of Mr. Nandan Nilekani; Addresses risk of further downside; more to do for gradual valuation re-rating
(INFO IN, Mkt Cap USD32.5b, CMP INR913, TP INR1050, 15% Upside, Buy)
- ​Infosys (INFO) announced the appointment of Mr. Nandan Nilekani as non-executive non-independent Chairman of the Board.
- It also accepted the resignation of Mr. R. Seshasayee, Professor Jeffrey Lehman and Professor John Etchemendy with immediate effect.
- Dr. Sikka too stepped down as Executive Vice Chairman and as a Director.
- With Nandan Nilekani as Chairman, Ravi Venkatesan stepped down as the Co-Chairman of the Board; he would however continue as an Independent Director.
What do the developments mean for Infosys, the stock?
Steadfast return of peace puts downside risks behind
- ​At 14.6x FY18E and 13.6x FY9E earnings, only continued brawl in the open and prolonged Board and leadership uncertainty presented further downside risk. But INFOs steadfast actions around the near-dissolution of the Board and return of Mr. Nandan Nilekani – the consensus choice in the scenario – has taken care of that risk.
- The fact that it took only a week for this to play out, is a positive, as INFO can now look forward to addressing business issues.
Infosys is a global technology services company based in India. Co. provides business consulting, technology, engineering and outsourcing services. Co.'s end-to-end business solutions include: Consulting and Systems Integration - consulting, enterprise solutions, systems integration and advanced technologies; Business IT Services - application development and maintenance, independent validation services, infrastructure management, engineering services comprising product engineering and life cycle solutions and business process management; and Products, business platforms and solutions, including Finacle™, which addresses core banking, mobile banking and e-banking needs of banks worldwide.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
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