Infosys' stocks fall steepest in over 4 years as Sikka quits

Infosys' stocks fall steepest in over 4 years as Sikka quits

Infosys' stocks fall steepest in over 4 years as Sikka quits

The Infosys share price has dropped about 14.5% since Friday morning, leading to the abrupt erosion of wealth among investors, notably the founders, who together have a 12.74% stake.

I don't think mutual funds would take an immediate decision to dump the stock heavily in light of these developments.

The announcement of the company's first-ever buyback could offer at least some respite to Infosys shareholders after the value of their holdings fell almost 10 per cent last Friday following Sikka's surprise exit. Sikka will remain at the company as executive vice chairman until a permanent CEO is appointed.

According to media reports, Murthy reportedly said that several independent directors at Infosys told him Sikka was more suited to be a chief technology officer than CEO. It could also create obstacles in expanding Infosys' order book and mining for large clients, he said.

Brokerages like JP Morgan, HDFC Securities, Edelweiss Financial Services, ICICI Securities, Nomura and Antique Stock Broking have already downgraded Infosys after Sikka's resignation.

The company's push into automation, cloud computing and data analytics, meanwhile, has yet to reap big revenues.

North Korea warns of merciless strikes
But Mattis has not backed down from the possibility of a military confrontation with North Korea. The North responded by threatening to fire missiles toward the U.S.


Infosys on Monday crashed out of India's 10 most valued companies' list after the exit of Vishal Sikka as managing director and CEO of the company.

The public row at Infosys is reminiscent of Cyrus Mistry's unceremonious November ousting as boss of Tata Group over differences with the Tata family patriarch, Ratan Tata.

The shares of Infosys tanked 5.37 per cent on Monday to close the session at Rs 873.50 on the BSE. The firm's market value surged by US$4.6 billion to US$31.78 billion over the period.

Infosys, which counts Apple, Volkswagen and Wal-Mart Stores Inc among its customers, has under-performed the Nifty IT index this year amid public attacks from its founders and the USA challenges.

Miller added that "Murthy has much to answer for" as Infosys is now set for another period of uncertainty as it seeks a new leader.

During his tenure, Sikka has pushed the company towards innovation and veered away from being a mere service provider. "While in near term it's (Dr Sikka's resignation) a setback for the company, but given the strength of the board of the company, we believe that the company will be overcome the setback", Sarabjit Kour Nangra, VP (Research- IT) at Angel Broking said.

Latest News