Infosys Limited – Navigate your next.
Date Published: August 4, 2022
Company Overview:
Infosys Limited (Infosys or “the company”) is a provider of business and technology consulting, enterprise solutions, systems integration, and custom application development services. It offerings also include application maintenance and production support, infrastructure management, independent testing and validation, cloud ecosystem integration, product engineering and lifecycle solutions, business process management, software products, and business platforms and solutions. It has business presence in around 50 countries. The company operates in Asia Pacific, the Americas, Europe and Middle East & Africa.Infosys is a global leader in next-generation digital services and consulting. Established in 1981, Infosys is a NYSE listed global consulting and IT services company with more than 310k employees.
Industry Overview:
The IT industry accounted for 8% of India’s GDP in 2020. According to STPI (Software Technology Park of India), software exports by the IT companies connected to it, stood at Rs. 1.20 lakh crore (US$ 16.29 billion) in the first quarter of FY22.Indian software product industry is expected to reach US$ 100 billion by 2025. Indian companies are focusing to invest internationally to expand global footprint and enhance their global delivery center’s. Exports from the Indian IT industry stood at US$ 149 billion in FY21. Export of IT services has been the major contributor, accounting for more than 51% of total IT export (including hardware). BPM and Engineering and R&D (ER&D) and software products exports accounted for 20.78% each of total IT exports during FY21. ER&D market is expected to grow to US$ 42 billion by 2022.The IT industry added 4.5 lakh new employees in FY22 (as of February), the highest addition in a single year. Women accounted for 44% of the total new employees.In Union Budget 2022-23, the allocation for IT and telecom sector stood at Rs. 88,567.57 crore (US$ 11.58 billion).The government introduced the STP Scheme, which is a 100% export-oriented scheme for the development and export of computer software, including export of professional services using communication links or physical media.
Segment wise Company Operations:
The company classifies its business operations into eight reportable segments: Financial Services; Retail; Communication; Energy, Utility, Resources and Services; Manufacturing; Hi-Tech; Life Sciences; and All Other Segments.
Financial Services segment: The company include enterprises in Financial Services and Insurance. In FY2021, the Financial Services segment generates revenue of INR3,25,830 million, which accounted for 32.4% of the company’s revenue.
Communication segment: The company includes enterprises in Communication, Telecom OEM and Media. In FY2021, the Communication segment generates revenue of INR1,26,280 million, which accounted for 12.6% of the company’s revenue. Energy, Utility, Resources and Services segment Infosys provides transmission & distribution and Generation and Trading services such as Power Generation, and Energy Trading and Risk Management services; Enterprise Services such as Digital Solutions, Managed Services, and Enterprise Analytics; Customer Service such as Customer Information System (CIS), Customer Analytics, and Customer Experience Management services. In FY2021, the Energy, Utility, Resources and Services segment generates revenue of INR1,25,390 million, which accounted for 12.5% of the company’s revenue.
India GeographyPerformance: Reported revenue of INR1,63,302.6 million for FY2021, which decreased 15.1% YoY, and recorded negative growth of 0.2% during 2017-21. India accounted for 56.3% of the company’s revenue in FY2021.
Manufacturing segment: The company provides BPM services, industry 4.0, IT services and operational excellence. In FY2021, the Manufacturing segment contributed revenue of INR94,470 million, which accounted for 9.4% of the company’s revenue. Under Hi-Tech segment, Infosys includes enterprises in Hi-Tech. In FY2021, the Hi-Tech segment contributed revenue of INR85,600 million, which accounted for 8.5% of the company’s revenue.Rest of the world GeographyPerformanceReported revenue of INR1,26,872.8 million for FY2021, which grew 3.9% YoY, and recorded a CAGR of 12.6% during 2017-21. Rest of the world accounted for 43.7% of the company’s revenue in FY2021.
Life Science Segment: The company offers Application Portfolio Rationalization Services, Digital Marketing Services, pharma manufacturing, IQVIA orchestrated customer engagement (OCE) and Medical Device Engineering services. In FY2021, the Life Science segment contributed revenue of INR68,700 million, which accounted for 6.8% of the company’s revenue.
All other segment: Infosys includes revenue generated from the customers based in India, Japan, China, and Infosys Public Services (IPS) and other enterprises in public services. In FY2021, the other segment reported revenue of INR31,000 million, which accounted for 3.1% of the company’s revenue.Geographically, the company classifies its business operations into four regions: North America, Europe, Rest of the world, and India. In FY2021, the North America region accounted for 61.4% of the company’s revenue, followed by Europe with 24.2%, followed by Rest of the World 11.6% and remaining 2.9% was contributed by India.