Sector Analysis Report 1.docx

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INDIRA SCHOOL OF BUSINESS STUDIES

GLOBAL MANAGEMENT PROGRAM

(PGDMIB)

Batch 2012-14

SECTOR ANALYSIS

Prepared By:

Name: Manish Sangal

Division: D

Roll No: 23


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TABLE OF CONTENT

3 ACKNOWLEDGEMENT........................................................................................................ 4

4EXECUTIVESUMMARY ............................................................................................................... 5

5INDUSTRYOVERVIEWANDANALYSIS ..................................................................................... 7

THREAT OF NEW ENTRANTS TO AN INDUSTRY ............................................................................ 12

BARGAINING POWER OF SUPPLIERS ........................................................................................... 12

6 COMPANY PROFILE: ..................................................................................................................... 15

STRENGTHS: ...................................................................................................................................... 24

WEAKNESSES: ................................................................................................................................... 24

OPPORTUNITIES:............................................................................................................................... 25

THREATS: ........................................................................................................................................... 25

ANALYTICS & INFORMATION MANAGEMENT .......................................................... 32

APPLICATION SERVICES ............................................................................................... 33

CONSULTING SERVICES...................................................................................................... 35

7 ORGANISATIONS HUMAN RESOURCE PRACTICES .......................................................... 37

8 ORGANISATIONS FINANCIAL HEALTH ................................................................................ 41

9 ORGANISATIONS MARKETING PRACTICES...................................................................... 54

BUILDING TOMORROW'S IT INFRASTRUCTURE .............................................................................. 55

METALS AND MINING ........................................................................................................................... 57


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LIST OF FIGURES

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Figure 1: Industry Overview ................................................................................................................... 6

Figure 2: Pest Analysis ......................................................................................................................... 10

Figure 3: Porter Five Force Model........................................................................................................ 12

Figure 4: Infosys Company................................................................................................................... 15

Figure 5: Organization Structure........................................................................................................... 17

Figure 6: Business Operations .............................................................................................................. 23

Figure 7: Competitors ........................................................................................................................... 27

Figure 8: TCS Product .......................................................................................................................... 29

Figure 9: Cloud Service ........................................................................................................................ 34

Figure 10: Infrastructure Service .......................................................................................................... 56


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3 ACKNOWLEDGEMENT

I MANISH SANGAL of PGDM IB have shown efforts to complete the project report on

SECTOR ANALYSIS under the guidance of my mentor MR. ADITYA DESHPANDE SIR.

Without him this report was not possible.

I am highly indebted to MR.ADITYA DESHPANDE SIR for their guidance and constant

supervision as well as for providing necessary information regarding the project & also for

their support in completing the project.

I would also thank my Institution and my faculty members without whom this project would

have been a distant reality. I also extend my heartfelt thanks to my family and well wishers.

MANISH SANGAL


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4 EXECUTIVE SUMMARY

OVERVIEW

Company Name: Infosys Technologies Pvt Limited.

Infosys is the incredible story of success and successful execution of business model, the company has

entered red ocean market with insignificant stake and power in market, but because of successful market re-

definition company managed to achieve to be the first among the first ones and be remarkable example for

rivals.

So, what was the principal innovation that made Infosys successful?among the other reasons wecould say

that company managed to realize what was the market pain before anyone else and theymanaged to translate

it into successful business model. Business model proposed by Infosys redefined market needs, improvedservice time and quality and conceptually changed the game rules that bigger players where following.

Business model of Infosys was not complicated, yet it was very hard to copy because it required

from company flexibility and dynamic changes in busines processes. Business concept of Infosys was

different from any other companies because they managed to identify problematic areas of IT projects, they

realized that IT projects needed more and more detailed, customized business process mapping, which in a

most cases was done by independent consultants without relevant IT background, this was the reason why the

projects implemented by Infosys competitors had lowerquality and where holding high risk of failure or

contingency, on the other hand IT project implementations where taking in average 1 year to

implement, which also was a big disadvantage for it projects. Infosys combined business process mapping

service with the traditional IT projectpackage, created local implementation teams on shore and support teams

offshore this way company achieved to work on projects practically 24 hours every day. Changes in service

resulted higher quality in project implementation, as far as Infosys itself was doing business process mapping

and adjustments in existing system, project implementation time reduced to 6 month.

Another very innovative change in company performance was the measurement and assessment

methodologies, Infosys managed to start measuring almost everything, including customer satisfaction,

employee efficiency, financial results related to project implementations. This innovation was brake through

in existing environment because it was equally satisfying both, client companies and employees, also was

automatically and generously rewarding outstanding performance. By implementing and adopting above

mentioned changes company achieved to reach its goals in avery short period of time, it managed to achieve

fast growth and rank along side with larger playerson the market, managed to propose faster and better

services to customers and created unique organizational culture based on meritocracy and transparency.


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Figure 1: Industry Overview


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5 INDUSTRY OVERVIEW AND ANALYSIS

OVERVIEW OF IT & ITES

The IT & ITes sector includes IT services, engineering design and R&D services, ITES (IT-

enabled services) or BPO and hardware.

Today IT and ITeS sectors lead the economic growth in terms of employment, export

promotion, revenue generation and standards of living. As per NASSCOM estimates, IT/ITeS

sector (excluding hardware) revenues are estimated at USD 87.6 billion in FY 2011-12; and

the industry is expected to grow by 19 per cent during FY 2012-13.

The IT/ITeS sector has led to employment opportunities, both direct and indirect, of nearly

2.8 million and around 8.9 million respectively. This growth is expected to increase to more

than 14 million (direct and indirect) by 2015 and to around 30 million by 2030.

The market size of the industry is expected to rise to USD 225 billion by 2020 considering

India's competitive position, growing demand for exports, Government policy support, and

increasing global footprint.

IT/ITeS industry has led India's economic growth and this sector's contribution to the national

GDP has risen from 1.2 per cent in 1997-98 to an estimated 7.5 per cent in 2011-12.

Information Technology (IT) is defined as the design, development, implementation and

management of computer-based information systems, particularly software applications and

computer hardware. Today, it has grown to cover most aspects of computing and

technology. The largest firms globally include IBM, HP, Dell and Microsoft.

The Information Technology-Enabled Services (ITES) industry provides services that are

delivered over telecom or data network to a range of external business areas. Examples of

such business process outsourcing (BPO) include customer service, web-content

development, back office management and network consultancy etc.

Factors leading to growth in the IT/ITes sector are:

Low operating costs and tax advantage.

Favourable government policies.

Technically qualified personnel easily available in the country.

Rapid adoption of IT technologies in major sectors as Telecom, Manufacturing and

BFSI.


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Strong growth in export demand from new verticals and non-traditional sectors as

public sector, media and utilities.

Use of new and emerging technologies such as cloud computing.

SEZ as growth drivers; as more of SEZs are now being set up in Tier II cities and

about 43 new tier II/III cities are emerging as IT delivery locations.

All these factors have given IT/ITES industry in India a strong competitive position

with high market share.

All these factors have given IT/ITES industry in India a strong competitive position with high

market share.

Employment trends

As per the Economic Survey 2011-12, the IT/ITeS industries has added 7.96 lakh jobs in one

year, in the period ending September 2011.

According to NASSCOM, employee base in the rural areas is expected to increase by over 10

times by 2013-14, compared to 5000 in 2009-10.

According to a customer poll conducted by Booz and Co, India is the most preferred

destination for engineering off shoring, which are encouraging foreign companies to offshore

complete product responsibility to Indian ITeS companies

Hyderabad is fast becoming the IT/ITes hub of India with new players hankering to get a

foothold here, and existing players continuing to hire aggressively. Large companies such as

Infosys, TCS, Genpact, Deloitte, Facebook, Bank of America, Thomson Reuters, Amazon,

Google, Cognizant, Franklin Templeton among others, are growing their presence in the

state. According to Andhra Pradesh Government's estimates, the total IT/ITeS sector hiring

for 2012-13 could be at about 50,000 professionals.

Internet trends

More recently, online retailing, cloud computing and e-commerce are leading to rapid growth

in the IT industry. Online shopping is fast gaining popularity with the emergence of internet

retailing and e-commerce.

According to the Internet and Mobile Association of India (IAMAI) the number of Internet

users in the country is more than 121 million, out of which 17 million are online shoppers.

Increasing internet penetration and affordability for personal computers has led to this rapid

numbers, and these are expected to triple by 2015.

According to IAMAI, online sales of branded apparel almost doubled in volume to 4.99

million pieces during April 2012, as against 2.54 million in the same month a year ago. Also,


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E-ticketing continued to grow with irctc.com recording 5.56 million bookings in April, 2012,

as compared to 2.26 million bookings in April 2011.

Government Initiatives

In the twelfth Five Year Plan (2012-17), the Department of Information Technology proposes

to strengthen and extend the existing core infrastructure projects to provide more horizontal

connectivity, build redundancy connectivity, undertake energy audits of State Data Centers

(SDCs) etc. The core infrastructure including fibre optic based connectivity will be leveraged

and additional 150,000 Common Service Centres (CSCs) will be setup to create the right

Governance and service delivery ecosystem at the Panchayats.

PEST ANALYSIS

There are many factors in the macro-environment that will effect the decisions of the

managers of any organization. Tax changes, new laws, trade barriers, demographic change

and government policy changes are all examples of macro change. To help analyze these

factors, managers can categorize them using the PESTLE model.

PESTLE stands for Political, Economical, Social, Technical, Legislative and Environmental.

It is a strategic planning technique that provides a useful framework for analyzing the

environmental pressures on a team or an organization. It describes a framework of macro

environmental factors used in the environmental scanning component of strategic

management. It is a part of the external analysis when conducting a strategic analysis or

doing market research and gives a certain overview of the different macro environmental

factors that the company has to take into consideration. It is a useful strategic tool for

understanding market growth or decline, business position, potential and direction for

operations. PESTLE factors play an important role in the value creation opportunities of a

strategy. However they are usually outside the control of the corporation and must normally

be considered as either threats or opportunities.


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Figure 2: Pest Analysis

Political factors

These refer to government policies such as the degree of intervention in the economy. What

goods and services does a government want to provide? To what extent does it believe in

subsidizing firms? What are its priorities in terms of business support? Political decisions can

impact on many vital areas for business such as the education of the workforce, the health of

the nation and the quality of the infrastructure of the economy such as the road and rail

system, Government rules and regulations can also affect a business heavily. Rules and

regulations such as environmental regulations, industry specific regulations, competitive

regulations, consumer protection and various kinds of employment laws.

Economical factors

These include interest rates, taxation changes, economic growth, inflation and exchange rates,

governments spending levels, unemployment, job growth, tariffs, consumer confidence index

and import or export rations. Economic changes can have a major impact on a firm's

behavior.

Higher interest rates may deter investment because it costs more to borrow.


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A strong currency may make exporting more difficult because it may raise the price in

terms of foreign currency.

Inflation may provoke higher wage demands from employees and raise costs.

Higher national income growth may boost demand for a firm's products.

Social factors

These often look at the cultural aspects and include health consciousness, population growth

rate, demographics (age, gender ,race, distribution), career attitudes and emphasis on safety ,

lifestyle changes, population shifts, education trends, fads, diversity, immigration/emigration,

housing trends, fashion, attitudes to work, leisure activities, occupations and earning capacity.

Changes in social trends can impact on the demand for a firm's products and the availability

and willingness of individuals to work. Today the aging of population has become a huge

problem. This has increased the costs for firms who are committed to pension payments for

their employees because their staff is living longer. It also means some firms have started to

recruit older employees to tap into this growing labour pool. The ageing population also has

impact on demand: for example, demand for sheltered accommodation and medicines have

increased whereas demand for toys is falling.

Technological factors

Technological factors include ecological and environmental aspects and can determine

barriers to entry, minimum efficient production level and influence outsourcing decisions.

Technological factors look at elements such as R&D activity, automation, technology

incentives and the rate of technological change. New technologies create new products and

new processes. MP3 players, computer games, online gambling and high definition TVs are

all new markets created by technological advances. Online shopping, bar coding and

computer aided designing are all improvements to the way we do business as a result of better

technology. Technology can reduce costs, improve quality and lead to innovation. These

developments can benefit consumers as well as the organizations providing the products.

PORTERS FIVE FORCE MODEL

Porter identified five factors that act together to determine the nature of competition within an

industry. These are the:


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Threat of new entrants to a market

Bargaining power of suppliers

Bargaining powerof customers (buyers)

Threat of substitute products

Degree of competitive rivalry

Figure 3: Porter Five Force Model

Threat of new entrants to an industry

If new entrants move into an industry they will gain market share & rivalry will

intensify

The position of existing firms is stronger if there are barriers to entering the market

Ifbarriers to entry are low then the threat of new entrants will be high, and vice

versa

Barriers to entry are, therefore, very important in determining the threat of new entrants. An

industry can have one or more barriers.

Bargaining power of suppliers


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If a firms suppliers have bargaining power they will:

Exercise that power

Sell their products at a higher price

Squeeze industry profits

If the supplier forces up the price paid for inputs, profits will be reduced. It follows that the

more powerful the customer (buyer), the lower the price that can be achieved by buying from

them.

Suppliers find themselves in a powerful position when:

There are only a few large suppliers

The resource they supply is scarce

The cost of switching to an alternative supplier is high

The product is easy to distinguish and loyal customers are reluctant to switch

The supplier can threaten to integrate vertically

The customer is small and unimportant

There are no or few substitute resources available.

Bargaining power of customers

Powerful customers are able to exert pressure to drive down prices, or increase the required

quality for the same price, and therefore reduce profits in an industry.

A great example in the UK currently is the dominant grocery supermarkets which are able

exert great power over supply firms.

Customers tend to enjoy strong bargaining power when:

There are only a few of them

The customer purchases a significant proportion of output of an industry.

They possess a credible backward integration threatthat is they threaten to buy the

producing firm or its rivals.

They can choose from a wide range of supply firms.

They find it easy and inexpensive to switch to alternative suppliers.


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Threat of substitute products

A substitute product can be regarded as something that meets the same need.

Substitute products are produced in a different industry but crucially satisfy the same

customer need. If there are many credible substitutes to a firms product, they will limit the

price that can be charged and will reduce industry profits.

The extent of the threat depends upon

The extent to which the price and performance of the substitute can match the

industrysproduct

The willingness of customers to switch

Customer loyalty and switching costs

If there is a threat from a rival product the firm will have to improve the performance of their

products by reducing costs and therefore prices and by differentiation.


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Figure 4: Infosys Company

6 COMPANY PROFILE:

INFOSYS TECHNOLOGIES

INTRODUCTION:

Infosys Technologies Ltd was started in 1981 by seven people with US$ 250. Today, we are

a global leader in the "next generation" of IT and consulting with revenues of over US$ 4

billion. Infosys defines designs and delivers technology-enabled business solutions that help

Global 2000 companies win in a Flat World. Infosys also provides a complete range of

services by leveraging our domain and business expertise and strategic alliances with leading

technology providers.

Infosys' offerings span business and technology consulting, application services, systems

integration, product engineering, custom software development, maintenance, re-engineering,

independent testing and validation services, IT infrastructure services and business process

outsourcing Infosys pioneered the Global Delivery Model (GDM), which emerged as a

disruptive force in the industry leading to the rise of offshore outsourcing. The GDM is based

on the principle of taking work to the location where the best talent is available, where it

makes the best economic sense, with the least amount of acceptable risk. Infosys has a global

footprint with over 50 offices and development centers in India, China, Australia, the Czech

Republic, Poland, the UK, Canada and Japan.


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Infosys has over 103,000 employees. Infosys takes pride in building strategic long-term client

relationships. Over 97% of our revenues come from existing customers.

In an increasingly globalised world, significant complexity and uncertainty is getting attached

to the unprecedented economic crisis. The Indian economy has also been impacted by the

recessionary trends, with a slowdown in GDP growth to seven per cent. The focus and

exponential growth in the domestic market has partially offset this fall and insulated the

country, resulting in net overall momentum. The IT-BPO industry in India has today become

a growth engine for the economy, contributing substantially to increases in the GDP, urban

employment and exports, to achieve the vision of a "young and resilient" India. During the

year, the sector maintained its double digit growth rate and was a net hirer. This growth has

been fueled by increasing diversification in the geographic base and industry verticals, and

adaptation in the service offerings portfolio. While the effects of the economic crisis are

expected to linger in the near term future, the Indian IT-BPO industry has displayed

resilience and tenacity in countering the unpredictable conditions and reiterating the viability

of India's fundamental value proposition. Consequently, India has retained its leadership

position in the global sourcing market. The Indian IT-BPO industry is estimated to achieve

revenues of USD 71.7 billion in FY2009, with the IT software and services industry

accounting for USD 60 billion of revenues. During this period, direct employment is

expected to reach nearly 2.23 million, an addition of 226,000 employees, while indirect job

creation is estimated to touch 8 million. As a proportion of national GDP, the sector revenues

have grown from 1.2 per cent in FY1998 to an estimated 5.8 per cent in FY2009. Software

and services exports (including BPO) are expected to account for over 99 per cent of total

exports, employing over 1.76 million employees. While the current mood is that of "cautious

optimism," the industry is expected to witness sustainable growth over a two-year horizon,

going past its USD 60 billion export target in FY2011. While the industry has significant

headroom for growth, competition is increasing, with a number of countries creating enabling

business environments aimed at replicating India's success in the IT-BPO industry. Hence,

concentrated efforts are required by all stakeholders to address the current challenges, to

ensure that India realizes its potential, and maintains its leadership position.

6.1 Vision

"To be a globally respected corporation that provides best-of-breed business solutions,

leveraging technology, delivered by best in class people."


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6.1 Mission

"To achieve our objectives in an environment of fairness, honesty, and courtesy towards our

clients, employees, vendors and society at large."

6.2 ORGANIZATIONAL STRUCTURE OF INFOSYS

Figure 5: Organization Structure


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6.2 OWNERSHIP STRUCTURE


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6.3 EMPLOYEES STRENGTH

Infosys and its subsidiaries had 155,629 employees as of Dec 31, 2012.

6.4 REVENUE AND MARKET CAPITALIZATION

Consolidated results under International Financial Reporting Standards (IFRS) for the quarter

ended June 30,2012

Revenues were `9,616 crore for the quarter ended June 30, 2012;

YoY growth was 28.5%.

Net profit after tax was `2,289 crore for the quarter ended June 30, 2012;


Earnings per share (EPS) was `40.06 for the quarter ended June 30, 2012.


Other highlights:

51 clients were added during the quarter by Infosys and its subsidiaries.

Gross addition of 9,236 employees (net addition of 1,157) for the quarter by Infosys

and its subsidiaries.

1,51,151 employees as on June 30, 2012 for Infosys and its subsidiaries.

Business outlook

The companys outlook (consolidated) for the fiscal year ending March 31, 2013, under IFRS

is as follows:

Revenues are expected to be at least `40,364 crore.

YoY growth of 19.7%.

Earnings per share (EPS) is expected to be at least `166.46.

YoY growth of 14.4%.


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MARKET CAPITALIZATION

Number of Shares(Q3 FY13) 574,236,166

Market capitalization (Q3 FY13) (Rs. Crore) 133,206

6.5 BUSINESS OPERATIONS AND PLANT LOCATIONS

Efficient Business Operations:

At Infosys, we pioneered and perfected the global delivery model, introducing to our

customers the ability to move technology work to different locations where talent is readily

available and quality is both impeccable and cost competitive. Over the years we have

applied this model to a full range of services - both technical and business. Our IT services

such as application integration, testing, maintenance and infrastructure management ensure

your operations are fully optimized. Our business process outsourcing and management

services, such as customer service delivery, human resource outsourcing and procurement

handling, drive down process costs while greatly enhancing their efficiencies. Most

importantly, as part of our strategic sourcing approach, these services free up resources that

can then be deployed to drive transformation and innovation initiatives.

Infosys delivers a trusted Cloud ecosystem for its clients. Our offerings address all aspects of

Cloud adoption backed by a best-in-class partner ecosystem. We take complete lifecycle

ownership of your Cloud initiative providing you with a single point of accountability. Our

industry-leading services in the Cloud enable several line-of-business functions such as sales,

marketing and human resources along with industry functions such as banking. We host,

operate and manage these services on a subscription-based pricing model providing you with

rapid time-to-value.

Proven framework for business value articulation:

Complementing our operations capability is our associated Business Value Articulation

methodology. Built on the pillars of analyze-propose-deliver, it guarantees that you can

review the ROI of your engagement with us and are well-positioned to justify the business

value of any aspect of the project in clear measurable terms.


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Figure 6: Business Operations

Our relentless service execution capability draws strength from world class teams that are

unusually well-trained. Our employees undergo an intensive 24-week training regimen at our

world-class training facility before engaging with a customer.

6.6 JOINT VENTURES AND ALLIANCES

Infosys & KSA Joint Venture:

In 1987, Infosys entered into a joint venture with Kurt Salmon Associates(KSA), a

leading global management consultancy firm. KSA Infosys was the first Indo American

joint venture in the US.

In 1988-89, Infosys set up its first office in the US. Infosys then increased its share from 40%

to 50%stake in 1993. The name of the new company was changed to Software Sourcing

Corporation. KSA was responsible for sourcing projects for the joint venture and infosys

provided the software expertise and technical knowledge.

Infosys & Smart Internet Technology Joint Venture:


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Infosys Technologies signed an agreement with Smart Internet Technology

Cooperative Research Centre and the Commonwealthand state governments of

Australia, for joint efforts in research and developments.

Infosys invested upto Australian $800,000 for R&D over the next four years. While Smart

Internet stand to gain from the development, commercialisation and export of Australian

intellectual property. On the other hand, it will give Infosys an opportunity to explore new

ways of generating market-driving intellectual property and further augment its competitive

positioning.

The collaboration is expected to provide commercial benefits to the Commonwealth

Government and state governments of Australia in the form of new employment and revenue

opportunities.

An exchange of knowledge and skills will also benefit Australian researchers who will have

the unique opportunity to work with the Infosys on collaborative R&D projects, adds the

release.

6.7 SWOT ANALYSIS OF INFOSYS TECHNOLOGIES

STRENGTHS:

Leadership in sophisticated solutions that enable clients to optimize the

efficiency of their business.

Proven "Global delivery model"

Commitment to superior quality and process execution

Strong Brand and Long-Standing Client Relationships

Ability to scale Innovation and leadership.

WEAKNESSES:

Excessive dependence on US for revenues, - 67 % of revenues from USA.

Weak player in domestic market. Only 1% of revenues from India - low as

compared to peers.

Low R & D spending as compared to global IT companies - only 1.3 % of total

revenues.

Low expertise in high end services like Consultancy and KPO.


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OPPORTUNITIES:

Domestic market set to grow by 20%.

Expanding into new geographies - Europe, Middle East etc.

Infosys is cash rich (Around US $ 1 Billion).

Acquiring companies to increase expertise in Consultancy, KPO and package

implementation capabilities

Opening offices and development centers in cost advantage countries such as

those in Latin America and Eastern Europe.

THREATS:

Global economic slowdown may continue for several years - hence low IT

spending globally.

US Govt. against outsourcing.

Shrinking margins due to rising wage inflation, Rupee-dollar movementaffects

revenue and hence margins.

Increased competition from foreign firms like Accenture, IBM etc.

Increased competition from low-wage countries like China, Indonesia etc.

6.8 CSR AND SUSTAINABLE BUSINESS PRACTICES

Infosys employees actively participate in the welfare of the local community. Our

Development Centers (DCs) in India make a difference through several Corporate Social

Responsibility (CSR) initiatives. CSR at infosys includes the following activities:

Rakum School for the visually challenged: Mitr, our local CSR team, visited the

Rakum School for the visually challenged. Mobility, an exercise in which team

members walked blindfolded using canes, helped them empathize with the children.

The team organized games and distributed chocolates and stationery.

Notebook distribution: The Infynite Smiles CSR team has been distributing books

and stationery to underprivileged children across Karnataka since 2001. In 2009, the

team touched more than 45,000 lives, including the tribal community. We collected

donations amounting to Rs. 10,00,000. Our drive has been actively supported by the

Dream School Foundation, Ramana Clinic, Sri Vivekananda Youth Movement,

Chrysalis and other NGOs.


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Behavior and social skills development: Prayaas, our local CSR team, organized a

program where 60 children from the Panchkula slum showcased their creativity in

group activities. The children were imparted training in social etiquette.

Medical camp and cleanliness drive: Prayaas has adopted Tanda village to drive

social transformation in the region. Our volunteers engaged residents in a cleanliness

drive to prevent malaria. A free camp for eye and general medical check up was

organized. Medicines and spectacles prescribed by doctors at the camp were

distributed free of cost. The team collected data on health and sanitation related issues

to address them.

PC donation drive: Mamata, our local CSR team, donated more than 105 PCs to

institutions that undertake non-commercial and public activities. We have already

invited requests for the next list of beneficiaries.

Day of Change: Every Wednesday, drop boxes are placed at the campus entrance and

exit points, food courts and parking area to collect coins from Infoscions for social

welfare activities.

Eye donation camp: More than 330 Infoscions pledged to donate their eyes in a

special camp organized with the Ruby Hall Clinic and Eye Bank Association of India.

Play and Live (PAL): We use sports to boost the confidence of underprivileged

children, teach them various skills and change their outlook. We donated sports

equipment including carom and chess boards, and prizes such as watches, perfumes

and chocolates.

Blood donation camp: 700 volunteers donated blood during a two-day camp in June

2009. Three blood banks - ISIS Blood Bank, KEM and Janakalyan - participated.

Doctors highlighted the need for safe blood donation at the camp.

6.9 COMPETITIVE ANALYSIS

The three top competitors of Infosys Technologies are as listed below:

Satyam Computers Services Limited.

Tata Consultancy Services Limited.

Wipro Technologies.


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Figure 7: Competitors

6.9.1 VISION AND MISSION STATEMENT OF THE COMPANY

VISION OF TCS

One must forever strive for excellence or even perfection, in any task however small, and

never be satisfied with the second best

MISSION OF TCS

To help customers achieve their business objectives by providing innovative, best-in-class

consulting, IT solutions and services. To make it a joy for all stakeholders to work with us.

6.9.2 PRODUCTS AND SERVICE MIX

PRODUCTS AT TCS:

TCS BaNCS enables transformation in financial services through a superior and

holistic suite of solutions for banks, capital market firms, insurance companies and

diversified financial institutions. Each solution in the TCS BaNCS family has been

designed to run as a scalable and robust service, fully integrated with existing

business models, enterprise infrastructures and technology architectures. With our

collaborative and innovative approach, financial services organizations can gain the

following:

A competitive advantage and provide differentiated solutions to their customers

Increased operational efficiency and agility

Certainty in delivery

TCS BaNCS is a globally recognized industry leader, with its solutions consistentlyranked in top positions by industry experts.


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Maharashtra Gramin Bank and C-Edge Technologies are recognized as the winners of

The Asian Banker Achievement Awards 2012 under the category Technology

Implementation Awards for the Best ASP-based program.

TCS emerges as the most valuable company in the BT 500 list for the year 2012.

TCS moves up to second place among global providers of financial technology in

FinTech 100 ranking for the fifth consecutive year.

TCS is featured in the Forbes Asias Fab 50 list for the fifth time. It is also recognized

as one ofthe 50 Most Engaged Workplaces in the US.

TCS is ranked fourth in the Most Valuable IT Services Brand global survey

conducted by Brand Finance, the worlds leading brand valuation firm (May 2012).

TCS BaNCS wins the Xcelent award for Advanced Technology in each of the three

Celent reports on Core Banking solutions for small, mid-sized and large banks. TCS

BaNCS also emerged first in Breadth of Functionality in the report for small banks.

In the Core Banking Solutions for Mid-size Banks - A Global Perspective report by

Celent, TCS BaNCS scored the #1 position for Advanced Technology and the 3

position for Functional Breadth among 14 vendors and their respective offerings.

TCS BaNCS succeeded in retaining the #3 position in Universal Banking in the IBS

Sales League Table - the most important industry barometer.

TCS BaNCS is recognized as 3 Core Banking Solution in the 2011 IBS Sales League

Table.

TCS MasterCraft, a comprehensive suite of products, provides extensive self-help

and SLA-based support that enable the optimization of all services encompassing

development, deployment, maintenance, support and transformation.Used extensively

over 300 projects in both client and TCS delivery environments, TCS MasterCraft

represents our commitment to delivery optimization by enabling speed and quality of

delivery.


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Figure 8: TCS Product

It comprises eight suites of products, spanning all the service lines of application design,

development, delivery, support and maintenance:

TCS MasterCraft Build Suite:An integrated set of products that provide end-to-end

application lifecycle management capabilities, which support software development,

quality assurance and release management processes for both traditional and agile

software development lifecycles

TCS MasterCraft Sustain Suite: An integrated set of products to execute, manage and

govern IT services comprising application maintenance and support, and infrastructure

support

TCS MasterCraft Transform Suite: An integrated set of products and environment to

help you prepare, analyze, reverse engineer and transform your applications and data from

their current to the desired future state

TCS MasterCraft Performance Suite: An integrated set of products that provide end-

to-end application performance management capabilities, thereby reducing production

turnaround and troubleshooting times


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TCS MasterCraft Test Data and Environment Management Suite: An integrated set

of products that offer a well-coordinated processes to create and manage test data

effectively, thereby securing the testing environment against data privacy violation

TCS MasterCraft Enterprise Data Management Suite: An integrated set of products /

services that enable you to manage your data quality, metadata, architecture / models,

security and master data with an effective governance mechanism

TCS MasterCraft AppMaker Suite: A set of products that enable platform-independent

Model-driven Development (MDD) for prototyping and developing small-medium and

enterprise applications

TCS MasterCraft Technology Suite: A stack of standalone products that address niche

problems such as dynamic data masking, service governance management, user activity

management, workflow management, collaboration management, and application analysis

and intelligence.

ASSURANCE SERVICES

TCS Assurance Services provide complete suite of services across the test value cycle. Th is

includes consulting, functional, non functional and test support services.

Consulting:

Test strategy (Enterprise and Program).

Test process definition, assessment and benchmarking.

Test Center of Excellence (TCoE).

Structural code assessment.

Test automation strategy, tooling and frameworks.

Performance test strategy, tooling and frameworks.Security test strategy, tooling and frameworks.

Test environment and data management.

Niche testing strategy.

Tool / product evaluation, administration and management.

Functional / Non Functional / Test Support Services:

Requirement management.


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Static analysis and structural code evaluation.

Unit and integration testing.

Functional testing (system, end-to-end, system integration).

Performance testing (load, volume, stress, monitoring, tuning, etc.)

Security testing.

Non-functional testing (accessibility, usability, operability, localization, Operations

Acceptance Testing (OAT), etc.)

Regression testing.

Test automation.

Environment management handling data, release and configuration management

User Acceptance Testing (UAT).

6.9.3 MARKET SHARE AND MARKET CAPITALISATION

MARKET SHARE:

Tata Consultancy Services has a Market Share of 1.3% as on year 2012. This market share

leaves plenty of headrooms for the future growth.

MARKET CAPITALISATION:

The current market capitalisation of Tata Consultancy Services as on 15th March,2013 is Rs.

309041.88 and is still retains the Rank 1 position in the list.

6.9.4 STRENGTHS AND WEAKNESSES OF TCS:

STRENGTHS:

High command on local and domestic market(India).

Strong brand backing that is TATA.

Ethics or moral values are very strong of TCS.

WEAKNESSES:

TCS is not very strong in different products segments.

Significant exposure to financial services market.

Lack of scale in consulting operations.


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VISION OF WIPRO:

Contribute for global e-society, where a wide range of information is being exchanged

beyond time and space over global networks, which breaks down the boundaries among

countries, regions and cultures, allowing individuals to take part in various social activities in

an impartial, secure way. Continous effort to enhance people's lifestyle and quality by means

of developing new technology in wireless communication.

MISSION OF WIPRO:

Our mission is to be a RF System Solution Provider, through its innovative research and

design works for a new world of broadband wireless communications.

6.9.2 SERVICE MIX OF WIPRO TECHNOLOGIES:

Analytics & Information Management

Enterprises today need insights into markets, customers and their own internal

processes, faster than their competitors to capitalize on opportunities and to deliver

sustainable business performance. To do this, businesses need to go beyond the customary

approaches to data and its management. For quick decisions, they must learn to cope with thehigh volume and velocity of real-time structured and unstructured data in different formats.

Leading Industry analysts have suggested that those who do this will outperform competition

by 20% in every financial metric.

More and more business leaders are looking at Analytics and Information Management

Technologies as critical enablers to outperform. Wipro leverages its KPI backwards

approach, deep industry expertise and experience in handling complex analytics and

information management engagements, to deliver differentiation at the front and

standardization at the core. Wipro solutions bring together the combined expertise of process,

analytics and data to orchestrate business insights to assist our customers Do Business Better.

Our services include:

Business Analytics - that empowers organizations with actionable insights across aspects

concerning their customers, products and services.

Business Intelligence and Performance Management - that enables businesses to

improve operational efficiencies and drive transformation and change management

initiatives.


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Information Management - that provides a competitive edge through improved

management of information and lowers business risk.

Application Services

Business Applications: The Heart of Ongoing Transformation

What does it take to thrive in todays fast-moving business climate? We believe its a

combination of global, forward-thinking strategies and high-impact technology solutions to

support them.

Every company, every day relies on robust, agile business applications to run their front

officesto reach new customers, get into new markets, and sell products and services. They

rely on business applications in the back officeto maintain records, manage inventory,

process analytics, and coordinate general administrative functions. Forward-facing business

applications are at the heart of ongoing transformationand if they are to truly support the

business, they must be simultaneously a foundation for success and flexible enough to

promote agility to enable organizations to quickly respond to inevitable change.


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The services and solutions offered by Wipros Application Services Practices create the edge

organizations must have to assert their competitiveness in their markets. Our integrated

business solutions span the application and technology landscape, from enterprise

applications and digital transformation to security and testing. We help drive business

innovation by integrating next generation technology into the enterprise IT landscape. We

transform business processes. We maximize and extend the value of package applications.

We aggregate cutting-edge applications to drive collaboration and commerce with customers.

We enable secure IT operations. And with an effective global delivery model, we assure a

total quality approach for applications and technology solutions anywhere in the world.

Figure 9: Cloud Service

Cloud Services:

In a world driven by varied macro and micro economic pressures, business agility andscalability are key factors for success. CIOs are recognizing that for any organization,

Cloud is the way to achieve on-demand agility and seamless scalability in operations.

Our customers are beginning to realize the potential of Cloud to meet their need for

standardization, variabilization and simplification of their IT footprint. The faster an

organization finds comfort with Cloud technology, and begins to innovate, the sooner

the payback will be realized. Cloud adoption is now beyond experimentation it has

produced quantifiable and measurable ROI, and accelerated the speed of innovation inthe organization.


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Consulting Services

At Wipro Consulting, we help companies think ahead. Business today is evolving

faster than at any other time in history, and tomorrow there are going to be challenges we

can't even imagine today. And opportunities. But to survive and thrive, we must imagine thatfuture. We must anticipate it.

Even while we're helping you solve your business challenges today, we're thinking about the

future - and how we can take you there. Which is what gives you the competitive edge in

what's to come.

IT Infrastructure Management Services:

IT and infrastructure management services have undergone a significant change and

increasingly. IT teams are focused on delivering business value, improved efficiency and

variabilization of costs. The focus of business nowadays has turned to: "How can we leverage

IT infrastructure for business growth and innovation? and, How can IT infrastructure

management help businesses to be more agile and flexible, addressing demands such as

ramp-up or ramp-down considering the prevailing macroeconomic scenarios?"

Wipro's infrastructure management services with its strong domain capabilities and

specialized capabilities spanning Data Center, End User Computing, Networks, Managed

Services, Cloud, Business Advisory and Global System Integration helps businesses across

the globe to transform their vision to reality.

Our services are built on the concept of 'Standardization at the backend' to bring in

operational efficiencies and drive down costs. We also help our customers to variabilize their

IT costs to bring in Business Agility in the current macro-economic scenario.

Infra Services business is at a tipping point & Wipro is geared to evolve the Next Gen IT

Infrastructure by leveraging our IP tools & frameworks such as CIGMA , GCC, Helix,

Fixomatic and so on.

6.9.4 STRENGTHS AND WEAKNESSES OF WIPRO


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Strengths:

Global R&D facility.

Retention of the man-power is the best in the industry.

Impressive list of clientele.

Relatively lower recievable compared to the industry average.

Diversified skill base across service lines.

Weaknesses:

Low operating margins of the other group companies.

Free floating stock is very less.

Domestic market was huge but was underdeveloped.

Small player in global market.

Limited domain.

6.9.3 MARKET CAPITALISATION OF SATYAM

Based on recorded statements the market capitalization of Satyam Computer Services

Limited is about 137.67 B. This is 427.12% higher than that of Technology sector, and

390.67% higher than that of Information Technology Services industry, The Market

Capitalization for all stocks is 1119.1% lower than the firm
http://www.macroaxis.com/invest/marketScreener/stockIndustry/marketCap/Information_Technology_Serviceshttp://www.macroaxis.com/invest/marketScreener/stockIndustry/marketCap/Information_Technology_Services


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7 ORGANISATIONS HUMAN RESOURCE PRACTICES

7.1 STRUCTURE OF THE HR DEPARTMENT IN INFOSYS

Figure 12


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7.2 PERFORMANCE APPRAISAL SYSTEM

Infosys has now hired global HR consultant Mercer to work on the overhaul its Performance

Appraisal system and the process will be completed before June. Our current performance

management system does not meet the requirements of a 100,000-plus organisation. The newsystem is undergoing evaluation by Mercer, TV Mohandas Pai, Infosys director for HR,

education, research and administration .

The key aspects being looked at in the new system include sharper focus on technology,

condensing the number of roles while increasing span of control. The new system will seek to

define roles more clearly and try to more carefully match roles to employee aspirations.

All programmers may not want to become managers. As we grow and move up the value

chain there will be more opportunities for engineers to either go deeper into technology areasor take up senior managerial roles. The overhaul will provide us with room to create more

options and multiple career streams for employees, Mr Pai added, while declining to share

specific details on the overhaul.

The current span of control is 1:2:5.5. That is, on an average for every one project manager

there are two managers and 5.5 developers. Now, with the increasing number of employees

this could increase. On the other hand programmers who dont want to be managers can opt

for hi-tech areas like technology architecture, system designers and so on.

The overhauled system while catering to a larger employee base will also try and create more

opportunities to move up the ladder. The larger companies (like TCS, Infosys) are looking at

the structure keeping in view the growing employee base and challenges they might face a

decade or two from now. At present the employee force is young and most of them are

programmers. They may not like to be programmers as the workforce ages. The overhaul will

help meet those challenges.

7.3 EMPLOYEE ENGAGEMENT PRACTICES

The highly productive and the most reputed companies across the world have understood the

fact that it was employee engagement that made them stand apart from all other

companies. Different companies had taken different initiatives to enhance the level of

engagement among employees towards their jobs and the organisation .


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Each company has its own reasons to establish a specific type of reward-motivation

programme depending upon their financial status, region in which they are operating and

level which they function at and the backgrounds of the employees. In the year 201, an

annual study conducted by the research arm of Kenexa, a leading global HR solution

provider, revealed that Indian giants rank highest as compared to their peers in other

countries when it comes to employee engagement and effective leadership.

When compared on the national level, India with 71 percent employee engagement ratio

secured the topmost rank

while Japan was at the lowest position with 38 percent ratio. This was a surprising fact as it is

believed that Indian companies have miles to cover in order to achieve what global

companies have done already. Factors that made India stand apart from rest of the countries

were employee recognition, emphasis of improvement of quality, show of genuine

responsibility of organisation towards employees and opportunities to grow.

Infosys in year 2011 plans to have its own radio in establishing a healthy and quick

interaction and communication amongst employees. The company also plans to host talk

shows where top management would interact with the employees. Besides this, the company

also has a social networking portal like Facebook. Named as Bubble, it helps employees

connect to their colleagues, seniors, subordinates and top management. Infosys had also

created Infosys Television.

7.4 RENOWNED HR PRACTICES OF INFOSYS

Infosys Technologies, a leading software company based in India, was voted the best

employer in the country in many HR surveys in the recent years. The company was well

known for its employee friendly HR practices. Though Infosys grew to become a US$ 2

billion company by the year 2006, it still retained the culture of a small company. Infosys

attracted the best talent from across the world, and recruited candidates by conducting one of

the toughest selection process. All the selected candidates were required to go through an

intensive 14 week training program. All the employees were required to undergo training

every year, and some of the chosen employees were trained at the Infosys Leadership

Institute to take on higher responsibilities in the company.


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Infosys was one of the first companies to offer ESOPs to its employees. The company

followed variable compensation structure where the employees' compensation depended on

the performance of individual, the team and the company. The case highlights many such best

practices of Infosys in human resource management. It also discusses the challenges faced by

the company to retain its talented workforce.


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8 ORGANISATIONS FINANCIAL HEALTH

8.1 BALANCE SHEET ANALYSIS

Consolidated Balance Sheet as of(In Rs crore except share data)March

31, 2012March

31, 2011

ASSETS

Current assets

Cash and cash equivalents 20,591 16,666

Available-for-sale financial assets 32 21

Investment in certificates of deposit 345 123

Trade receivables 5,882 4,653

Unbilled revenue 1,873 1,243

Derivative financial instruments - 66

Prepayments and other current assets 1,523 917

Total current assets 30,246 23,689

Non-current assets

Property, plant and equipment 5,409 4,844

Goodwill 993 825

Intangible assets 173 48

Available-for-sale financial assets 12 23

Deferred income tax assets 316 378

Income tax assets 1,037 993

Other non-current assets 162 463

Total non-current assets 8,102 7,574

Total assets 38,348 31,263

LIABILITIES AND EQUITY

Current liabilities

Trade payables 23 44

Derivative financial instruments 42 -

Current income tax liabilities 1,054 817

Client deposits 15 22

Unearned revenue 545 518

Employee benefit obligations 498 140

Provisions 133 88Other current liabilities 2,456 2,012


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Total current liabilities 4,766 3,641

Non-current liabilities

Deferred income tax liabilities 12 -

Employee benefit obligations - 259

Other non-current liabilities 109 60

Total liabilities 4,887 3,960

Equity

Share capital- 5 par value 60,00,00,000 equity shares authorized, issuedand outstanding 57,13,96,401 and 57,13,17,959, net of 28,33,600 treasuryshares each, as of March 31, 2012 and March 31, 2011, respectively

286 286

Share premium 3,089 3,082

Retained earnings 29,816 23,826

Other components of equity 270 109

Total equity attributable to equity holders of the Company 33,461 27,303

Non-controlling interests - -

Total equity 33,461 27,303

Total liabilities and equity 38,348 31,263

PROFIT & LOSS ACCOUNT

Particulars 2011-12 2010-11 2009-10 2008-09 2007-08

Revenue 33,734 27,501 22,742 21,693 16,692

Operating Profit (PBIDT) 10,723 8,968 7,861 7,195 5,238

Interest - - - - -

Depreciation & Amortization 928 854 905 761 598

Provision for taxation 3367 2,490 1,681 919 685

PAT from ordinary activities 8,332 6,835 6,218 5,988 4,659

Dividend (inc dividend tax) 3,137 4,013 1,674 1,573 2,225


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8.1.1 DIRECTORS REPORT:

Corporate

Infosys was incorporated in Pune, in 1981, as Infosys Consultants Private Limited, a private

limited company under the Indian Companies Act, 1956. We changed our name to InfosysTechnologies Private Limited in April 1992 and to Infosys Technologies Limited in June

1992, when we became a public limited company. We made an initial public offering in

February 1993 and were listed on stock exchanges in India in June 1993. Trading opened at

145 per share, compared to the IPO price of 95 per share. In October 1994, we made a

private placement of 5,50,000 shares at 450 each to Foreign Institutional Investors (FIIs),

Financial Institutions (FIs) and body corporates.

Dividend policy

The dividend policy is to distribute up to 30% of the consolidated Profit After Tax (PAT) of

the Infosys group as dividend.

Unclaimed dividend

Section 205 of the Companies Act, 1956, mandates that companies transfer dividend that has

been unclaimed for a period of seven years from the unpaid dividend account to the Investor

Education and Protection Fund (IEPF). In accordance with the following schedule, the

dividend for the years mentioned as follows, if unclaimed within a period of seven years, will

be transferred to IEPF.

Year Type ofdividend

Dividend pershare ( )

Date ofdeclaration

Due date fortransfer

Amount ( )(1)

2004 Final(2)

115.00 Jun 12, 04 Jul 11, 11 27,53,100

2005 Interim 5.00 Oct 12, 04 Nov 11, 11 5,95,535

Final 6.50 Jun 11, 05 Jul 10, 12 5,82,452

2006 Interim 6.50 Oct 11, 05 Nov 10, 12 4,88,384

Final(3)

38.50 Jun 10, 06 Jul 9, 13 17,28,727

2007 Interim 5.00 Oct 11, 06 Nov 10, 13 6,46,835

Final 6.50 Jun 22, 07 Jul 21, 14 9,16,420

2008 Interim 6.00 Oct 11, 07 Nov 10, 14 10,91,136Final

(4) 27.25 Jun 14, 08 Jul 13, 15 30,41,349

2009 Interim 10.00 Oct 11, 08 Nov 10, 15 21,47,850

Final 13.50 Jun 20, 09 Jul 25, 16 20,24,481

2010 Interim 10.00 Oct 09, 10 Nov 14, 16 18,95,420

Final 15.00 Jun 12, 10 Jul 17, 17 25,36,950

2011 Interim(5)

40.00 Oct 15, 10 Nov 20, 17 54,44,880

(1) Amount unclaimed as at March 31, 2011.

(2) Includes one-time special dividend of 100/- per share.

(3) Includes silver jubilee special dividend of 30/- per share.

(4) Includes special dividend of 20/- per share.


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(5) Includes 30th year special dividend of 30/- per share.

The Company is sending periodic communication to the concerned shareholders, advising

them to lodge their claims with respect to unclaimed dividend. Shareholders are cautioned

that once unclaimed dividend is transferred to IEPF, no claim shall lie in respect thereof with

the Company.

Dividend remitted to IEPF during the last three years

Fiscal Amount ( )

2011 4,48,296

2010 6,60,204

2009 6,49,767

Investor services

Tentative calendar

Quarter ending Earnings

release

Quiet period

Jun 30, 2011 Jul 12, 2011 Jun 16 to Jul

14, 2011

Sep 30, 2011 Oct 12, 2011 Sep 16 to Oct

14, 2011

Dec 31, 2011 Jan 12, 2012 Dec 16, 2011

to Jan 14,

2012

Mar 31, 2012 Apr 13, 2012 Mar 16 to Apr

15, 2012

Annual General Meeting

Date and time June 11, 2011, Saturday,

3 p.m. IST

Venue The Christ University

Auditorium, Hosur Road,

Bangalore 560 029

Book closure dates May 28, 2011 to June 11,

2011

Dividend payment date June 13, 2011

Investor awareness

Maintaining the highest standards of corporate governance is not a matter of mere form, but

of substance. In continuation of our efforts in that direction, we have provided a synopsis of

some of your rights and responsibilities as a shareholder on our website, www.infosys.com.

We encourage you to visit our website and read the document. We hope that the document


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will give you appropriate guidance, though in brief, on any questions regarding your rights as

a shareholder.

Dematerialization of shares and liquidity

Infosys shares are tradable compulsorily in electronic form and, through Karvy

Computershare Private Limited, Registrars and Share Transfer Agents, we have established

connectivity with both the depositories, that is, National Securities Depository Limited

(NSDL) and Central Depository Services (India) Limited (CDSL). The International

Securities Identification Number (ISIN) allotted to our shares under the Depository System is

INE009A01021.

As at March 31, 2011, 99.72% of our shares were held in dematerialized form and the rest in

physical form.

We were the first company in India to pay a one-time custodial fee of 44.43 lakh to NSDL.

Consequently, our shareholders do not have to pay depository participants, the custodial fee

charged by NSDL on their holding.

Shares held in demat and physical mode as at March 31, 2011 are as follows :

Category Number of % to total

equityshareholders shares

Demat mode

NSDL 3,31,093 56,68,67,476 98.73

CDSL 84,986 56,81,625 0.99

Total 416,079 57,25,49,101 99.72

Physical mode 544 16,02,458 0.28

Grand total 4,16,623 57,41,51,559 100.00

To enable us to serve our investors better, we request shareholders whose shares are in

physical mode to dematerialize shares and to update their bank accounts with the respective

depository participants.

Secretarial auditAs a measure of good corporate governance practice, the Board of Directors of the Company

appointed Parameshwar G. Hegde, Practicing Company Secretary, to conduct Secretarial

Audit of records and documents of the Company. The Secretarial Audit Report confirms that

the Company has complied with all the applicable provisions of the Companies Act, 1956,

Depositories Act, 1996, Listing Agreements with the Stock Exchanges, and all the

Regulations and Guidelines of the Securities and Exchange of India (SEBI) as applicable to

the Company. The audit also covers the reconciliation on a quarterly basis, the total admitted

capital with National Securities Depository Limited (NSDL) and Central Depository Services


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(India) Limited (CDSL) and the total issued and listed capital. The audit has confirmed that

the total issued / paid up capital is in agreement with the aggregate total number of shares in

physical form and the total number of dematerialized shares held with NSDL and CDSL.

Further, the company voluntarily adheres to the various Secretarial Standards issued by the

Institute of Company Secretaries of India.

Investor complaints

Received Attended

Nature of complaints 2011 2010 2011 2010

Dividend / Bonus related 706 629 706 629

We attended to most of the investors grievances / correspondences within a period of ten

days from the date of receipt of such grievances. The exceptions have been for cases

constrained by disputes or legal impediments.

Designated e-mail address for investor services

In terms of Clause 47 (f) of the Listing Agreement, the designated e-mail address for investor

complaints is [email protected]

Legal proceedings

There are certain pending cases related to disputes over title to shares in which we had been

made a party. However, these cases are not material in nature.

Shareholders holding more than 1% of the shares

The details of shareholders (non-founders) holding more than 1% of the equity as at March

31, 2011 are as follows :

Name of the shareholder No.of

Shares

%

Life Insurance Corporation of India 2,45,97,487 4.28

Oppenheimer Developing Markets Fund 1,25,56,971 2.19

Abu Dhabi Investment Authority 1,10,65,282 1.93

Franklin Templeton Investment Funds 99,87,588 1.74

ICICI Prudential Life Insurance Company Limited 84,09,519 1.46

Vanguard Emerging Markets Stock Index Fund 70,88,500 1.23

Government of Singapore 63,01,219 1.10

Aberdeen Asset Managers Limited 62,68,000 1.09

Bajaj Allianz Life Insurance Company Limited 61,41,329 1.07


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Name of the shareholder No.of

Shares

%

HDFC Trustee Company Limited 59,05,736 1.03

(1)

Financial institution(2) Foreign institutional investor

(3) Body corporate

Distribution of shareholding as at March 31, 2011

Range of equity shares held No.of

shareholders

% No.of shares %

1 14,561 3.50 14,561 0.00

2-10 1,92,179 46.13 12,85,207 0.22

11-50 1,37,501 33.00 36,49,192 0.64

51-100 31,252 7.50 24,74,459 0.43

101-200 15,387 3.70 23,48,626 0.40

201-500 9,991 2.40 33,09,698 0.58

501-1,000 5,846 1.40 43,36,039 0.76

1,001-5,000 6,267 1.50 1,47,43,304 2.57

5,001-10,000 1,434 0.34 1,01,97,201 1.7810,001 and above 2,204 0.53 43,07,43,251 75.02

Total 4,16,622 100.00 47,31,01,538 82.40

Equity shares underlining ADS 1 0.00 10,10,50,021 17.60

Total 4,16,623 100.00 57,41,51,559

8.1.2 AUDITORS REPORT

ToThe Members of

Infosys Limited

(formerly Infosys Technologies Limited)

Report on the Financial Statements:

We have audited the accompanying financial statements of Infosys Limited (`the

Company`) which comprise the Balance Sheet as at 31 March 2012, the Statement of Profit


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and Loss and the Cash Flow Statement for the year then ended and a summary of

significant accounting policies and other explanatory information.

Management`s Responsibility for the Financial Statements:

Management is responsible for the preparation of these financial statements that give a true

and fair view of the financial position, financial performance and cash flows of the

Company in accordance with the Accounting Standards referred to in sub-section (3C) of

section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the

design, implementation and maintenance of internal control relevant to the preparation

and presentation of the financial statements that give a true and fair view and are free from

material misstatement, whether due to fraud or error.

Auditor`s Responsibility:

Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the Standards on Auditing issued by the Institute

of Chartered Accountants of India. Those Standards require that we comply with ethical

requirements and plan and perform the audit to obtain reasonable assurance about whether

the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and

disclosures in the financial statements. The procedures selected depend on the auditor`s

judgment, including the assessment of the risks of material misstatement of the financial

statements, whether due to fraud or error. In making those risk assessments, the auditor

considers internal control relevant to the Company`s preparation and fair presentation

of the financial statements in order to design audit procedures that are appropriate in

the circumstances. An audit also includes evaluating the appropriateness of accounting

policies used and the reasonableness of the accounting estimates made by management, as

well as evaluating the overall presentation of the financial statements.We believe that the

audit evidence we have obtained is sufficient and appropriate to provide a basis for our

audit opinion.

Opinion:

In our opinion and to the best of our information and according to the explanations given

to us, the financial statements give the information required by the Act in the manner so

required and give a true and fair view in conformity with the accounting principles generally

accepted in India:


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(i) In the case of the Balance Sheet, of the state of affairs of the Company as at 31 March

2012.

(ii) In the case of the Statement of Profit and Loss, of the profit for the year ended on that

date.

(iii) In the case of the Cash Flow Statement, of the cash flows for the year ended on that

date.

Report on Other Legal and Regulatory Requirements:

1. As required by the Companies (Auditor`s Report) Order, 2003 ("the Order"), as

amended, issued by the Central Government of India in terms of sub-section (4A) of

section 227 of the Act, we give in the Annexure a statement on the matters specified in

paragraphs 4 and 5 of the Order.

2. As required by section 227(3) of the Act, we report that:

a. We have obtained all the information and explanations which to the best of our knowledge

and belief were necessary for the purpose of our audit.

b. In our opinion proper books of account as required by law have been kept by the Company

so far as appears from our examination of those books.

c. The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by

this Report are in agreement with the books of account.

d. In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement

comply with the Accounting Standards referred to in subsection (3C) of section 211 of

the Companies Act, 1956.

e. On the basis of written representations received from the directors as on 31 March 2012,

and taken on record by the Board of Directors, none of the directors is disqualified as on 31

March 2012, from being appointed as a director in terms of clause (g) of sub-section (1) of

section 274 of the Companies Act, 1956.

For B S R & Co.

Chartered Accountants

Firm`s registration number: 101248W

Natrajh Ramakrishna

Partner

Membership number: 32815


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Place: Bangalore

Date : 13th April, 2012.

8.1.3 CASH FLOW STATEMENT:

Consolidated Statements of Cash Flowsfor the years ended March 31 , (milliondollars)

2012 2011

Operating Activities:

Net profit $1,716 $1,499

Adjustments to reconcile net income tonet cash provided by operatingactivities:

Depreciation and amortization 195 189

Income on investments (8) (22)

Income tax expense 694 547

Effect of exchange rate changes assetsand liabilities

7 -

Other non cash item 1 1

Changes in working capital

Trade receivables (247) (254)

Prepayments and other assets (13) (52)

Unbilled revenue (131) (88)

Trade payables (5) 7

Client deposits (1) 3

Unearned revenue 6 (3)

Other liabilities and provisions 123 98

Cash generated from operations 2,337 1,925

Income taxes paid (656) (627)

Net cash provided by operatingactivities

1,681 1,298

Investing Activities:

Payment for acquisition of business, net ofcash acquired

(42)

Expenditure on property, plant and (301) (285)


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equipment, including changes in retentionmoney

Payment on acquisition of intangible assets (19)

Loans to employees (5) (7)

Deposits placed with corporation (23) (22)

Income on investments 6 5

Investment in certificates of deposit (75) (185)

Redemption of certificates of deposit 31 436

Investment in available-for-sale financialassets

(1,247) (425)

Redemption of available-for-sale financial

assets

1,245 973

Net cash used in investing activities (430) 490

FINANCING ACTIVITIES:

Proceeds from issuance of common stockon exercise of employee stock options

1 5

Payment of dividends (including corporatedividend tax)

(501) (816)

Net cash used in financing activities (500) (811)

Effect of exchange rate changes on cashand cash equivalents

(441) 62

Net increase in cash and cash equivalents 751 977

Cash and cash equivalents at thebeginning

3,737 2,698

Cash and cash equivalents at the end ofthe year

$4,047 $3,737

Supplementary information:Restricted cash balance $52 $24


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8.1.4 RATIO ANALYSIS & INTERPRETATION

RATIO CALCULATION PURPOSE

Current ratio Current ratio =

current asset/current

liabilities

The ratio tell us about the

capabilities of company to

discharge its short term

liabilities

Quick ratio Quick assets/quick liabilities Ratio indicates immediate

liquidity of the company

Cash ratio Cash + Cash

Equivalents/Current Liabilities

It measures the ability of a

business to repay its current

liabilities by only using its

cash and cash equivalents

and nothing else

Return on assets (profit after tax/total assets)

x100

How firm has used assets to

maximize profit.

Return on capital employed (PBIT/capital employed)

x100

Profitability of the capital

employed in the business.

Total debt ratio Total debts/total assets Depicts the proportion oftotal assets financed by theshare holders

debt equity ratio Total debt/Net Worth Money for retuns to be givento share holders

Assets turn over ratio Net sales /total assets

Price earning ratio market price pershare/earnings per share

8.1.4.1 Current Ratio: Current Assets/Current Liabilities

: 30246/4766

: 6.34.

8.1.4.2 Liquid Ratio: Quick Assets/Quick Liabilities

: 30246/4766

: 6.34.


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8.1.4.3 Cash Ratio: Cash & Cash Equivalents/Current Liabilities

: 20591/4766

: 4.32 times.

8.1.4.4 Return on Assets: PAT/Total Assets x 100

: 8332/31263 x 100

: 26.6%.

8.1.4.5 Return on Capital Employed: PBIT/Capital Employed x 100

: 10723/30102 x 100

: 35.6%

8.1.4.6 Total Debt Ratio: Total Debts/Total Assets

: 4766/38348

: 0.124 times.

8.1.4.7 Debt-Equity Ratio: Total Debt/Net Worth

: 4766/30102

: 0.15 times.


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9 ORGANISATIONS MARKETING PRACTICES

9.1 CUSTOMER SOLUTION

Armed with deep industry knowledge and best-of-breed business solutions, Infosys helps

enterprises harness technology across their value chain.

Business transformation: Infosys assists manufacturers in ERP-led business

transformation, process simplification, and global rollouts. We also deliver improved

adaptability through better visibility and configurability, higher collaboration through

unified communications, and better product market strategies.

Accelerating innovation: We enhance 'product market thinking' with our expertise in

digital marketing and social media with our digital consumer platform Infosys

SocialEdge. This platform is a key technology in our strategy to enhance customer

proximity.

Efficient operations: Business platforms from Infosys for end-to-end process

outsourcing; procure-to-pay, order-to-cash and finance and accounting processes

enhance and enable asset and operations optimization.

9.1.1 SERVICE MIX & CUSTOMER SEGMENTS OF INFOSYS

Services provided by the Infosys technologies are under the following heads:

IT Services.

Engineering Services.

Consulting Services.

BPO Services.

IT Services:

Infosys' IT services leverage our domain and business expertise. We offer IT-enabled

business solutions along with a complete range of services. The IT services are further

divided into the following categories:

Application Services:

The application services includes the following features:

Integrated Sourcing: The Pathwayto achieve more for less.

Implement performance engineering for consistent business performance.

Offshore programs: Converting challenges into opportunities.


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Offshoring: Making the shift from cost savings to innovation.

Managing the complexities of designing the global Applications.

Building tomorrow's IT infrastructure

Today, enterprises face intense pressure to stay agile and responsive to a volatile

business environment. The emergence of cloud computing, virtualization, and mobility is

forcing enterprises to rethink the way they do business. These changes are leading to a

rethink on how IT Infrastructure Services are being designed, provisioned, and maintained for

both internal and external clients of an enterprise. Right now, the focus is on delivering

measurable business value through IT.

Challenges and opportunities

Alignment to business: Emerging technologies such as cloud and mobility are rapidly

changing the business landscape. To cater to the growing demands, enterprises require an IT

infrastructure that is assured and scalable to keep pace with the competition.

Consumerization of IT: Enterprises seeking competitive advantage must adapt to this trend

at the user-computing base at the front-end as well as at the back-end data centers to provide

users with a computing workspaceanytime, anywhere.

From Capex to Opex: Virtualization can make the enterprise less dependent on data center-

based technology assets thus translating a significant amount of capital spend into

operational spend, and also lowering the costs over the long-term, based on usage.

Global regulations and compliance: Regulatory and sustainability concerns have

implications for every IT decision. Navigating a range of government regulations across

geographic locations and managing compliance are business-critical issues that call for

potent, cost-effective technology framework and services.

How Infosys delivers business value

An optimized IT infrastructure can create business value for enterprises by leveraging

existing technology assets and emerging trends while creating efficient internal processes.

With a proven consulting-led approach, Infosys enables enterprises to leverage emerging

technologies while optimizing their IT infrastructure.


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Figure 10: Infrastructure Service

CUSTOMER SEGMENTS

The various segments in which the Infosys is serving the customers are as follows:

Agribusiness.

Chemicals.

Metals and Mining.

Agribusiness:

Food producers, processors and distributors face new challenges in supply chain

management. Agribusiness leaders need better analysis and engineering with respect

to consumption and distribution patterns, as well as with the design and

implementation of new models for managing operations and technology.

How Infosys Delivers Business Value

Infosys implements solutions to address the specific challenges of the Agribusiness

industry by helping to improve performance, comply with industry regulations, adhere


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strictly to environmental and safety norms and take advantage of better asset

utilization and improved production schedules.

We help you achieve increased margins through better understanding of customer

needs, minimized production variations, reduced operational costs, and improved

product quality.

Control costs and increase flexibility: Infosys delivers ERP/BI implementation,

integration and upgrades, accounting and HR, BPO-IT Infrastructure, accelerated

outsourcing/process transformations, sourcing/procurement and IT operations and

customer information systems, risk management/compliance services including

traceability, and reporting to improve product quality.

Optimize and regularize supply chain services: Infosys provides supply chain

planning and execution services spanning management of suppliers and distributors

and facilitates optimum use of available capacities by providing standardized business

processes.

R&D services to create new products and grow new markets : We provide

assistance in R&D and help you create new product lines that cater to emerging

market needs.

Chemical:

The industry is seeing a paradigm shift from commodity chemicals to specialty products

brought about by mergers and acquisitions, divestitures and new product innovation. As

industry players explore alternative raw material sources, they face significant margin

pressures due to unprecedented rise in costs of raw materials, transportation and energy. In

addition, employee safety and compliance with environmental norms and regulations are the

new focus areas.

Metals and Mining

Metals and Mining companies need to address challenges such as market-driven product

pricing, lack of quality mineral deposits, absence of skilled workforce, diminishing margins,

shortage of power and raw materials, and escalating energy, transportati

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