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k peek into the performance of the IT bellwether..

Prepared by -
Nikhilesh Kumar V
Ranjit Pisharody
Ramya H V
Satheesh KumarA P
Sree Murugan S
 Contents

1 Introduction
2 Balance sheet
3 Financial Ratios
4 Cash flow statements
5 Inference
6 How investors see it?
7 Bibliography

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 Infosys arrives..

• Seed money of Rs. 10000

• Softronics opened in 1976
but was soon shut down due to poor
market response
• Quit Patni in 1981 and set up
Infosys at Pune.
• Signs up its first client, Data Basics
corporation
• The Early Trials & Failures
• The Change from 1989

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The story continues..
• Goes public in 1993
• In 2006, it became the first Indian
company to ring the NASDAQ Stock
Market Opening Bell
• In 2002: Business World named Infosys
"India's Most Respected Company“
• 2006: August 20, N. R. Narayana Murthy
retired from his position as the executive
chairman
• 2007: April 13, Nandan Nilekani stepped
down as CEO and made way for Kris
Gopalakrishnan to occupy his chair
effective June 2007

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 Key Industries
Infosys serves various industries through its Industrial Business Units (IBU), such as:
• Banking & Capital Markets (BCM)
• Communications, Media and Entertainment (CME)
• Energy, Utilities and Services (EUS)
• Insurance, Healthcare and Life Sciences (IHL)
• Manufacturing (MFG)
• Retail, Consumer Product Goods and Logistics (RETL)
• New Markets and Services (NMS) : Non US and Non European markets, SaaS,
Learning Services
• India Business Unit (IND)

In addition to these, there are Horizontal Business Units (HBUs)

• Consulting (CS)
• Enterprise Solutions (ES): ERP, CRM, HCM, SCM, BI/DW, BPM-EAI
• Infrastructure Management Services (IMS)
• Product Engineering and Validation Services (PEVS)
• Systems Integration (SI)
• Finacle : Core Banking Product
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Balance Sheet (Rs Crore)
Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05
Sources of funds
Owner's fund
Equity share capital 286.00 286.00 286.00 138.00 135.29
Reserves & surplus 17,523.00 13,204.00 10,876.00 6,759.00 5,106.44
Total 17,809.00 13,490.00 11,162.00 6,897.00 5,241.73
Uses of funds
Fixed assets
Gross block 5,986.00 4,508.00 3,889.00 2,837.00 2,182.72
Less : accumulated depreciation 2,187.00 1,837.00 1,739.00 1,275.00 1,005.82
Net block 3,799.00 2,671.00 2,150.00 1,562.00 1,176.90
Capital work-in-progress 615.00 1,260.00 957.00 571.00 317.52
Investments 1,005.00 964.00 839.00 876.00 1,328.70

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 Contd.. (Rs Crore)
Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05
Net current assets
Current assets, loans & 15,732.00 12,326.00 9,040.00 6,105.00 3,764.65
advances
Less : current liabilities & 3,342.00 3,731.00 1,824.00 2,217.00 1,346.04
provisions
Total net current assets 12,390.00 8,595.00 7,216.00 3,888.00 2,418.61

Miscellaneous expenses - - - - -
not written
Total 17,809.00 13,490.00 11,162.00 6,897.00 5,241.73
Notes:
Book value of unquoted 1,005.00 964.00 839.00 876.00 1,328.70
investments
Market value of quoted - - - - -
investments
Contingent liabilities 347.00 603.00 670.00 523.00 289.87

Number of equity 5728.30 5719.96 5712.10 2755.55 2705.71

sharesoutstanding (Lacs)
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Financial ratios - Liquidity
Liquidity ratios
Mar ‘09 Mar ‘08 Mar ‘07 Mar ’06 Mar ‘05
Current ratio 4.71 3.3 4.96 2.75 2.8
Quick ratio 4.67 3.28 4.91 2.73 2.77

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Solvency
Leverage ratios
Mar ‘09 Mar ‘08 Mar ‘07 Mar ’06 Mar ‘05
Long term debt / Equity - - - - -
Total debt/equity - - - - -
Owners fund as % of total source 100 100 100 100 100
Total Liabilities/Total Assets 13.8

Total Liabilities/Total Assets 13.8

Industry Comparison

Source : Business Week

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Valuation
Per share ratios
Mar ‘09 Mar ‘08 Mar ‘07 Mar ’06 Mar ‘05
Adjusted EPS (Rs) 108.08 78.06 65.42 90.65 68.38
Reported EPS (Rs) 101.58 78.15 66.23 87.86 70.38
Dividend per share 23.5 33.25 11.5 45 11.5
Price/Earning 21.07 - - - -

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Payout ratios
Payout ratios
Mar ‘09 Mar ‘08 Mar ‘07 Mar ’06 Mar ‘05
Dividend payout ratio (net profit) 27.03 49.77 19.85 58.32 18.48
Earning retention ratio 74.6 50.17 79.91 43.48 80.98

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Profitability ratios
Profitability ratios
Mar ‘09 Mar ‘08 Mar ‘07 Mar ’06 Mar ‘05
Operating margin (%) 34.09 31.72 32.13 33.11 33.91
Gross profit margin (%) 30.66 28.23 28.57 28.58 30
Net profit margin (%) 27.52 27.37 28.05 26.17 27.28

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Healthy Bottom-line

Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05
Adjusted PBT 7,086.00 5,095.00 4,089.00 2,801.00 2,175.57
Adjusted PAT 6,191.00 4,465.00 3,737.00 2,498.00 1,850.27

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Per share ratios

Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05
Adjusted EPS (Rs) 108.08 78.06 65.42 90.65 68.38
Dividend per share 23.5 33.25 11.5 45 11.5

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PROFITABILITY - INFOSYS TECHNOLOGIES LTD (INFY)

Return on Assets 18.61%

Industry Comparison

Return on Capital 21.73%

Industry Comparison

Return on Equity 32.07%

Industry Comparison

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ASSET TURNOVER - INFOSYS TECHNOLOGIES LTD
(INFY)

Total Assets 1.0

Turnover
Industry Comparison

Fixed Assets 4.8

Turnover
Industry Comparison

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 Cash flow statements
Profit before tax
Net cashflow-operating
activity
Net cash used in investing
activity
Netcash used in fin. activity
Net inc/dec in cash and
equivlnt
Cash and equivalnt begin of
year
Cash and equivalnt end of
year
(Rs Crore)
Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05
6,714.00 5,100.00 4,129.00 2,724.00 2,184.49
5,152.00 3,816.00 3,256.00 2,237.00 1,359.70
-195.00 -978.00 -1,065.00 -392.00 -939.88
-2,430.00 -777.00 -316.00 244.00 -580.10
2,600.00 2,079.00 1,871.00 2,096.00 -156.32
7,689.00 5,610.00 3,779.00 1,683.00 1,839.40
10,289.00 7,689.00 5,650.00 3,779.00 1,683.08
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Net cash flow

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Funds from Funds from Funds from
operation financing investment

+ + +
+ + -
+ - -
- + -
- - +
- - -

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Inference

• Funds from operation: +

• Funds from investments: -
• Funds from financing: -
Hence, we see that INFY is a well managed company. It
does not depend on capital market, it has its own funds.

During the 14-year period from its IPO in 1993 to 2007, the price of an
Infosys share increased 3000 fold. This excludes the dividends that the company
has paid out over that duration.

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 How investors see it?

 Infosys Q2 profit up 7.5 pct, raises FY10 forecast

 Business climate improves, but currency volatility worrying

BANGALORE, Oct 9 (Reuters) -Infosys Technologies Ltd beat street
expectations with a 7.5 percent rise in quarterly profit and raised its full year
forecast as demand for outsourcing grows and pricing pressure eases.
India's second-biggest software services exporter, a trend setter for the
industry, said business environment improved in the September quarter and
pricing stabilized, but currency volatility was a worry.

“The global currency markets continue to be extremely volatile, even

though we have seen some stability in the rupee against the U.S. dollar
this quarter”, Chief Financial Officer V. Balakrishnan said in a statement.

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 Strengths
• Immerses new workers in
the value system which is
summed up in the letters
C-L-I-F-E
• No single client contributes
for more than 10% of the
revenue
• No single technology
contributes for more than
25% of the revenue
• Dynamic leadership – no
single leader for a long time
• Ethics
• Highly customer driven

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Bibliography

• http://www.infosys.com/investors/reports-
filings/default.asp
• http://en.wikipedia.org/wiki/Infosys
• http://finapps.forbes.com/finapps/jsp/finance/compi
nfo/Ratios.jsp?tkr=infy
• http://www.kamalsinha.com/iit/people/narayana-
murthy/infosys.html

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hank you!
Thank you

Questions?
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