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ek into the performance of the IT bellwether .
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Prepared by Nikhilesh Kumar V Ranjit Pisharody Ramya H V Satheesh KumarA P Sree Murugan S
Contents
1 2 3 4 5 6 7
Introduction Balance sheet Financial Ratios Cash flow statements Inference How investors see it? 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
Sources of funds Owner's fund Equity share capital Reserves & surplus Total Uses of funds Fixed assets Gross block Less : accumulated depreciation Net block Capital work-in-progress Investments
Mar ' 08
Mar ' 07
Mar ' 06
Mar ' 05
286.00 286.00 17,523.00 13,204.00 17,809.00 13,490.00
286.00 10,876.00 11,162.00
138.00 6,759.00 6,897.00
135.29 5,106.44 5,241.73
5,986.00 2,187.00 3,799.00 615.00
4,508.00 1,837.00 2,671.00 1,260.00
3,889.00 1,739.00 2,150.00 957.00
2,837.00 1,275.00 1,562.00 571.00
2,182.72 1,005.82 1,176.90 317.52
1,005.00
964.00
839.00
876.00
1,328.70
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Contd.. Net current assets Current assets, loans & advances
(Rs Crore)
Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05 15,732.00
12,326.00
9,040.00
6,105.00
3,764.65
Less : current liabilities & 3,342.00 provisions
3,731.00
1,824.00
2,217.00
1,346.04
Total net current assets
8,595.00
7,216.00
3,888.00
2,418.61
-
-
-
-
13,490.00
11,162.00
6,897.00
5,241.73
964.00
839.00
876.00
1,328.70
-
-
-
-
603.00
670.00
523.00
289.87
5719.96
5712.10
2755.55
2705.71
12,390.00
Miscellaneous expenses not written Total 17,809.00 Notes: Book value of unquoted 1,005.00 investments Market value of quoted investments Contingent liabilities
347.00
Number of equity 5728.30 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 Total Liabilities/Total Assets
100 13.8
100
100
100
100
Total Liabilities/Total Assets Industry Comparison
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13.8
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) Dividend per share Profit/Earning
101.58 78.15 23.5 33.25 21.07 -
66.23 11.5 -
87.86 45 -
70.38 11.5 -
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Payout ratios Payout ratios Dividend payout ratio (net profit) Earning retention ratio
Mar ‘09 Mar ‘08 Mar ‘07 Mar ’06 Mar ‘05
27.03 49.77
19.85
58.32
18.48
74.6
79.91
43.48
80.98
50.17
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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
Adjusted PBT Adjusted PAT
Mar ' 08
7,086.00 6,191.00
5,095.00 4,465.00
Mar ' 07
4,089.00 3,737.00
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Mar ' 06
Mar ' 05
2,801.00 2,175.57 2,498.00 1,850.27
Per share ratios
Mar ' 09
Mar ' 08
Adjusted EPS (Rs) 108.08 78.06 Dividend per share 23.5 33.25
Mar ' 07
Mar ' 06
Mar ' 05
65.42 11.5
90.65 45
68.38 11.5
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PROFITABILITY - INFOSYS TECHNOLOGIES LTD (INFY)
Return on Assets Industry Comparison
18.61%
Return on Capital Industry Comparison
21.73%
Return on Equity Industry Comparison
32.07%
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ASSET TURNOVER - INFOSYS TECHNOLOGIES LTD (INFY)
Total Assets Turnover Industry Comparison
1.0
Fixed Assets Turnover Industry Comparison
4.8
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Cash flow statements (Rs Crore) Profit before tax
Mar ' 09 6,714.00
Mar ' 08 5,100.00
Mar ' 07 4,129.00
Mar ' 06 2,724.00
Mar ' 05 2,184.49
Net cashflow-operating activity
5,152.00
3,816.00
3,256.00
2,237.00
1,359.70
Net cash used in investing activity
-195.00
-978.00
-1,065.00
-392.00
-939.88
Netcash used in fin. activity
-2,430.00
-777.00
-316.00
244.00
-580.10
Net inc/dec in cash and equivlnt
2,600.00
2,079.00
1,871.00
2,096.00
-156.32
Cash and equivalnt begin of year
7,689.00
5,610.00
3,779.00
1,683.00
1,839.40
Cash and equivalnt end of year
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 operation +
Funds from financing +
Funds from 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 f'cast 10.09.09, 12:14 AM EDTINFOSYS/ (UPDATE 1) :UPDATE 1-Infosys Q2 profit up 7.5 pct, raises FY10 f'cast * Sees FY10 revenue falling 1.0-1.3 pct to $4.60-$4.62 bln * Sees FY10 EPS dropping 6.7-7.1 percent to $2.09-$2.10
• * Business climate improves, but currency volatility worrying (Adds details, company comments) BANGALORE, Oct 9 (Reuters) -Infosys Technologies Ltd ( INFY- news - people ) 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 CL-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 www.wondershare.com
Bibliography • • • •
http://www.infosys.com/investors/reports-filings/default.as http://en.wikipedia.org/wiki/Infosys http://finapps.forbes.com/finapps/jsp/finance/compinfo/Ra http://www.kamalsinha.com/iit/people/narayana-murthy/in
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Thank you
hank you !
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