Infosys in the limelight

Undoubtedly, the stock in news today is Infosys. After a long time, there is news of someone  joining the company and not an exit. Though the stock has given a muted reaction to the appointment of a new CEO; the stock is just above 1% at Rs.3210 though it had opened much higher at Rs.3276, going on to hit an intra day high at Rs.3298.

The company announced today morning that it is appointing Vishal Sikka, an ‘outsider’ as CEO of Infosys, a former SAP AG executive board member. Sikka will take over from current Chief Executive S.D. Shibulal.

Executive Chairman N.R. Narayana Murthy and Executive Vice Chairman S. Gopalakrishnan would step down on June 14. Murthy will be designated as chairman emeritus from October 11.  Rohan Murthy would leave the company on Saturday, when the company would hold its AGM in Bangalore.

The rise in the stock price is not as sharp as the reaction it gives to an exit. Maybe the market is apprehensive about a new entrant and the leaving of Narayana Murthy and his son, Rohan.  And some analysts have voiced concern that Sikka being an ‘outsider’ there might be some more exits and this top management restructuring would take some time to settle down and start yielding results.