Infosys board of directors announced the selection of Dr Vishal Sikka as the chief executive officer and managing director (CEO & MD) of the company. Dr Sikka will be inducted as a whole-time director of the board and CEO & MD (designate) on June 14, 2014. He will take over as CEO & MD from S D Shibulal on Aug. 01, 2014.
Commenting on the same, Daljeet Singh Kohli, head of research, IndiaNivesh Securities said, ''In our view, announcement of new CEO could lead to restoration of investor confidence in to the stock for the time being. Additionally, this move would bring more clarity inside the organization on top management front. With a new top management in action, we could see better clarity emerging on sales strategy from here-on.''
''This is a positive development for Infosys as there have been a series of senior level exits in recent times. Also better strategic execution coupled with strong new management running the company comforts us that we could soon see Infosys reporting growth in line with industry over the medium-to-long-term,'' he added.
''At CMP of Rs 3,067, the stock is trading at 14.8x FY15E and 12.9x FY16E earnings estimates. Given the stable global environment, we are of the view that Infosys FY15 guidance is bit on the conservative side; hence we expect the upward revision in the guidance going ahead. We have BUY on the stock with target price to Rs 3,952 (valuing at 16.4x FY16E EPS),'' he opined.
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