Infosys says board member Srinivas resigns

Wed May 28, 2014 9:07pm IST

Employees of software company Infosys walk past Infosys logos at their campus in the Electronic City area in Bangalore September 4, 2012. REUTERS/Vivek Prakash/Files

Employees of software company Infosys walk past Infosys logos at their campus in the Electronic City area in Bangalore September 4, 2012.

Credit: Reuters/Vivek Prakash/Files

Related Topics

Stocks

   

REUTERS - Infosys Ltd president and board member B.G. Srinivas, seen by some investors as a candidate to take over as CEO, has resigned, becoming the latest senior manager to leave India's second-largest software services exporter.

Infosys did not give a reason for his resignation in its statement to stock exchanges. Srinivas, who joined in 1999, will remain in his role until June 10.

Infosys started a search for Chief Executive S.D. Shibulal's successor in April. Shibulal, one of company's seven founders, wants to retire in January 2015 or before, if his successor is ready to take over.

The company, part of India's more than $100 billion outsourcing services sector, has said that it would consider both external and internal candidates for the role.

The possibility of Infosys recruiting a CEO from outside, breaking with its tradition of choosing its chief executive from its founders, has gone up after Srinivas' resignation, analysts and investors said.

"The fact that he has left the company indicates he was no longer in the running for the top job," said Bhavin Shah, CEO of brokerage Equirus Capital. "He was a key person from a client interaction perspective, so it's a big loss for the company."

Srinivas' resignation follows the departure of at least nine senior executives who left since the company brought founder N.R. Narayana Murthy back from retirement to help revive its fortunes in June last year.

Infosys, once a showpiece for India's outsourcing industry, is losing its status as the employer of choice for young IT workers, with staff leaving at an unprecedented pace as the company struggles to regain ground lost to rivals.

Shibulal is one of seven engineers who launched the company in 1981 by pooling together $250, mostly borrowed from their spouses. He is the fourth person from the group to become CEO, and will be the last.

"With Srinivas' resignation, there are not too many high-profile candidates left in Infosys who can replace Shibulal," said Walter Rossini, a fund manager for Gestielle India, which owns Indian shares, including Infosys, worth about $150 million.

"An outsider as a chief executive, who will change the management mentality and bring in a different approach, could be a game changer for Infosys. This is what the company needs."

Infosys' shares in New York were down 3.4 percent at 1530 GMT. The company's India stock ended up 1.3 percent ahead of the announcement on Wednesday, while the main market index closed flat.

(Reporting by Sumeet Chatterjee, editing by Louise Heavens; Editing by Subhranshu Sahu and Louise Heavens)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

Trade Deal

REUTERS SHOWCASE

Record High

Record High

Nifty hits record high on foreign buying, higher Asian stocks.  Full Article 

Bullish on Equities

Bullish on Equities

Bullish on Indian equities, but gains seen 'less sharp'- Goldman Sachs  Full Article 

Facebook Results

Facebook Results

Second quarter revenue increases 61 percent  Full Article 

BRICS Bank

BRICS Bank

World Bank chief welcomes new BRICS development bank.  Full Article 

Streamlining Operations

Jet Streamlines

Jet Airways chairman says looking to restructure debts, talking to bankers  Full Article 

Political Economy

Political Economy

Analysis - Watch what markets don't do as world politics turns nasty   Full Article 

Photo

Honda's India Thrust

Honda's India unit to account for 25 pct of Asia Pacific sales by March 2017 - exec   Full Article 

 Boosting Output

Boosting Output

NMDC plans to boost iron ore output by two-thirds  Full Article 

Apple Results

Apple Results

Apple margin concerns fade, focus shifts to iPhone launch  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage