Infy wants to make a pricing play supported by automation tools, platforms

We won't have compromise too much on margins, says COO Pravin Rao

Infosys on Thursday said its acquisition of new technologies and use of automation would improve productivity and make it more aggressive in pricing.

Speaking at the Morgan Stanley India summit in Mumbai, U B Pravin Rao, Infosys’ chief operating officer, said improved productivity would benefit margins and Infosys would look at passing some gains to clients. “On the application development and maintenance side, when you talk about large deals, there is a pressure on costs. So there is a lot of focus internally on automation, and using tools and technologies so that we can be aggressive in pricing,” Rao said.  

With the change of guard at the Bengaluru-based company, the management is laying emphasis on process improvement by entering new areas like digital, cloud, big data and analytics. Application development and infrastructure management services still constitute 34 per cent of Infosys’ overall revenue. During his second stint at Infosys, company founder N R Narayana Murthy said growth was flagging due to lack of focus on this part of the business.

Infosys has acquired automation technology provider Panaya and digital and mobile commerce solutions provider Skava in 2015. The company will use their technologies to improve service delivery and automate a large part of its work, including business process outsourcing, infrastructure management and applications maintenance.

 

“These are strategic buys to re-energise our portfolio,” said Rajiv Bansal, chief financial officer.

Chief Executive Officer Vishal Sikka’s strategy involves renewal of existing business and entering new areas. Sikka recently said many of his initiatives would start showing results in the second half of 2015.

Rao said the company was confident of achieving its revenue growth forecast of 10-12 per cent at constant currency in 2015-16. “Our pipeline is quite decent. We have not seen any increase in IT spending, but we see a fair amount of confidence among clients,” he added.

Infosys was also working at becoming a $20 billion revenue company by 2020, Rao said, adding significant growth would come from acquisitions of niche technology companies in automation, collaboration and design.