Infy appoints Vishal Sikka as CEO & MD; stock gains ground

The stock has opened higher by nearly 3% at Rs 3,280 on the National Stock Exchange.

Infosys has opened higher by nearly 3% at Rs 3,280 on the NSE after the board has appointed former SAP executive Vishal Sikka as the Chief Executive Officer and Managing Director (CEO & MD) of the company. Sikka will take over from August 1, 2014.

The board of directors of the company has also elevated U B Pravin Rao, president and whole-time director, as the Chief Operating Officer, with effect from June 14, 2014, Infosys said in a statement.

Shashi Bhusan, analyst at Prabhudas Lilladher has recommended ‘buy’ rating on the stock with a target price of Rs 3,920.

"Infosys, if appoints Sikka as CEO, will be sending a strong signal to the market about their aspiration to be a global technology major and not just an Outsourcing vendor," he had said in a report dated June 2, 2014.

Adding: "However, if that happens, there are possibilities of few more exits in the company.  We  believe  the evolution  of  recent  technological  trends  definitely  mandate  Indian  IT Outsourcing vendors to take a lead in innovation. But, the transition is going to be a bumpy ride for Infosys."

The stock hit a high of Rs 3,297 and low of Rs 3,256 so far. A combined around 185,000 shares changed hands on the counter in early morning deals on the NSE and BSE. Meanwhile, the stock has rallied almost 10% in past three trading sessions from Rs 2,986 on June 9.