Infosys stock up 3% on appointment of CEO

Shares of Infosys today settled with gains of nearly 3 per cent on the bourses after the appointment of the new CEO and MD Salil Parekh.

On December 2, Infosys said it has appointed Parekh as its CEO and Managing Director, concluding the three-month high-profile executive search at the country's second largest IT firm.

During the day, the company opened on a bullish note at Rs 983.00 then gained further ground and surged 4.01 per cent to touch an intra-day high of Rs 996.95 on the BSE. The stock however pared some gains and finally ended the day at Rs 985.30, up 2.80 per cent.

Oearly high the stock opened at Rs 980, then surged to an early-high of Rs 996.80, registering a jump of 3.96 per cent over its previous closing price. At the end of today's trading session, the stock was quoted at Rs 984.40, up 2.67 per cent.

Market analysts believe the uptick in the counter was largely because the appointment of CEO reduces succession planning uncertainty in the counter.

"The CEO appointment is faster than our expectation and reduces the uncertainty on succession planning at Infosys," Japanese brokerage firm Nomura said in a research note.

It further added that the current CEO designate has experience across a wide range of areas consulting, application services, cloud infrastructure services, integrating large acquisitions (Kanbay/iGATE) and scaling up the offshore delivery base of Capgemini to more than 100K people currently.

The Bengaluru-based firm had initiated the executive search after CEO Vishal Sikka resigned in August following a protracted acrimony between the management and the founders.

UB Pravin Rao, who was filling in the CEO role on an interim basis, will now continue as Chief Operating Officer and a whole-time director of the company, Infosys said in a statement.

Parekh, who will take over his role at Infosys on January 2, 2018 for a period of five years, was a member of the Group Executive Board at French firm Capgemini.