Credit Suisse said,
Will this make a difference? We think this move will make a positive difference with customers. Impact on employee morale would depend on next steps. While NRN’s visionary leadership in the past is unarguable, it would be naive to believe that this move will be a panacea for all of the company’s current problems. Price Target 2700
BNP Paribas said,
Murthy’s return positive, but expect no miraclesInfosys (INFO IN, HOLD, TP: INR2,400, CP: INR2,404) announced over the weekend that founder NR Narayana Murthy will return as Executive Chairman of the company. We believe investors are likely to see the step as reassuring given the recent volatile results, and the stock could react positively, at least in the near term. But we note the jury is still is out on whether Mr. Murthy’s return will be able to address Infosys’s growth and margin challenges, which we believe are further complicated by the proposed immigration reform in the US. We also believe the development raises several other questions, which we list below.
Goldman Sachs has set a price target of Rs 2308 with the following views,
We think the return of NRN (INFY’s founder) to an executive role after 7 years may boost long-term investors’ confidence in the company. Under his leadership, INFY had set industry benchmarks such as being the first firm to offer employee stock options, list on the NASDAQ, report quarterly financials, issue guidance, and walk away from its top client to avoid pricing cuts. However, given lower IT growth and a more intense competitive landscape, we will wait to see how INFY changes its strategy to return to a growth path. We continue to believe that INFY’s earnings visibility will remain poor in the near term as it faces growth/margin trade-off amid modest IT spending
More Stock recommendations on Infosys is Available here,
http://www.dalalstreet.biz/earningsnews/2013/06/murthys-return-to-infosys-what-are-analysts-recommendations/
