Infosys’ deal momentum is steady and strong despite seasonality: Salil Parekh

 BENGALURU : Infosys Ltd’s deal momentum has been steady and strong during the third quarter ending in December, typically a seasonally weak quarter for IT companies, Salil Parekh, CEO & MD, said on Tuesday.

The December-ended quarter is considered a seasonally weak quarter due to the holiday season in key geographies such as the US and Europe.

“Many of the large deals are new digital transformation projects...while the decision-making process has progressed at about the same pace as in Q2, the intensity of connecting with clients has actually gone up with everyone working remotely using video platforms," said Parekh.

In July, Infosys won a multi-year digital transformation deal from US investment firm Vanguard. The deal, pegged at about $1.5 billion, is one of the largest ever for the company and an indication that digital technology spending is on the rise.

The company’s digital business has grown 25.4% since last year and contributed 47.3% to the revenue for the second quarter ended September. Parekh said the contribution could increase to 50% in the next few quarters.

The demand for digital offerings like cloud and cyber security which shot up during the pandemic, are critical areas of growth for Infosys.

As part of its strategy to accelerate the cloud business, Infosys launched Cobalt, its integrated cloud spanning services, solutions and platforms to help clients build cloud-first capabilities in a secure innovation-led environment.

To enable growth in its key areas, Infosys is also focussing on re-skilling employees in various digital areas.

“Learning is an extremely important area which becomes the foundation for all our employees who are building their future," Parekh said.

He said the pricing environment is stable as there is a “tremendous appetite" for investment in technology among clients, who are using digital technologies not just for process improvement but to drive growth. “As of now, we have not seen any unusual levels of pricing pressure."

From an industry perspective, Infosys chairman Nandan Nilekani said that “consumerisation of IT", which refers to the impact consumer-originated technologies can have on enterprises, has led to increased adoption of cloud, big data and artificial intelligence (AI), and cyber security among clients.

Once the covid-19 pandemic is over, Infosys will consider returning its employees to offices to build “social capital", Parekh said. However, the return-to-office model is likely to be a hybrid one and the flexibility of remote working is expected to continue.