MUMBAI Dec 20 A top executive at Indian IT
services group Infosys who was seen as a candidate to
become the next chief executive, has resigned, the latest such
departure since co-founder Narayana Murthy returned as executive
Infosys said on Friday that V. Balakrishnan, the head of
several units including business process outsourcing, has
resigned and would leave at the end of the month.
Balakrishnan, widely tipped by analysts to become chief
executive at India's second-biggest software services exporter,
told TV channel ET Now that his decision to resign was not
sudden and he wanted to pursue other interests, including
potentially in private equity.
The departure sparked concern among some analysts of
management disarray in a company, which brought back founder and
former chairman Murthy in June after disappointing results and a
loss of market share.
"This exit is in line with the several senior-level
departures seen in the firm, which indicates that senior leaders
do not see a clear strategic direction, and that the firm
struggles to find its feet in terms of what it wants to do in
strategy," said Ankur Rudra, an analyst with Ambit Capital in
"The negative impact of every senior level departure is an
avalanche, which snowballs into several mid-management
executives finding it difficult to stay in the firm."
Murthy's return has been applauded by investors, with the
share price rising about 50 percent so far this year to a record
high, as its profit outlook is expected to improve on the back
of stronger global demand and a weak rupee.
However, Murthy's return has also been followed by the
departure of several executives, including its Americas head and
global manufacturing chief, Ashok Vemuri.
Balakrishnan has the highest profile among those to leave,
having previously served as chief financial officer and heading
key units at the company, including consultancy Infosys
Analysts were uncertain about the reasons behind the of
departures, but said it was bound to worry investors.
Since his return Murthy has repeatedly said he will take
tough decisions to restore the company's fortunes over the next
three years and refocus it on winning large outsourcing
"Given the management changes at the beginning of the year
we did expect some changes at the top level. Some exits
surprised and some did not. We need to watch the company a
little more closely as having seen a fairly good number of
people already leaving," said IV Subramaniam, chief investment
officer at Quantum Asset Management, which holds about $1.7
million worth of Infosys stock.
"Infosys has always focused on creating a strong pipleline
of leaders. This allows us to deliver on our clients and
business commitments without any disruption," said a
spokeswoman for the company.
(Editing by Rafael Nam and Greg Mahlich)