Infosys Announces Major Hiring Spree Amid Impressive Q1 Financial Performance
Infosys to Hire 20,000 Fresh Graduates in FY 2024-2025
Infosys Ltd, India’s leading IT giant, has announced a significant recruitment drive, planning to hire between 15,000 to 20,000 fresh college graduates in the financial year 2024-2025. This move comes as part of the company’s strategy to bolster its workforce in alignment with anticipated growth, despite a challenging job market.
Impressive Financial Performance in Q1
In the April-June quarter of 2024, Infosys reported a net profit of ₹6,368 crore, marking a 7.1% increase compared to ₹5,945 crore in the same period the previous year. This robust performance was driven by the company’s diverse services and strong client trust, resulting in a notable revenue increase of 3.6% to ₹39,315 crore from ₹37,933 crore in Q1FY24.
Revenue and Margin Growth
Infosys raised its revenue growth forecast for the current fiscal year to 3-4%, up from the earlier projection of 1-3%. The company’s operating margin for the reviewed quarter stood at 21.1%, with expectations to maintain margins between 20-22% for the entire fiscal year.
Major Contract Wins
The company’s focus on generative AI services has paid off, securing substantial contracts in the first quarter. Infosys CEO and MD Salil Parekh highlighted the company’s capabilities through its Topaz and Cobalt platforms, leading to orders worth $4.1 billion (approximately ₹34,000 crore) in the June quarter alone. This success is expected to continue throughout the year.
Sector-Wise Performance
The financial services segment, which contributes significantly to Infosys’s revenue, saw a slight dip of 0.3% to 27.5%. The retail segment also experienced a 3% decline, settling at 13.8%. However, the communications sector grew by 5.4% to 12.1%, and the energy, utilities, resources, and services segment rose by 6.3% to 13.3%. Revenue from North America decreased by 1.2%, while European revenue increased by 9.1%.
Employee Headcount and Utilization
Despite a consistent decline in employee numbers over the past six quarters, Infosys plans to ramp up hiring significantly. CFO Jayesh Sanghrajka confirmed the company’s intention to recruit 15,000 to 20,000 fresh graduates through both on-campus and off-campus selections. The company also successfully onboarded all previously offered candidates. However, the total headcount reduced by 1,908 employees in the June quarter, bringing the total to 315,332, a decrease of 20,962 from the previous fiscal year. Employee utilization improved from 78.9% to 83.9%.
Stock Market Reaction
Infosys shares closed at ₹1,759.15 on the Bombay Stock Exchange (BSE), reflecting a 1.93% increase following the announcement of the financial results and the hiring spree.
Infosys’s Stance on Karnataka Employment Bill
Responding to the Karnataka state government’s temporary suspension of a bill mandating higher employment quotas for locals in private companies, Infosys CEO Salil Parekh assured compliance with all government regulations and guidelines. He emphasized the company’s commitment to adhering to both state and central government policies. The bill stipulates that private companies must reserve 50% of managerial roles and 70% of non-managerial positions for locals.
Controversy and Industry Reactions
The bill has sparked debate within the industry. PhonePe CEO Sameer Nigam voiced his opposition, citing his diverse upbringing across various Indian states and questioning the bill’s impact on local employment opportunities for his children. Infosys, maintaining its stance on regulatory compliance, continues to navigate these policy challenges while focusing on growth and expansion.
Conclusion
Infosys’s proactive hiring strategy and strong financial performance highlight its resilience and adaptability in a dynamic market. By investing in fresh talent and leveraging its technological capabilities, Infosys aims to sustain its growth trajectory and maintain its position as a leading global IT services provider.
