Infosys Ltd, the market leader because of its openness, is now facing issues regarding that self-same quality that made it a success. It is also the second largest Indian company in terms of revenue.
The IT services outsource firm was the standard for providing revenue and earnings guidance for itself. Oftentimes, those guidance was achieved and exceeded by the company's performance. The company was an exception rather than the rule, as many others in the market often lacked this corporate transparency and market guidance information.
In the few times that the company missed its forecasts, resulting in violent stock movements that peaked with a 21% fall on the day the most recent earnings report was released. This has made many question the wisdom of providing market guidance and forecasts.
The latest results released included a new growth forecast that was well under current expectations. The one day share value loss was the largest in ten years for Infosys, which is based out of Bangalore.
Just three months ago, a strong December performance led to a 17% jump in share values for the day and raised hopes for the company's return to glory. Infosys's growth has been lagging compared to its competition because of current struggles in the implementation of a strategic revamp in the company compounded by the economic difficulties for clients located in North America and Europe.
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