In these challenging times of layoffs, Infosys, the country’s second-largest IT company, has offered a wonderful gift to its employees.
Eligible employees who have contributed to the company’s growth have been allotted a significant number of shares.
The allotment of these shares falls under the Stock Incentive Compensation Plan 2015 and Stock Ownership Program 2019.
According to the exchange filing, on May 12, 2023, 5,11,862 equity shares were allocated to deserving employees.
This gesture from Infosys comes as a significant gift for its employees, especially in the midst of continuous layoffs across the tech industry.
Shares Allotted under the Compensation Plan:
As part of the Stock Incentive Compensation Plan, Infosys has granted 1,04,335 equity shares.
Additionally, 4,07,527 shares have been allotted under the Stock Ownership Program.
In the last quarter of the financial year 2022-23, ending in March, the company achieved a consolidated profit of Rs 6,128 crore, marking a 7.8% annual increase.
Profit Decline and Competitors:
However, Infosys’ profit was lower than expected, with a decrease compared to the previous quarter.
In the December quarter, the company had earned a profit of Rs 6,586 crore.
As a competitor of Tata Consultancy Services, Wipro, and other IT companies, Infosys faced challenges in maintaining its profitability.
Reasons behind Share Distribution:
While Infosys shares closed at Rs 1,258.40 on Monday, witnessing a 1.06% increase, there has been a recent decline in the company’s share prices.
In the midst of ongoing job cuts in the IT industry, Infosys aims to engage and retain its top employees by providing them with share allotments.
This scheme motivates employees to perform better and align with the company’s growth objectives.
Impact of March Quarter Results:
Following the announcement of the March quarter results, Infosys shares experienced an 11% drop, reaching a 52-week low.
The company’s earnings in the January to March quarter fell below expectations. Experts attribute this decline to the banking crisis in America.
The Importance of BFSI and Challenges Faced:
The Banking Financial Services and Insurance (BFSI) segment holds significant importance for the IT sector, including Infosys.
The American banking crisis has adversely affected this sector, given that America generates substantial revenue for Infosys.
The company’s BFSI segment underperformed due to its high exposure to the crisis.
By distributing shares to its employees, Infosys aims to show appreciation and provide incentives for their continued contribution to the company’s success.
Despite facing challenges in profitability and the impact of external factors, Infosys remains committed to supporting and empowering its workforce.
No one will admit it openly but we think at least a small portion of layoffs only happened because of A.I. There were jobs which required humans earlier but now can be done using AI Chat bots.
Nevertheless, this move from Infosys increases trust among employees. Infosys has always been transparent with their employees. In the last quarter of the financial year 2022-23, ending in March, the company achieved a consolidated profit of Rs 6,128 crore, marking a 7.8% annual increase.
This share allocation had a positive effect in market as well. As we already discussed, share prices surged with the announcement.
Are you an Infosys Employees? Have you got shares as part of allocation?
Let us know in comments below