For the first time, Infosys will not flag off the results season, a possible acknowledgement that the company is taking a workman-like approach to get back to its bellwether status, which it has conceded to TCS.

Infy takes backseat

India’s number one software exporter TCS will flag off the fourth quarter results, which is also the last for the 2014-15 financial year, on April 16, ahead of Infosys (whose results will be announced on April 24 in Chennai). Cross town rival Wipro is expected to announce its results on April 21-22, according to a filing with the BSE.

Every quarter investors used to look towards the Infosys management, which pretty much determined the health of the IT and business optimism in other sectors as well.

“Quarter after quarter Infy set the tone for the sign of things to come. Maybe this is their way of saying that we prefer to be the underdog,” said a consultant from a ‘Big 4’ accounting firm on condition of anonymity as he consults one of the larger IT exporters.

Another former Infoscion who heads an IT company in Bengaluru agreed and added that this is a clear indication that Infosys has conceded the leadership position to TCS.

However, according to company sources, the delay has been attributed to the new CEO Vishal Sikka requiring more time to articulate his new strategy for financial year 2016. Some analysts believe that companies review some part of their strategy and this falls in line with that kind of thinking. “Every company revisits the way they communicate with the stakeholders periodically,” said Sanjoy Sen, Doctoral Researcher at Aston Business School. Others believe that the mantle of bellwether is now truly on TCS, with a pretty consistent showing in every quarter. This is also indicated by the fact that an investor, who has invested in the stock of TCS in 2012 while it was trading at ₹1,178, has seen his return soar by 115 per cent as of today, according to data from stock exchanges. Whereas the same investor, who invested in Infosys in 2012 when the company’s stock was trading at ₹1,404, has seen his returns go up by only 54 per cent.

CEO’s new approach

However, Infosys, under CEO Vishal Sikka is taking a new approach in outsourcing by training employees in SMAC and other technologies and wants the company to work in a start-up-like fashion.

Other analysts don’t read too much into this development as Infosys still has EBIT margins in the range of 26 per cent, which hovers close to that TCS. “Infosys has indicated it needs more time to growth,” said Sarabjit Kour Nangra, IT analyst with Angel Broking. While analysts believe that the sector will grow, the top tier IT companies are expected to grow in the range of 9-13 per cent.

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