The "Infoscions" are leaving to lead rival tech companies

Another technology services company saw a top level exit on Monday. Infosys CFO Nilanjan Roy quit last evening, with his resignation taking effect on March 31, 2024.

Deputy CFO Jayesh Sanghrajka will take over starting the new financial year on April 1. In response, the US-listed shares of Infosys ended 2.8% lower overnight.

This is the 10th major exit under CEO Salil Parekh's second term at the helm of Infosys. In May last year, Salil Parekh received an extension as the MD & CEO of Infosys until March 31, 2027.

Since October last year, Infosys has seen exits of major top level personnel like Ravi Kumar, Mohit Joshi, both of whom were Presidents of their verticals, K Gopikrishnan, SVP & Head, ERD, Richard Lobo, EVP & Head, HR, Narasimha Rao, EVP and head of Cloud & Infra among others.

In contrast, Salil Parekh's first term, which began in January 2018 saw fewer exits compared to this one.

Some of the top management personnel that quit Infosys have gone on to lead competitor companies.

Interestingly, Ravi Kumar, Mohit Joshi, and Kapil Jain were all appointed as CEOs in smaller organizations— Cognizant, Tech Mahindra, and eClerx, respectively.

Brokerage firm Morgan Stanley believes that the resignation of Roy as CFO was unanticipated and could weigh on the stock sentiment in light of the past senior exits. However, it expects the transition to be a smooth one.

Morgan Stanley remains overweight on Infosys with a price target of ₹1,600.

Brokerage firm Kotak, in a note dated October 12, wrote that while senior level departures are common, the surprising element is the bunching up of exits. The brokerage further writes that the company has a good leadership bench strength.

The two aspects to watch, according to Kotak, are some senior leaders that departed recently may tap into the Infosys talent pool and the impact on the existing business due to the departure of key leaders holding key accounts.

Out of the 45 analysts that track Infosys, 21 of them continue to have a "buy" recommendation on the stock, 16 have a "hold" rating, while eight have a "sell" call.

At the company's 42nd AGM on June 28 this year, MD & CEO Salil Parekh said that group of leaders that Infosys has produced over the years through its own leadership development and through the work they do with clients in Delivery, in markets, really prepares them to do more and more work.

"And we have made sure that those leaders step up and take that on. We feel good about the fact that we have such a deep leadership bench, and we will continue to work on that as we go ahead," he added.

Shares of Infosys are off the day's low but are down 0.3% at ₹1,483.25. For the year, the stock is down 1.7%.