CEO of Infosys, Vishal Sikka resigns from his post citing personal attacks. He also resigned from the post of MD but will remain the executive Vice Chairman. Here is a detailed analysis of his resignation and its implications.
Details of the Infosys Story
CEO and MD of Infosys, Vishal Sikka surprised everyone as he announced his resignation from Infosys. He said in his blog which he posted today that he was attacked by those who he feels should have supported him. From last few months, co-founder of Infosys, Mr. Murthy was not happy with Sikka amid his role in the Infosys. There had been three complaints from independent directors of the company that Mr. Sikka was more of a Technical officer rather than a CEO. They also added that he was even irregular with check and balances which is must in such a reputed company.
— Vishal Sikka (@vsikka) August 18, 2017
Implications of Vishal Sikka’s Resignation
In hours after the resignation of Vishal Sikka, Investors in Infosys lost Rupees 26, 000 crores and the stock fell by 10.8%. This is the worst case for Infosys in the last 4 years. The stock that closed yesterday with a market cap of 2,29,285 crore today fell down to 2, 12,030 crore. The stock price fell to a record low of Rs923, creating an uncertainty in the mind of the investors.
Experts say that since the resignation of Mr. Sikka, there is a bit of insecurity amongst the investors; leading to the fall in the market value. If the crisis and controversy continues for a while then it will have a huge impact on the market of Infosys, the second largest IT export company of India.
Tumultuous Times for Indian IT Sector
The TATA- Mistry controversy, Donald Trump’s stand on H1B visa issue and now CEO Sikka’s resignation, Indian IT sector is in its critical time. There has already been a tough time for IT aspirants because of job layoffs and now falling share prices of Infosys has landed the industry into trouble. The near future also is in bleak as many other countries including Australia have gone strict on Indian IT professionals recruitment. Let us hope that things get well very soon.