ABOUT INFOSYS

INTRODUCTION
Infosys Technologies is one of the few Indian companies that have changed the way the world look at India. No longer is India a land of snake charmers and beggars. It is now perceived as an economic giant to reckon with, bursting with brilliant software engineers and ambitious entrepreneurs. And Infosys is a symbol of India's information technology glory.

FIRST CREDITS
Infosys has many firsts to its name: The first Indian firm to list on Nasdaq, the first to offer stock options to its employees. The company crossed $1 billion in revenues for the first time in 2004. TCS, however, was the first Indian IT firm to top $1-bn in revenues. Infosys is an organisation that inspires awe and respect, globally. On July 2, Infosys completed 25 years in existence

HOW IT ALL STARTED

In 1981, it was Murthy's idea to start Infosys. Murthy had a dream, and no money. So Sudha gave him Rs10,000, which she had saved without his knowledge. Murthy and his six colleagues started Infosys in 1981. No, it was not in Bangalore, but in Pune that Infosys set up its first office, in 1981. The house that Murthy and Sudha bought with a loan became the first Infosys office. As Murthy ran Infosys, Sudha took up a job as a systems analyst with the Walchand Group of Industries to support their household. In 1983, Infosys moved to Bangalore when it got its first client, Data Basics Corporation from the United States. The first minicomputer arrived at Infosys in 1983. It was a Data General 32-bit MV8000. The very next year Infosys switched from mini to main frames with a CAMP application for a Data Basics customer. The first years of Infosys were not smooth. Most of the founders -- Murthy, Nilekani, Dinesh, Shibulal and Gopalkrishnan-were into writing codes. So Infosys got its first joint venture partners in Kurt Salmon Associates. Gopalakrishnan, who had spent time working in the United States, was the public face of the KSA-Infosys venture in America. But the joint venture collapsed in 1989, leaving Infosys in the lurch.

FINANCIAL STATEMENTS OF INFOSYS COMPANY

PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH 2013 2013 (IN RS CR) 36765 0.00 36765 25750 0.00 2012 (IN RS CR) 31254 0.00 31254 21193 0.00

GROSS SALES LESS EXCISE DUTY NET SALES OTHER EXPENSES LESS:EXPENSE, INCLUDED IN ABOVE ITEMS, CAPITALISED (+)OTHER INCOME (OPERATING) PROFIT BEFORE DEPRICIATION, INTEREST AND TAX-PBDIT DEPRICATION OPERATING PROFITOP/PBIT INTERST AND FINANCE CHARGES (+)OTHER INCOME (NON OPERATING) PROFIT BEFORE TAX AND EXTRA ORDINARY ITEMS PBTEOT EXTRA ORDINARY EXPENSES PROFIT BEFORE TAX-PBT TAX CORPORATE DIVIDENT TAX PROFIT AFTER TAX-PAT

2298

2313

13313

12374

956 12357 0.00 0.00 12357

794 11580 0.00 0.00 11580

0.00 12357 3241 403 8713

0.00 11580 3110 438 8032

BALANCE SHEET FOR THE YEAR ENDED 31ST MARCH 2013

LIABILITY SHARE CAPITAL RESERVES N SURPLUS LOANS(SECURED) LOANS(UNSECURED) CURRENT LIABILITY PROVISION CONTINGENT LIABILITY

2013 287 35772

2012 287 29470

0.00 0.00 3181 3788 1693

0.00 0.00 2454 3604 1024

ASSETS FIXED ASSETS CAPITAL WORK- IN PROGRESS INVESTMENT DEBTORS CASH AND BANK LOANS AND ADVANCES

2013 4453 1135

2012 4061 588

4344 6365 20401 6330

1409 5404 18057 6296

43028

35815

43028

35815

ANALYSIS OF BALANCE SHEET

Net sales growth by 44.8%. Increase in other expenses (51.73%) is higher than growth in net sales. Depreciation (29.19%) growth in operating profit (40%) is less than net sales. Tax provision has reduced by 29% in 2013 as compared to 2011. Net fixed asset increased by just 9.78% in 2013 as compared to 2011. Share capital has been constant. Capital work- in progress increased by 355.83% in 2013 as compared to 2011. Investment increased by 227.84% in 2013 as compared to 2011. Debtors increased by 51.12% in 2013 as compared to 2011. Net worth increased by 47.18% in 2013 as compared to 2011. Strong financial position.

TREND ANALYSIS OF INFOSYS

(IN RS CR) PARTICULARS 2011-2012 2012-2013

RESULTS FOR THE YEAR SALES AND OTHER INCOME INDEX PROFIT BEFORE DEPRECIATION INTEREST AND TAX INDEX PROFIT BEFORE TAX INDEX PROFIT AFTER TAX INDEX EQUITY DIVIDEND PER SHARE (TOTAL OUTLAY) INDEX DIVIDEND (%) POSITION AT THE YEAR END GROSS BLOCK INDEX NET BLOCK INDEX NET CURRENT ASSETS INDEX NET WORTH INDEX SHARE CAPITAL RESERVES AND SURPLUS BOOK VALUE (IN RS) NO. OF EMPLOYEES

33567 1.27 12374

39063 1.47 13313

1.29 11580 1.31 8032 1.37 2699 0.78

1.39 12357 1.4 8713 1.48 2412 0.7

4061 1.001 4061 1.001 23461 1.31

4453 1.1 4453 1.1 26766 1.5

287 29470 518.21 151237

287 35772 627.95 160227

ANALYSIS OF TREND ANALYSIS OF INFOSYS

Trend analysis is an indexed information from the year 2011 to 2013 (here 2011 is taken as a base year). Pbt growth always much lower than sales growth. The same applies to pat. Albeit there is a consistent rise in pat there is a significant decline in equity dividend per share. Pat has increased by 48% in 2013 as compared to 2011. Net block has increased by 9.8% in 2013 as compared to 2011. Share capital is constant from 2011 to 2013.

RATIO ANALYSIS

1. CURRENT RATIO = CURRENT ASSET / CURRENT LIABILITY 2013 CURRENT RATIO = 26766/ 3181 =8.4141 2012 CURRENT RATIO = 23461/2454 =9.56

Interpretation: The standard current ratio is 2:1. So we can say that current ratio of both
the years is satisfactory but, if seen from another viewpoint extra money are ideal and can be put in some other use.

2. LIQUID RATIO = LIQUID ASSETS / LIQUID LIABILITY LIQUID ASSETS = CURRENT ASSETS - (STOCK+PREPAIDEXPENSES) LIQUID LIABILITIES = CURRENT LIABILITY-BANK OVERDRAFT 2013 LIQUID RATIO = 26766/ 3181 =8.4141:1 2012 LIQUID RATIO = 23461/2454 =9.56:1

Interpretation: By liquid ratio we can say that company is solvent and has the capacity to
pay short term liabilities but, there is too much liquid money (cash) with the company, there is ideal wastage of money.

3. ACID TEST RATIO = QUICK ASSETS / LIQUID LIABILITIES 2013 ACID TEST RATIO = 20401/3181 = 6.41:1 2012 ACID TEST RATIO = 18057/2454 =7.36:1 Interpretation: The liquidity ratio is not good in 1st year compared to 2nd year.

4. DEBTORS RATIO = (DEBTORS+BILLS RECEIVABLE) / CREDIT SALES x 365 2013 DEBTORS RATIO (DAYS) =6365 X 365/36765 =63 DAYS 2012 DEBTORS RATIO (DAYS) =5404 X 365/31254 =63 DAYS

Interpretation: The standard debtors ratio is 35-40 days and we can see that the company
receives its payment which is almost double than the standard ratio i.e 63days which is not preferable.

5. FIXED ASSET TURNOVER RATIO = NET SALES / NET BLOCK OF FIXED ASSET 2013 FIXED ASSET TURNOVER RATIO = 36765/ 4453 =8.3 TIMES 2012 FIXED ASSET TURNOVER RATIO =31254/4061 =7.7 TIMES

Interpretation: The fixed-asset turnover ratio measures a company's ability to generate net
sales from fixed-asset investments - specifically property, plant and equipment-net of depreciation. A higher fixed-asset turnover ratio shows that the company has been more effective in using the investment in fixed assets to generate revenues.

6. NET WORTH TURNOVER RATIO = SHAREHOLDERS FUND OR NET WORTH 2013 NET WORTH TURNOVER RATIO = 36765/ 36059 =1.02 TIMES 2012 NET WORTH TURNOVER RATIO =31254/29757 =1.05 TIMES

NET

SALES

EQUITY

Interpretation: This ratio is of great importance to the present and prospective

shareholders as well as the management of the company. As the ratio reveals how well the resources of the firm are being used, higher the ratio, better are the results.

7. RETURN ON EQUITY SHARE HOLDERS FUND = (PAT-PREFERNCE DIVIDEND X 100) / EQUITY SHAREHOLDERS FUND PREFERENCE SHARE CAPITAL 2013 RETURN ON EQUITY SHARE HOLDERS FUND = 8713-0.00 X 100/ 36059 =24.16% 2012 RETURN ON EQUITY SHARE HOLDERS FUND =8032 X 100/29757 =26.99%

Interpretation: The return on equity share holders fund is not good in 1st year compared
to 2nd year.

8. EARNINGS PER SHARE = (PAT PREFERENCE DIVIDEND)/ NO. OF EQUITY SHARES 2013 EARNINGS PER SHARE = 8713/ 54.88 =158.75 2012 EARNINGS PER SHARE =8032 /54.45 =147.5

Interpretation: Earning per share is the portion of companys profit allocated to each
share; it is an indicator of companys profitability. Since it has increased in 2nd year, it is satisfactory.

9. PROPRIETORY RATIO = SHAREHOLDERS FUND / (TOTAL ASSETS MISC. EXPENSES) 2013 PROPRIETORY RATIO = 36059/43028 =0.84 2012 PROPRIETORY RATIO =29757/35815 =0.83

Interpretation: The higher the proprietory ratio depicts that business is running better
without less outside interference. Thus, we can say, the condition in both the years is satisfactory.

10. DEBTORS RATIO = DEBTORS / CREDIT SALES

2013 DEBTORS RATIO =6365/36765 =63 days 2012 DEBTORS RATIO =5404/31254 =63 days

Interpretation: If we compare with the standard ratio of 35-45 days the ratios are not that
satisfactory, but nothing can be said precisely in the absence of nature of goods.

11. GROSS PROFIT RATIO =GROSS PROFIT X 100/ NET SALES 2013 GROSS PROFIT RATIO =33796 X 100/ 36765 =91.9% 2012 GROSS PROFIT RATIO = 27307 X 100 /31254 =87.4%

Interpretation: Gross profit ratio in both the years is high and further increases in the 2nd
year hence they are satisfactory and appreciable.

12. NET PROFIT RATIO= NET PROFIT X 100/ NET SALES 2013 NET PROFIT RATIO = 9116 X 100/ 36765 = 24.8% 2012 NET PROFIT RATIO = 8470 X 100 /31254 = 27.1 %

Interpretation: The net profit ratio is not satisfactory in both the years as this is not
enough to declare dividend as well as to re-invest in business.

13. RETURN ON INVESTMENT = (NET PROFIT / EMPLOYED) X 100 2013 RETURN ON INVESTMENT =9116 X 100 /35772 =25.4% 2012 RETURN ON INVESTMENT = 8470 X 100 /29757 =28.5%

NET CAPITAL

Interpretation: Infosys has the capacity to pay to the stake holders (investors) interest
more than 20%

14. PRICE EARNING RATIO = MARKET PRICE OF SHARE / EARNINGS PER SHARE 2013 PRICE EARNING RATIO =1074/158.75 = 6.76 2012 PRICE EARNING RATIO =1056/147.5 =7.16

Interpretation: A valuation ratio of a company's current share price compared to its pershare earnings. Since it has decreased in 2nd year it is not satisfactory for Infosys as investors will hesitate in investing for Infosys shares.

15. DIVIDEND PAYOUT RATIO = DIVIDEND PER SHARE X 100 / EARNINGS PER SHARE 2013 DIVIDEND PAYOUT RATIO DIVIDEND PER SHARE = EQUITY DIVIDENT / NO OF SHARES =42 X 100/158.75 =26.46% 2012 DIVIDEND PAYOUT RATIO = 47 X 100/147.5 = 31.86%

Interpretation: It is the percentage of earnings paid to shareholders in dividends.as there

is a Reduction in dividends paid in the 2nd year it is being poorly looked upon by investors and hence is not appreciated.

CONCLUSION: As we can see that the ratios of the Infosys Company is good but some of the ratios can be improved in future by proper planning and its implementation. Thus, the financial position of the Infosys Company is good and can still get better in near future.