Infosys chief executive officer S.D. Shibulal on Friday denied allegations of United States visa fraud by the company, saying that it has in the past taken disciplinary action, including dismissal, whenever violations have been reported.
“There has never been any policy or scheme to circumvent the B1 programme, we have always adhered to the highest level of corporate governance, legal and ethical ways of running a business," he said.
Infosys is facing a lawsuit in the US, based on the testimony of a whistleblower employee, over alleged violation of US visa rules. On Thursday, CBS news channel reported the story ,which could have repercussions for the Indian IT services giant, given the upcoming US Presidential elections in November, and increasing protectionist rhetoric from candidates.
“We have 145, 000 people who travel to 30 different countries, and as per our policies each of them are required to comply with the law, with our policies and with our procedures ” Shibulal pointed out.
“As and when we have heard of any kind of violation, we have taken very strict,action, including very strict disciplinary action, including dismissal.”
Read: Complete text of Infosys' response to CBS' visa fraud story
On the business side, Shibulal said Europe would continue to be an investment for the company, even as it had seen multiple ramp-downs, or loss of business, in the United States.
“We took a strategic decision to invest into Germany, France, Switzerland, and Netherlands” he said. “The percentage of revenue from there is quite small but (it is) paying off. “
As for the US market, he said that some anticipated ramp-ups did not take place, while there were some ramp-downs.
In the financial services sector, which is a large part of its business, Shibulal said profits have been going up for those firms, but there has not been much growth.
When profit goes up, spending on technology also goes up, but “that linkage been broken,” he said.
Shibulal also defended Infosys guidance policy, saying that giving guidance was never an issue and that the company will continue to do so.
“At this point, we are continuing the practice,” he told NDTV Profit.
“We have done so in the past, we debated it, but it was not an issue whether to continue the practice or not,” he added.
Rajiv Bansal, vice president and head of finance, said Infosys would likely only see 0-1 per cent revenue growth in the June quarter but was likely to see an average of 4-5 per cent growth for the next three quarters that would translate into 8-10 per cent annual growth. (Read: Why Infosys guidance matters)
“Hiring on-site, that cost is coming up in Q1,” he said, off the low guidance for the June quarter. Overall, there is a plus-minus one per cent margin in the guidance, Bansal said, adding that there could be a 0.8 per cent drop in margins in fiscal 2013. Infosys will hire 35,000 people in fiscal 2013, including 1,200 in the US.
“We have about 65 per cent visibility for the next fiscal,” Shibulal said, referring to the projection for the next year. “If things change, it could go up, but our parameters (for guidance) have not changed.”