Nandan Nilekani's return gives booster shot to Infosys stock

NEW DELHI: The Infosys stock on Monday saw a major turnaround as the IT behemoth's shares rose by 4.60 per cent in morning trade. It hit an intra day high of Rs 953.95 on the Nifty.
Monday's turnaround of the dwindling Infosys stock is being credited by the Street to Nandan Nilekani's return as chairman. Nilekani’s presence is expected to soothe the nerves of those within Infosys as well as the investor community.
"The sentiments have changed due to Nilekani's involvement in the Infosys board," said Sumeet Bagadia, Associate Director of Choice Broking.
Following feverish speculation, Infosys inducted Nilekani as the non-executive, non- independent chairman of the company, on Thursday evening after the markets had closed. The appointment was followed by high-level exits from the tech giant, as former CEO Vishal Sikka and directors Jeffery S Lehman and John Etchemendy resigned from the Infosys board with immediate effect. Chairman of the board R Seshasayee and co-chair Ravi Venkatesan also stepped down from the board.
However, the second largest software exporter of the country could manage to insulate itself from volatility in the stock due to an extended weekend.
Analysts opine that the Infosys stock is expected to stay rangebound as the search for a new CEO (Chief Executive Officer) continues.
"On the higher side, unless the stock crosses the Rs 1,000 barrier it is difficult to say that it has come out of the slump. Similarly, on the lower side, if the prices fall below Rs 870, it can fall upto 800-levels," Bagadia said.
One should wait for sometime before buying Infosys for a long term, the market expert advised.
Meanwhile, investors' wealth saw a boost of about Rs 9,000 crore on the back of Monday's surge. Incidentally, it had slumped by more than Rs 30,000 crore as the Infosys shares tanked by 15 per cent in two sessions after Vishal Sikka's resignation.
Nandan Nilekani was one of the Infosys' seven founders and served as the company's chief executive between 2002 and 2007.
On Monday, the Infosys shares were up 3.09 per cent at Rs 940.30 on the Nifty when the bourses closed compared to the broader market which gained half a per cent.