Speculations over Nandan Nilekani's return to Infosys head gave a positive indication to market, as shares of the company registered a spike of 2.4 percent on Wednesday afternoon. At 1.15 pm, the shares were trading at 895.65, up 2.11 percent.
According to CNBC TV18, the former CEO and Managing Director of Infosys is likely to make a comeback. The TV channel quoted a source as saying that Nilekani's role would be "cleared" in the next 48 hours.
The stock of India's second largest software services exporter had plunged as much as 18 percent in two successive sessions, following the exit of CEO and MD Vishal Sikka on August 18.
In the process, it eroded over Rs 33,914.71 crore of the firm's market capitalisation, leaving investors and institutions alike worried. The promoters of the company also lost around Rs 4,320.70 crore after Monday's trade, with co-founder N R Narayana Murthy losing the most.
Earlier today leading Domestic Institutional Investors (DIIs) wrote a letter to Infosys board to bring back former co-founder Nandan Nilekani on the company's board.
The letter signed by 12 investors from mutual fund houses and insurance companies mentioned that Nilekani would be the right person to facilitate "resolution" to the ongoing issues between the board and the management. "In our opinion, he enjoys the confidence of various stakeholders viz, customers, shareholders and employees," the letter stated.
In the latest development former Infosys Chief Financial Offficer (CFO) V Balakrishnan preferred bringing back Nandan Nilekani as chairman of the company. To justify he said, his experience and understanding of clientele made him a "good face" to lead the organisation in the current situation, PTI reported.
Balakrishnan argued that considering the current situation, the chairpersons should step down Nilekani should come in as the chairman and try to identify a good CEO. Currently, the chairman's position is co-chaired by industry veteran R Seshasayee and Ravi Venkatesan should step down.
Balakrishnan's annotations came at an interesting time when clamour to bring back Nilekani is growing in various quarters, making it an impending one.
What's driving Nilekani return?
Nilekani served the company as CEO and MD between 2002 and 2007. During his five-year tenure as CEO, Infosys' topline grew six-fold to $3 billion. Aadhaar is Nilekani's brainchild. As the chairman of Unique Identification Authority of India (UIDAI), he rolled out India's biggest tech project. Since he is one of the founders of Infosys, he can convince the belligerent founders if they object to any radical measures to be brought in by the new CEO.
Need of the hour
During this turmoil, Nilekani appears to be the only saviour to rescue the IT major because he knows the company inside out. Besides having enormous knowledge on the company's business, landscape, people and culture, he knows the limitations as well. This makes him the best candidate to take the top job and reconstruct the board.
Nilekani can deal with Murthy
The company board blamed co-founder Narayana Murthy for Sikka's exit. Last Friday, the board stated in a statement that "Mr. Murthy's continuous assault, including this latest letter, is the primary reason why the CEO Dr. Vishal Sikka has resigned despite strong Board support." Murthy will most likely continue with his tirade in future. Hence, it's only Nilekani who can manage him.