Infosys reported strong numbers for the June quarter and sounded cheerful in its commentary, in the process firing up investor appetite for frontline IT stocks in general. Among the highlights of Infosys' quarterly performance was a large deal--estimated to be around $1.5 billion-- from US financial services major Vanguard.

Given so much gloom all around, can this performance sustain? That is the question many in the market is asking.

Infosys MD &CEO Salil Parekh's answer to that is the strong deal pipeline, particularly in sectors like hi-tech manufacturing and financial services.

"Some of the strategic choices we made a few years ago are starting to show good results," Parekh told CNBC-TV18 in an exclusive interview, his first since the outbreak of the COVID pandemic.

"One of them was a very strong focus on digital and cloud and it so happens that during this crisis, many large enterprises have actually accelerated digital and cloud spends," he said.

Infosys' digital business grew 25 percent during the first quarter, compared to the same period last year. Parekh said there has been good progress on large digital deals with clients.

He said nearly the entire Infosys workforce is now equipped to work out of anywhere.

"We did this with extreme speed. So the supply side issue was not an issue for us," he said.

Large deals

Speaking about large deals, Parekh said these were not predictable.

"They are more volatile in that sense; however we have been fortunate.," he said, adding, "looking ahead we will see some of these large transformational deals again in areas like hi-tech manufacturing and financial services."

And while it would be difficult to predict when the deals would materialise and in which sector, Parekh said that the more important thing was to have the groundwork in place.

"The thinking for us is to prepare a foundation which allows us to be participating and when these opportunities come up, if we are ready for it we will be fortunate to win those. The pipeline is strong," Parekh said, adding that the company was having discussions with clients on large deals.

Pricing

Parekh said that barring a few clients in sectors like retail and manufacturing, most clients have not asked for discounts.

"What we noticed in Q1FY21 was some small number of instances where we had this pricing discussions, especially in retail and manufacturing. It is not at this stage widespread or a discussion across all sectors," Parekh said.

"It also depends on how the global situation evolves. We have seen a lot of fiscal stimulus and support from governments around the world. In the end, it will depend on what the medical situation is. At this stage no other sectors (have asked for price cuts)," he said.

First Published:Jul 23, 2020 5:02 PM IST