Infosys market cap falls by 24 per cent

This was followed by a downgrade last week by another foreign research firm, UBS Warburg, following Infosys’ third quarter Dec 2000 results. Though Infosys posted a hefty rise in its third quarter net profit to Rs 166.33 crore, UBS downgraded the stock from buy to hold.

‘‘The major concerns of UBS over Infosys are its high exposure to telecom start-ups with a lower telecom vertical exposure and falling net utilisation rates of employees to 77.6 per cent from 80.5 per cent in the second quarter. The Infosys scrip came under selling pressure for a better part of the last week. However, it staged a strong come-back late in the week. It rose 4.63 per cent to Rs 5,797.95 in a single trading session on January 12, 2000 on buying by funds,’’ says a study by Capital Market.

‘‘After Infosys saw a huge decline in market cap in the last one month, a tussle is on between the software major and the petrochemical major for the no. 3 market cap ranking. Reliance Industries has overtaken the software major on two occasions recently. Even as Infosys’ market cap has declined sharply on the bourses in the last one month, the Reliance market cap has remained more or less unchanged during the period under review,’’ it said.