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Infosys (INFY) Rides on Increased Digitization, Partnerships

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Infosys (INFY - Free Report) is benefiting from an encouraging demand environment as customers are undergoing a major digital transformation. Moreover, the company’s continued focus on acquisitions and partnerships is helping enhance its product offerings and expand across newer markets.

Growth in Digital Business: A Key Positive

Solid demand for Infosys’ digital services as well as its cloud, Internet of Things (IoT), security and data analytics solutions is a key growth driver. The company benefits from higher investments by clients in digital transformation across workplaces. This has accelerated amid the pandemic-induced remote-working environment.

The coronavirus mayhem is boosting the digital transformation market. Per a Grand view research report, the global digital transformation market size is projected to see a CAGR of 23.6% from 2021 to 2028 and reach $1,759.4 billion.

Notably, the company’s digital revenues, which contributed 48.5% to the total revenues, grew 31.3% year over year (29.4% at cc) to $6.58 billion in fiscal 2021.

Infosys has been attempting to reinforce its digital-transformation capabilities for expanding and solidifying the firm’s position in the highly competitive environment. The company is enabling its clients across more than 45 countries to create and execute strategies for their digital transformation.

We note that Infosys is looking to build a strong team of digital specialists in order to cater to clients across all verticals, whose key theme is digital transformation. Reportedly, Infosys has built solutions, driven by AI and machine learning, to digitize the data supply chain.

Enhancing Partnerships

The company has been fortifying its core competencies by pursuing collaborations and acquisitions. Its alliance strategy is targeted at teaming up with leading technology providers, which allows it to cash in on the emerging technologies in a mutually advantageous and cost-competitive manner.

In order to boost digital, cloud, legacy modernization and automation business, Infosys cemented strategic tie-ups with Google, Adobe, Microsoft (MSFT - Free Report) , Amazon Web Services and salesforce.com.

We believe such efforts in the digital-transformation business will boost the company’s position to compete with its rivals like Accenture (ACN - Free Report) and Cognizant (CTSH - Free Report) .

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