Infosys curtails business class travel for senior executives

BANGALORE: Infosys will curtail business-class travel privileges of its senior executives as part of its plans to cut costs amid a tough demand environment for India’s second-largest information technology services company.

“The tough economic environment demands that we periodically review our cost structure to drive optimization across board. Business class is a privilege available to senior leaders in the company for long haul travel. In our drive to optimize travel costs, the senior leadership has decided to lead by example and forego this privilege,” Infosys said in an email response to ET NOW.

In the three-months to September 30, Infosys spent Rs 382 crore in travel costs. For the six-month period it was, Rs 753 crore.

The cost-cutting was required to meet additional expenses that the company is incurring on account of recently announced wage hikes, the $7-billion company said.

Once known as India’s IT bellwether, Infosys has been struggling to grow in line with peers over the past few quarters. The company has said that it expects to grow at 5% during the on-going financial year as against the 11-14% growth projection for the outsourcing industry from industry body Nasscom.

Rivals Tata Consultancy Services and HCL Technologies have far outpaced the Bangalore-based company in sales growth.

In April this year, Infosys was the only large Indian IT company that did not give out a compensation hike to its approximately 160,000 employees citing a weak growth environment. However, during the September quarter earnings last month the company said it would raise salaries of its employees by 6%-8% effective from October.