Infosys attrition rises to 15%, likely to continue in next two quarters: COO Pravin Rao

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Bengaluru-based IT major Infosys saw its attrition rise to 15 percent in the March quarter and expects this to continue in the next two quarters in a strong demand environment.

The company reported an attrition rate of 10 percent for the quarter ending December 2020. The company’s attrition rate on average was about 13-15 percent and in the March quarter it was on the higher end, Infosys COO UB Pravin Rao said during the earnings call on April 14.

“Attrition has picked up, largely reflecting a strong demand environment. Given this, we expect the attrition to remain at this level for the next one or two quarters,” Rao said.

The company, however, is confident that the employee engagement initiatives, vast talent pool and training capabilities will ensure seamless execution. “We have a compelling value proposition and can sustain at this level,” Rao added.

To contain attrition, the company is looking at a second round of compensation in July 2021 after the wage hikes it rolled out in January 2021. “We have a lot of focus on continuous learning and career advancement opportunities. We will look at any intervention required in between,” Rao added.

This is in contrast to its peer TCS, which reported an all-time low attrition rate of 7.2 percent. TCS rolled out hikes effective April 1, 2021.

CEO Salil Parekh had at earlier in an event said that there was war for talent, a theme characterising the tech landscape in 2021. According to him, Infosys, over the years, has been good at basic training of freshers, which it recruited in large numbers.

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“Some other peers are not doing that sort of training and in many ways, it is an easy way for people to look within Infosys,” Parekh has said.

During the earnings call on April 14, the Infosys CEO said to ensure execution, huge recruitment was happening from campuses and laterally.

The company reported a 2.3 percent sequential decline in consolidated profit at Rs 5,076 crore for the quarter ended March 2021. Consolidated revenue from operations grew by 1.5 percent sequentially to Rs 26,311 crore

It reported dollar revenue of $3,613 million, up 13 percent year-on-year for the quarter ending March 31, 2021. Digital revenues accounted for about 51 percent of the revenues.

The company has approved share buyback of up to Rs 9,200 crore at a maximum price of Rs 1,750 per share, and recommended a dividend of Rs 15 per share for FY21.