Introduction

Infosys limited belonging to Forbes is one of the largest business groups across the globe. It serves
as a consultancy, software services, e-business, program management and supply chain solution.
The employees perform different functions such as application development, product co-
development, system implementation and system engineering. They target business sectors who
are specialized in insurance, banking, telecommunication and manufacturing sectors. They get
more information in this business sectors which are very useful to their sector. They have their
own motive on obtaining those information as it is of great use to their IT sector.
Infosys is the only Indian company and the first one to be registered in NASDAQ-100 index. By
doing so they serve as testimony to its competitive business model and leadership position in this
industry. The Managing Director of Infosys said that their inclusion in NASDAQ-100 not only
benefited them but had a recognition to the whole country.
The annual Revenue of the company reached from $100 million to $10 billion in 2017. Their
economic growth had reached to high level among all other IT sectors. Company’s 87% of revenue
were from North America, Europe and Asian countries especially from India. These countries
serve as a major source of income to IT and ITES sector.

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 Market capitalization of the company is $46.52 billion which set a benchmark for the
IT companies not only in India but across the globe. It is also noted that the market cap of Infosys
is more than the GDP of many countries. Infosys is ranked as #3 in 2019 Forbes as the World’s
Best Regarded Companies list.
As per 2020, the Number of employees in Infosys were 2,42,371 across Europe, America and
Asia. Out of which 37.8% were women. They give more importance to women empowerment in
their sector. The company won as Best Awards by the Association for Talent Development
(ATD). Apart from this they have won many awards and one among them were Best Platinum
Awards in two consecutive years.

ABSTRACT
The IT Revolution has initiated great change in India since independence. Implementation
of Information Technology(IT), created the need for software system globally. IT systems were
used in almost all the fields like educational institutions, hospitals, banks, railways, medical shops,
share markets and in various other sectors for their day to day activities. Due to their massive
development, many companies were emerged in India of which some of the supreme power
companies are Infosys, TCS, HCL Technologies and many others. IT technologies provide job
opportunities to many people especially to youngsters, job seekers and many more. The IT
companies provide services to government and provides employment to large number of people.
In this paper we have made an attempt to analyze the financial performance of one of the top most
IT company- Infosys. Infosys is an Indian MNC that serves the clients at global level through
consulting services, software development and business process outsourcing services. Infosys is
ranked at 10th position at the top10 IT companies of the world on the basis of revenue. Since it
foundation up to date they have a journey over 39 years, they provide global banking platform,
help in employment development especially for women. The work of employees was divided as
project works, software development, consultants and many other IT related works. An analysis
has been made to show the financial performance of the company for the last 5 years. The results
indicate a financial analysis of company’s Revenue and profit earnings. They grow faster in the
field of digital services at the global level.
KEYWORDS: Financial analysis, revenue earnings, profit earnings, Infosys.

BACKGROUND OF INFOSYS
Infosys was established in the year 1981 in the name of “Infosys Consultants Private Limited”.
They had become public limited company in the year 1992 and changed their name to “Infosys
Technologies Limited” which was again renamed in 2011 as “Infosys Limited”. Due to company’s
world-wide development in the IT and ITES sector they have reached certain top position not only
in business but also the in the minds of people

Profile of Infosys Company

is an Indian multinational information technology company that delivers business consulting,
information technology and expand services. The company was founded in 2 July 1981 (Pune) and
is headquartered in Bangalore, Karnataka, India.Infosys is the second-largest Indian IT company
after Tata Consultancy Services by 2020 revenue figures and the 602nd largest public company in
the world according to Forbes Global 2000 ranking. The credit rating of the company is CRISIL
AAA / Stable / CRISIL A1+ (rating by CRISIL). Company traded in NSE, BSE, BSE Constituent
and NSE Nifty. Its Revenue in 2021 is Rs. 1,02,823 Crore, Operating income 26,823 crore, Net
Income 19,423 Crore, Total Assets 1,08,489 Crore, Total Equity 74,250 Crore and 2,59,619
employees working in Infosys Limited.
 Research Methodology
❖ Sample Selection: For the purpose of the study Infosys Limited has been selected ❖ Period of
Study: The study is conducted for a period of five financial years i.e. from 2017 to 2021. ❖ Data
Collection: The relevant data are collected from secondary resources. Data has been collected for
five years from the various sources: • Published Annual Reports of the Infosys Limited for the
financial year 2017 to 2021. • Websites of Infosys Limited • Other related websites like: •
http://profit.ndtv.com/stock/state-bank-of-india_sbin/financials-historical-cash-flow • Dion
Global Solutions Limited

Data Analysis
Current Ratio Current ratio is calculated by dividing current assets by current liabilities: Current
assets include cash and those assets that can be converted into cash within a year, such as
marketable securities, debtors, inventories, Short-term loans and advances. All the obligations
maturing within a year are included in current liabilities. Current Ratio = Current Assets / Current
Liabilities Current liabilities include creditors, bills payable, accrued expenses, short term bank
loan, income tax liability and long-term debt maturing in the current year.

PERIOD OF STUDY
The period for the financial performance analysis of the company is limited for 5 years ranging
from 2016-2020. The data have been taken for analyzing financial review of the company which
follows GAAP accounting method since its beginning.

OBJECTIVES
1. To analyse the financial Performance using comparative Balance Sheet.
2. To analyse the pattern of change of the Company.
3. To calculate the contribution of each year.

TOOLS USED
The following tools have been used to conclude the results for a better analyze the financial
performance of the company.
? Comparative balance sheet
? Trend analysis

REVIEW OF LITERATURE
Dr. S. Vijayalakshmi.et.al. (2017), in the article titled, “A study on Financial Performance Analysis
of Bharti Airtel Limited”, took a period of 5 years from 2011-2016 for the financial assessment of
the company selected. The financial tools employed to measure the financial position was ratio
analyzes. Under ratio analysis short term and long term ratios were used to see the liquidity,
profitability and stability level of the company. It can be concluded from the study that the liquidity
level of the company keeps on varying. Profitability of the company is not as good as the sales is
decreasing and income is also not stable. Bharti Airtel needs to improve their debt position also.

J.Pavithra..et.al. (2017) in paper titled, “ A study on the analysis of the Financial Performance
with Reference to Jeppiar Cements Pvt. Ltd. The period of the study was taken
for 5 years from 2009-2013. Comparative financial statements, ratio and trend analysis was

employed to study the financial position over the years. It was found that the debtor’s turnover
ratio had an increasing trend which is not considered a good sign for the company and
concluded overall profitability position to be good. The current ratio showed fluctuation but the
creditworthiness of the company was observed to be good.

Amalendu Bhunia et al. (2011), researched into the financial performance of some public sector
pharmaceutical and drug enterprises in India. The research was aimed at assessing both short and
long term solvency, profitability and liquidity trends, efficiency of financial processes and to
examine determinants of liquidity and profitability behaviours. To evaluate how the chosen ratios
jointly influence the financial position and profitability of the firms, the multiple regression
technique was used. The research sampled two public enterprises from the pharmaceutical and
drug sector that were listed on Bombay Stock Exchange. The performance indicators deployed
included solvency, profitability, efficiency, financial stability, operating efficiency and liquidity
ratios. It found that both companies had strong liquidity positions. Financial stability of the two
companies also demonstrated an increasingly declining trend. A notable gap in the study was the
complete reliance on published financial data. Thus, it’s prone to all the weaknesses inherent in
the summarized published financial statements.

Julius B.Adesina et al (2015) evaluated how the capital structure of quoted Nigerian banks relates
with their financial performances. Parameters used were profit before tax, equity and debt. The
survey research design was employed and data analysis was undertaken by deploying the Ordinary
Least Square (OLS) regression to capture the kind of the associations between the banks’ financial
performances and the corresponding capital structure. To filter out the banks in the top tier with
relatively high capital structure, stratified sampling was adopted for the study. This resulted in the
selection of the ten most capitalized banks. The annual reports of the sampled banks were
scrutinized and data on pretax profits, debt and equity for 2005 to 2012 period were extracted. The
research established a significant positive impact of equity and debt on financial performance of
the banks. The gap in the work is the exclusive reliance on OLS in a two variable regression
analysis, which may expose the model to technical flaws. The potential threat to the model is its
failure to capture the feedback effect of the variables of interest.

ANALYSIS AND
INTERPRETATION
COMPARATIVE BALANCE SHEET

The comparative balance sheet is a vertical form of balance sheet which represents both liabilities
and assets of the firm. Two consecutive year’s balance sheet data are taken and compared for the
better financial review. In the analysis the difference between firm’s financial position are shown
which are helped to take financial decision of the business. The analysis of Infosys shows their
expenditure and income for the year 2019-2020.

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 Table No.1 Comparative balance sheet
of Infosys

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INTERPRETATION
From the above Table no.1, it is inferred that during 2020 there has been an increase in the value
of total asset of Rs. 54,576 (in crores) long term liabilities to outsiders have creatively increased
by 4,678. (in crores). Equity share capital has decreased by Rs. 2,122(in crores). This fact indicates
that the policy of the company is to purchase fixed assets from the long term sources of finance.
The current assets increased by 54,576(in crores) i.e.,3.21% and cash has been decreased by
Rs.919 (in crores). The current liabilities increased by 20,856(in crores) i.e.,11.90%. This further
confirm that the company has used long term finances even for the current assets resulting into an
improvement in the liquidity position of the company. Reserves and surplus has been increased
from 62,551to 63,031 [i.e., 0.77%] which shows that the company has not any utilized reserves
and surplus for the payment of dividends to shareholders for the current year and kept as reserves.
Short term provisions have been decreased from 576 to 572 i.e., (0.69%) This shows that the
company has made more debts. But at the same time there has been decrease in capital work-in-
progress from 1,388 to 954 i.e., (31.27%). This means that the company have made few or less
construction works or any other processes during the year 2020. The expenses of the company is
reduced in this area.
The overall financial position of the company is satisfactory.

TREND ANALYSIS
The analysis and review of financial statements for two or more years is termed as Trend
Analysis. Generally, the financial statement such as Profit & Loss account and Balance Sheet are
taken for Trend Analysis.
It indicates the trend in different years which has been changing from year to year. From this
analysis the firm will study about the strength and weakness and they would plan to overcome
them in future. For the trend calculation of two years, it is calculated on the basis of previous years.
This analysis which is taken from the balance sheet are analyzed for 5 years, the first year is taken
as BASE year and the percentage of trend is calculated.

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 Table No.2
Trend Analysis

INTERPRETATION
From the chart No.1, it is inferred that the net worth of the firm has been decreased in the year
20117-2018 (111.72-105.15%) but it is increased in 2019 by 0.04% and it has been increased in
2020 (106) as shown in the chart. The total assets and net worth of the firm remained same. This
shows that the firm’s value is more in 2017.

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 Chart No.1

From the Chart No.2, it is inferred that the total liabilities in the trend also decreased in 2017-
2018 (111.72-105.15%) but it is increased in 2019 (105.19%) but that was an increase in 2020
(106%). This increase is due to minority interest of the company in 2019.

Chart No.2

From the Chart No.3, it is inferred that Gross block of the firm is decreased in 2017- 2018 but
increased in 2019. There was an great increase in 2020(177.53). It is because the firm did not
incur much cost in asset. It is shown in the chart. This shows an positive indicator on the
performance of the company.

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 Chart No.3

Chart No.3

From the Table No.2, it is inferred that the firm has more investment in the year 2017 when
compared to other years. It is because the firm worked on their old policies.
Net current asset has increased in (84.78%) in 2018.

FINDINGS AND CONCLUSIONS

? As per trend analysis(Table No.2), the values were decreased in 2019 and made an
increase in 2020
? The 5 years trend value depicts the company’s development and the financial changes
of the firm.
? Pattern of the firm remains almost same but there were technological changes every
year.
? Inspite of using loans and advances, they manage to keep their asset level utmost the
same.
? Market value of the firm were higher to cover the debts of firm.
? As per Comparative Balance sheet (Table No.1) The firm made more contribution
?
(capital) in 2019 when compared to the previous years.

REFERENCES
? Vijayalakshmi, S. et.al. 2017. A study on Financial Performance Analysis of Bharti Airtel
Limited. International Journal of Business Marketing and Management, 2(2), 27-
32.
? Pavithra, J. et.al. 2017. A study on the Analysis of Financial Performance with Reference
to Jeppiar Cements Pvt. Ltd. International Journal of Pure and Applied Mathematics,
116(14), 189-194.
? Amalendu Bhunia et al.2011 Financial Performance Analysis-A Case Study. Current
Research Journal of Social Sciences. 2011; 3(3): 269-275.
? Julius B. Adesina et al.2015 Capital Structure and Financial Performance in Nigeria.
International Journal of Business and Social Research. 2015; Volume 05, Issue 02
? www.moneycontrol.com
? www.investopedia.com
? www.accountingtools.com
? www.infosys.com