Outgoing Infy CFO Ranga says 'finance team is strong'

Outgoing Infy CFO Ranga says 'finance team is strong'

Adjudged as the best CFO in Asia in the technology sector for two consecutive years – 2017 and 2018, Ranga executed one of the largest and the most complex share buybacks in the Infosys’ history – worth $2 billion.

After working for 18 years with Infosys, its CFO MD Ranganath has decided to move on. Adjudged as the best CFO in Asia in the technology sector for two consecutive years – 2017 and 2018, Ranga executed one of the largest and the most complex share buybacks in the Infosys’ history – worth $2 billion. He is also credited with being architect of the company’s capital allocation policy and Advance Pricing Agreement (APA) with the US government, which he considers as his career highs at IT major. November 16 would be his last working day at the company. In a candid chat with Furquan Moharkan of DH, Ranganath, popularly known as Ranga, explains the journey he has had with the company. Excerpts:

After almost two decades at Infosys, you are moving out. How has been your journey?

Certainly, I have been very fortunate to have played multiple roles in the company and it gave me many opportunities. For example, I have played roles in strategy, finance, risk management, mergers and acquisitions, investor relations and consultation. It culminated in the role of Chief Finance Officer. It is really a privilege. At the same time, I was also integral part of the journey that the company took and there have been multiple highlights. I have had the privilege of working with all the CEOs of the company, and all the founders, as well. And from each of them, it has been a deep learning experience. The most satisfying has been CFO role itself. We kept a resolute focus on the financial performance over the past three years. For example, in fiscal year 2018 the cash flow was at the record high of $2 billion. Most importantly, I think, earning the respect of all stakeholders has been most satisfying thing. I am very glad that I am passing the baton of the finance team of the company that has very sound financial health.

You talked about working with all the CEOs of the company. With whom did you have the best equation?

I would say that it was good with everybody. I think each one brings a unique style, a unique perspective and a unique outlook. And I have learnt from each one of them. I have worked closely with Nandan (Nandan Nilekani) in last one year, when he came back as Chairman. Then when Murthy (NR Narayana Murthy) came back couple of years ago, I used to handle chairman’s office. And Shibu (SD Shibulal), has been my longest boss in the company. Likewise, I have worked with Kris Gopalakrishan, Vishal Sikka and Salil Parekh. I won’t say X is best or Y is best. That would be unfair.

Despite sectoral slowdown and internal controversies, Infosys managed to have higher growth than its competitors. What did you do differently?

It’s very clear that the strength of the company is not built in a day or so. It has been built over 37 years – whether its transparency, fiscal discipline, or it’s sharp focus on execution. It is not one or two people, but the whole management team that has worked towards it. The real strength of Infosys is in focus and execution. You referred to the financial growth. Yes over the last three years, while our revenues expanded by 26%, and our profitability was better than most of our peers. This comes from resolute focus on financial outcomes. At the same time, it also comes from very strong customer focus. If you look at our top clients, they have been with us for decades. That shows a deep level of client relationship, which is very important for us. Second is focus on execution and third fiscal discipline.

In the hindsight, what are your career highs and lows at Infosys?

If we look back at past 18 years, there are multiple moments of acceleration. In early 2000s, winning a small contract gave us lot of excitement. I was in domain consulting back then. But coming to the recent years, the excitement has been from how financial performance of the company has been resilient and strong. Talking about capital allocation policy, that was one of the largest and at the same time one of the most complex. We are listed in multiple countries and we had to navigate that. Because of that we earned a lot of respect of the shareholders, and it was done in such a way that it was equitable to all the shareholders – both Indian and foreign. And nothing gives more satisfaction to retain the customers in troughs and peaks, while delivering great financial performance. And the APA, which we signed with the US government is very unique. And there was also the real fun of working with some of the best and the brightest in the company. These were clearly some high points at the company.

Indian IT firms do see their valuation on the higher side. Did it bother you at any point of time?

The company’s valuation is primarily based on the expectations of the investors – of growth, of cash generation. There are always ups and downs, but the valuation is not static. It is purely based on the expectations on how the future cash flow and the prospects of the company are.

As you leave from the company, where do you think the company should look for your successor – internally or externally?

The finance team that we have was not built in three or five years span. The solid foundations were laid by TV Mohandas Pai, the former CFO, and then we built on it. We have a very strong finance team. I think the board has started the process of hunting for the new CFO, and will continue.

What is your next move?

I have been in a large globally listed corporation, having played multiple roles, there are unique perspectives, experiences on scaling. And as a CFO of the globally listed company, managing a complex scenario, whether it is volatile currency environment or delivering a very superior capital allocation. These are all unique experiences. I want to channelise all this in a meaningful manner to create an impact. So, I am looking forward to it.

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