Infosys shares rise on securing $454 mn deal from Danske Bank

Shares of Infosys remained in focus on Monday after the country’s second-largest software exporter informed exchanges that it has won a $454-million deal for the digital transformation of Denmark’s Danske Bank. As part of the deal, Infosys will acquire Danske Bank’s IT center in India, where over 1,400 professionals are employed.

The tenure of the contract is 5 years, with an option to renew for one additional year for a maximum of three times. The deal is expected to be completed before Q2 FY24, subject to customary closing conditions.

Snapping three sessions losing streak, Infosys shares opened marginally higher at ₹1,268.05 against Friday’s closing price of ₹1,265.65 on the BSE. In the first two hours of trade so far, the IT heavyweight gained as much as 0.6% to ₹1,273, while the market capitalisation climbed to ₹5.26 lakh crore. On the volume front, 1 lakh shares changed hands over the counter on the BSE compared with two-week average volume of 3.94 lakh stocks.

Infosys' share price trades 5% higher than its 52-week low of ₹1,215.45 on April 25, 2023, and 24% higher than its 52-week high of ₹1,672.45 on December 1, 2022. The blue-chip stock has delivered a negative return of 14% in a year, while it has lost 15.5% in a six-month period. In the last month, the IT stock has fallen nearly 4%, and 2% in a week.

The stock witnessed some buying on Monday after the Bengaluru-headquartered company said in an exchange filing that it has signed a strategic collaboration with Danske Bank, a leading Nordic Bank, to accelerate the bank’s digital transformation initiatives with speed and scale.

“This collaboration will help Danske Bank achieve its strategic priorities towards better customer experiences, operational excellence, and a modernized technology landscape, powered by next-gen solutions,” Infosys said in a BSE filing.

Headquartered in Denmark, Danske Bank provides banking services to personal and business customers, as well as large corporate and institutional customers. In a bid to accelerate the bank’s technology transformation, optimise its access to talent and capabilities and improve productivity, Danske Bank chose Infosys as its strategic partner.

“We are delighted to bring our rich experience in financial services transformation to work for Danske Bank and help the bank accelerate its strategic growth agenda. Infosys will collaborate with Danske Bank to strengthen its core business with greater digital, cloud and data capabilities. This will help Danske Bank create more value for their customers using powerful advances in AI, including generative AI,” says Salil Parekh, CEO & MD, Infosys.

With its global expertise and industry solutions, Infosys will accelerate the bank’s digital agenda by significantly enhancing its IT operations and capabilities, powered by Infosys Topaz, an AI-first set of services, solutions and platforms, experience design, and services that support operations, the company said.

Infosys has acquired BASE Life Science in Denmark and Fluido in Finland and recently opened a new proximity center in Gothenburg, Sweden, and Oslo, Norway. With this relationship with Danske Bank, Infosys has further enhanced its localisation strategy in the Nordics.

(DISCLAIMER: The views and opinions expressed by investment experts on fortuneindia.com are either their own or of their organisations, but not necessarily that of fortuneindia.com and its editorial team. Readers are advised to consult certified experts before taking investment decisions.)