Infosys Ltd Management Discussions.

I. Industry structure and developments

Software and computing technology are transforming businesses in every industry around the world in a profound and fundamental way. Companies are rapidly adopting digital technologies to reimagine their cost structures, increase business resilience and agility, personalize experiences for their customers and employees, and launch new and disruptive products and services. While these trends have been unfolding for a few years now, they have been accelerated because of the COVID-19 pandemic and resulting shifts. Leveraging technologies and models of the digital era to both extend the value of existing investments and, in parallel, transform and future-proof businesses, is increasingly becoming a top strategic imperative for business leaders. From an IT perspective, the renewal translates to re-imagining human-machine interfaces, extracting value out of digitized data, building next-generation software applications and platforms, harnessing the efficiency of distributed cloud computing, modernizing legacy technology landscapes and strengthening information security and data privacy controls. The fast pace of technology change and the need for technology professionals who are highly skilled in both traditional and digital technology areas are driving businesses to rely on third parties to realize their business transformation. Several new technology solution and service providers have emerged over the years, offering different models for clients to consume their solution and service offerings, such as data analytics companies, software-as-a-service businesses, cloud platform providers, digital design boutiques, and specialty business process management firms.

While these developments present strong market opportunities for the IT industry, there is also an imperative need for IT services and solutions companies to transition from fast-commoditizing traditional service offerings, to attract and retain quality talent globally, to reimagine cost structures and leverage automation for increased productivity.

II. Opportunities and threats

Our strategy

Our clients and prospective clients are faced with transformative business opportunities due to advances in software and computing technology. These organizations are dealing with the challenge of having to reinvent their core offerings, processes and systems rapidly and position themselves as "digitally enabled". The journey to the digital future requires not just an understanding of new technologies and new ways of working, but a deep appreciation of existing technology landscapes, business processes and practices. Our_strategy is to be a navigator for our clients as they ideate, plan and execute on their journey to a digital future. In 2018, we embraced a four-pronged strategy to strengthen our relevance with clients and drive accelerated value creation:

1. Scale Agile Digital

2. Energize the core

3. Reskill our people

4. Expand localization

We believe the investments we have made, and continue to make, in our strategy will enable us to advise and help our clients as they tackle the current market conditions – especially in the areas of digitization of processes, migration to cloud-based technologies, workplace transformation, business model transformation, enhanced cybersecurity controls and optimizing cost structures in IT. Further, we have been able to successfully enable most of our employees worldwide to work remotely and securely – giving us the operational stability to deliver on client commitments and ensuring our own business continuity.

Over the last three years, we have executed on this strategy and generated significant outcomes as described further below. Scale Agile Digital: Our revenue from digital technology-related services and solutions have more than doubled in the last three years, and currently comprises 48.5% of our total revenue. We are rated as a "leader" in 48 industry analyst ratings across our digital offerings. These outcomes are a result of investments we have made to expand our digital footprint via reskilling of our employees, targeted acquisitions, strong ecosystem partnerships, innovation experience centers across the world, intellectual property development, reconfiguring our workspaces for agile software development and enhancing our brand.

Our human experience-related services expanded with the opening of 8 digital delivery centers, 6 digital studios and 12 proximity centers around the world. During the fiscal, we acquired Carter Digital to augment our human experience capabilities in Australia. Through our academia partnerships with Purdue, Trinity, RISD and eCornell, we have trained over 2,648 employees in niche digital skills.

Our Insight and data analytics services and solutions were further strengthened with the launch of our Infosys Applied AI solutions, coupled with the Infosys Data Workbench. With_advances in next-generation computing power, ready access to datasets on the cloud to train Machine Learning models and consumable Artificial Intelligence (AI) services, our solutions enable our clients to generate insights from their data and open opportunities for data monetization.

Our Innovate-related services and solutions are boosted by workspaces that have been specifically redesigned for agile software development, teams reskilled in agile methodologies, a large number of certified scrum masters and capabilities in horizontal technologies such as 5G, autonomous tech, product engineering, Internet of Things and blockchain. Our Accelerate-related services are aimed at rapidly transforming our clients legacy technology landscapes and processes with digital technology – helping them migrate to cloud environments, modernize mainframe applications, abstract legacy applications through APIs and embed open-source technologies in new applications. We invested in, and built strong partnerships with cloud hyperscalers such as AWS, GCP and Microsoft Azure, and SaaS providers. We launched Infosys CobaltTM, bringing together all our cloud investments – public cloud, private cloud, cloud applications, data on cloud, cloud security, etc. Infosys CobaltTM is a set of services, solutions and platforms for enterprises to accelerate their cloud journey. It offers over 14,000 cloud assets and over 200 industry cloud solution blueprints.

Our Automation and AI services grew on the back of our alliances with leading Robotic Process Automation (RPA) solution providers. We have automated over 20,000+ processes for our clients and have over 1,000 ready use cases across industries.

Our Assure services, in software testing and cybersecurity continued to grow with investments in Cyber Gaze, our cybersecurity dashboard and suite of related applications. Energize the core: Leveraging automation and AI, we are winning and executing several engagements for our clients to modernize their core legacy technology and process landscapes. We made significant investments in our "Live Enterprise" platform, including our Bot Factory of preconfigured automation bots and LEAP, our platform for optimizing large- scale application maintenance and reengineering. In fiscal 2021, we won a total contract value of over US$ 14 billion in large deals – more than four times what we won in fiscal 2018 – demonstrating our capabilities and competitiveness in executing complex transformation programs. In addition, investments in our own internal systems, reimagination of our internal processes and automation of software development processes have helped increase our agility, boost productivity and enhance our competitiveness even in the current paradigm of remote working.

Reskill our people: Continuous learning and reskilling has always been integral to our operating model. We operate our reskilling program with the twin objectives of increasing fulfillment of demand for digital skills in client projects and for enriching the expertise of our global workforce in next-generation technologies and methodologies. We_invested in, and scaled, our digital reskilling program globally. Our_in-house developed, anytime anywhere learning platform, Lex, offers over 1,800 courses curated for easy consumption on mobile devices with advanced telemetry, gamification and certification features. Over 2,40,000 of our employees use Lex and are spending approximately 45 minutes per day on average for learning activities. Expand localization: With the objective of creating differentiated talent pools and ecosystems in our markets, we made significant investments in expanding our local workforce in the US, the UK, Europe, Japan, China and Australia. We established innovation hubs, near-shore centers and digital design studios across geographies. Further, we expanded our university and community college partnerships in all these regions to aid internships, recruitment, training and joint research. In fiscal 2021, we recruited over 7,280 employees locally in our markets, of which 1,941 were fresh graduates. This workforce brings us greater diversity of skills and experience. This initiative also significantly de-risks our operations from regulatory changes related to immigration policies.

COVID-19

The COVID-19 pandemic is a global humanitarian and health crisis, that continues to impact all our stakeholders_– employees, clients, investors and communities we operate_in. Many countries are reporting the second and third waves of infections. The actions taken by various governments to contain the pandemic, such as closing of borders and lockdown restrictions, have resulted in significant disruption to people and businesses. While vaccines have been made available, there are delays in vaccinating larger populations, increased instances of variants and infections, and consequential stress on the healthcare sector. Consequently, market demand and supply chains have been affected.

In responding to this crisis, our primary objective has been to ensure the safety of our employees worldwide, to deliver our client commitments, and put in place mechanisms to protect the financial wellbeing of the Company, and protect its long-term prospects.

During the year, we launched several health and wellness programs for our employees covering various aspects of physical and emotional wellbeing, counselling support and awareness. In particular, together with health professionals and hospitals across our various locations, we offered COVID-19 related care for our employees and their families. Working closely with government authorities, we launched COVID-19 vaccination centers in our campuses and at select hospitals in India for eligible employees. For those employees working from our physical offices, we have established a safe work environment and protocols for testing and quarantine.

We are closely monitoring regulations and accordingly issuing travel advisories to our employees. We made arrangements to ensure the safety and wellbeing of our employees who have travelled for business to locations outside their home country and are currently restricted from travelling back.

At this time, a majority of our employees across the world continues to work remotely. As of March 31, 2021, we had enabled 99.3% of our employees with a secure remote working environment. As of March 31, 2021, 96.5% of our employees were working remotely. Employees engaged in critical client projects, business continuity operations and projects that manage sensitive client data continued to work from our offices. We enabled extensive use of collaboration platforms and continue to monitor the productivity of employees as they work remotely. We successfully conducted several client, partner and employee-related events online during the year.

We continued to optimize our cost structure and execute operational rigor. We improved liquidity and cash management with a rigorous focus on working capital cycles, capital expenditures and cost optimization.

A detailed description of specific risks arising from COVID-19 is available under "Outlook, risks and concerns" in this section.

Our strengths

We believe that we are well-positioned for the principal competitive factors in our business. With almost four decades of experience in managing the systems and workings of global enterprises, we believe we are uniquely positioned to help them steer through their digital transformation with our Digital Navigation Framework.

We offer end-to-end service offering capabilities in consulting, software application development, integration, maintenance, validation, enterprise system implementation, product engineering, infrastructure management and business process management. We have built specific industry domain and technology expertise, and in methodologies such as Design Thinking and agile software development. These give us the ability to articulate and demonstrate long-term value to our clients around the world, with whom we have deep, enduring and expansive relationships.

We have invested in building proprietary intellectual property in software platforms and products such as Infosys_ NIA, our flagship AI platform, the Edge suite of products, Finacle, McCamish and Stater that either amplify our own services or provide differentiated solutions for our clients business processes.

We have perfected sophisticated service delivery and quality control processes, standards and frameworks, that have resulted in a track record of performance excellence and client satisfaction. Our Global Delivery Model effectively integrates global and local execution capabilities to deliver high-quality, seamless, scalable and cost-effective services for large-scale outsourcing of technology projects fueled by automation, intelligence and collaboration technologies.

We have nurtured premier ecosystem alliances with enterprise software companies, cloud providers and innovative startup companies to be able to offer holistic solutions to our clients.

We have the ability to attract and retain high-quality management and technology professionals, and sales personnel globally and at scale.

Our internal research and development teams identify, develop and deploy new offerings leveraging next-generation technologies. We have invested extensively in the infrastructure and systems to enable learning and education across the enterprise at scale. These give us the ability to keep pace with ever-changing technology and how they apply to customer requirements.

We have a strong and well-recognized brand.

We have the financial strength to be able to invest in personnel and infrastructure to support the evolving demands of customers.

We maintain high ethical and corporate governance standards to ensure honest and professional business practices and protect the reputation of the Company and its customers.

Our competition

We experience intense competition in traditional services and see a rapidly-changing marketplace with new competitors in niche technology areas who are focused on agility, flexibility and innovation.

We typically compete with other large, global technology service providers in response to requests for proposals. Clients often cite our industry expertise, comprehensive end-to-end service capability and solutions, ability to scale, digital capabilities, established platforms, superior quality and process execution, distributed agile global delivery model, experienced management team, talented professionals and track record as reasons for awarding us contracts. In future, we expect intensified competition. In particular, we expect increased competition from firms that offer technology-based solutions to business problems, cloud providers and from firms incumbent in those market segments. Additionally, insourcing of technology services by the technology departments of our clients is another ongoing competitive threat.

III. Financial condition

The Company has considered the possible effects that may result from the pandemic relating to COVID-19 in the preparation of its financial statements, including the recoverability of carrying amounts of financial and non-financial assets. In_ developing the assumptions relating to possible future uncertainties in the global economic conditions because of this pandemic, the Company has, at the date of approval of its financial statements, used internal and external sources of information including credit reports and related information and economic forecasts and expects that the carrying amount of these assets will be recovered. The_impact of COVID-19 on the Companys financial statements may differ from that estimated as at the date of approval of its financial statements.

Sources of funds

1. Equity share capital

We have one class of shares – equity shares of par value Rs 5 each. Our authorized share capital is Rs 2,400 crore, divided into 480 crore equity shares of Rs 5 each. The issued, subscribed and paid-up capital is Rs 2,130 crore as at March_31, 2021 and Rs 2,129 crore as at March 31, 2020, including treasury shares held by a controlled trust. The movement in share capital is primarily on account of shares issued during the year on exercise of stock options.

Proposed share buyback

In line with the Capital Allocation Policy reviewed and approved on July 12, 2019, the Board, at its meeting held on April 14, 2021, approved the buyback of equity shares, through the open market route through the Indian stock exchanges, amounting to Rs 9,200 crore (Maximum Buyback Size, excluding buyback tax) at a price not exceeding Rs 1,750 per share (Maximum Buyback Price), subject to shareholders approval in the ensuing Annual General Meeting (AGM). Considering the proposed buyback and dividends for fiscal 2021, the Company would have returned approximately 83% of the free cash flow for fiscal 2020 and fiscal 2021 in line with the Capital Allocation Policy.

Share buyback in fiscal 2020

Based on the postal ballot that was concluded on March_12, 2019, the shareholders approved the buyback of equity shares through the open market route through Indian stock exchanges of up to Rs 8,260 crore at a price not exceeding Rs 800 per share. The buyback of equity shares though the stock exchanges was completed on August 26, 2019. The Company had purchased and extinguished a total of 11,05,19,266 equity shares at an average buyback price of Rs 747 per equity share.

Employee Stock Option Plans (ESOPs)

Infosys Expanded Stock Ownership Program 2019 ("the_2019 Plan")

On June 22, 2019, pursuant to the approval by the shareholders in the AGM, the Board was authorized to introduce, offer, issue and provide share-based incentives to eligible employees of the Company and its subsidiaries under the 2019 Plan. The maximum number of shares under the 2019 Plan shall not exceed 5,00,00,000 equity shares. To_ implement the 2019 Plan, up to 4,50,00,000 equity shares may be issued by way of secondary acquisition of shares by the Infosys Expanded Stock Ownership Trust. The Restricted Stock Units (RSUs) granted under the 2019 Plan shall vest based on the achievement of defined annual performance parameters as determined by the administrator (the_ nomination and remuneration committee). The_ performance parameters will be based on a combination of relative total shareholder return (TSR) against selected industry peers and certain broader market domestic and global indices and operating performance metrics of the Company as decided by the administrator. Each of the above performance parameters will be distinct for the purposes of calculation of the quantity of shares to vest based on performance. These instruments will generally vest between a minimum of one to a maximum of three years from the grant date.

2015 Stock Incentive Compensation Plan ("the 2015_Plan")

On March 31, 2016, pursuant to the approval by the shareholders through a postal ballot, the Board was authorized to introduce, offer, issue and allot share-based incentives to eligible employees of the Company and its subsidiaries under the 2015 Plan. The maximum number of shares under the 2015 Plan shall not exceed 2,40,38,883 equity shares (this includes 1,12,23,576 equity shares which are held by the Trust towards the 2011 RSU Plan ("the 2011 Plan") as at March 31, 2016). These_instruments will generally vest over a period of four years and the Company expects to grant the instruments under the 2015 Plan over the period of four to seven years. These RSUs and stock options shall be exercisable within the period as approved by the nomination and remuneration committee. The exercise price of the RSUs will be equal to the par value of the shares and the exercise price of the stock options would be the market price as on the date of the grant.

Consequent to the September 2018 bonus issue, all the then outstanding options granted under the stock option plan have been adjusted for bonus shares.

A controlled trust holds 1,55,14,732 and 1,82,39,356 shares as at March 31, 2021 and March 31, 2020, respectively, under the 2015 Plan. Out of these, 2,00,000 equity shares have been earmarked for welfare activities of employees as at March 31, 2021 and March 31, 2020, respectively.

The summary of grants made during fiscals 2021 and 2020 under the 2015 Plan and 2019 Plan is as follows:

2015 Plan Fiscal 2021 Fiscal 2020
RSU – Equity-settled 26,60,611 38,54,176
Incentive units – Cash-settled 1,15,250 6,56,140
Total grants 27,75,861 45,10,316
2019 Plan Fiscal 2021 Fiscal 2020
Total grants – Equity-settled RSU 15,96,408 20,91,293

For additional information on the Companys stock incentive compensation plans, refer to Note 2.11, ‘Employee stock option plan, of both the Standalone and Consolidated financial statements in this Annual Report.

2. Other equity

A. Reserves and surplus

Securities premium

On a standalone basis, the balance as at March 31, 2021 and March 31, 2020 amounted to Rs 581 crore and Rs 268 crore, respectively. On a consolidated basis, the balance was Rs 600 crore and Rs 282 crore as at March 31, 2021 and March 31, 2020, respectively. Increase in securities premium on both standalone and consolidated basis is mainly on account of transfer of Rs 260 crore from share options outstanding account upon exercise.

Retained earnings

On a standalone basis, the balance in retained earnings as at March 31, 2021 was Rs 57,518 crore after considering Rs 9,158 crore for final dividend for fiscal 2020 and interim dividend declared in fiscal 2021. Further, Rs 2,237 crore was transferred to the Special Economic Zone (SEZ) Re-investment Reserve net of utilization out of retained earnings during the year and Rs 1,554 crore was transferred to the general reserve on account of declaration of final dividend for fiscal 2020. The balance in retained earnings as at March 31, 2020 was Rs 52,419 crore after considering Rs 9,553 crore for final dividend for fiscal 2019 and interim dividend declared in fiscal 2020, including dividend distribution tax thereon. Also, Rs 4,717 crore was utilized from retained earnings for buyback of equity shares. Further, Rs 1,428 crore was transferred to the Special Economic Zone (SEZ) Re-investment Reserve net of utilization out of retained earnings during the year and Rs 1,470 crore was transferred to the general reserve on account of declaration of final dividend for fiscal 2019. On a consolidated basis, the balance in retained earnings as at March 31, 2021 was Rs 62,643 crore, as compared to Rs 56,309 crore in the previous year.

General reserve

During the year, an amount of Rs 1,554 crore was transferred to the general reserve from retained earnings on account of dividend appropriation, as compared to Rs 1,470 crore in the previous year. During fiscal 2020, an amount of Rs 1,494 crore was utilized for buyback of shares, Rs 11 crore was charged as transaction costs relating to buyback and Rs 50 crore was transferred to the Capital Redemption Reserve upon buyback in accordance with Section 69 of the Companies Act, 2013. On a standalone basis, the balance in general reserve as at March 31, 2021 amounted to Rs 1,663 crore (previous year Rs 106 crore). On a consolidated basis, the balance as at March 31, 2021 amounted to Rs 2,715 crore (previous year Rs 1,158 crore).

Share options outstanding account

On a standalone and consolidated basis, the share options outstanding account amounted to Rs 372 crore as at March_31, 2021, as compared to Rs 297 crore as at March 31, 2020. The movement is mainly on account of expense related to employee stock compensation expense, and impact of modification of share-based payment awards.

Special Economic Zone Re-investment Reserve

During the year, a net amount of Rs 2,237 crore and Rs 2,315 crore was transferred to the SEZ Re-investment Reserve net of utilization on a standalone and consolidated basis, respectively. This reserve has been created out of the profits of eligible SEZ units in terms of the provisions of Section 10AA(1)(ii) of the Income-tax Act, 1961. This reserve should be utilized by the Company for acquiring new plant and machinery for the purpose of its business in the terms of Section 10AA(2) of the Income-tax Act, 1961.

Capital reserve

On a standalone and consolidated basis, the balance as at March 31, 2021 amounted to Rs 54 crore, which is the same as the previous year.

Other reserves

Profit on transfer of business between entities under common control is taken to other reserve. During the year, Rs 176 crore was reduced on account of transaction under common control (refer to Note 2.4, ‘Investments, in the Standalone financial statements of this Annual Report for details of the business transfer). On a standalone basis, the balance as at March 31, 2021 and March 31, 2020 was Rs 2,906 crore and Rs 3,082 crore, respectively.

Capital Redemption Reserve

On a standalone and consolidated basis, the balance as at March 31,2021 amounted to Rs 111 crore, which is the same as the previous year.

B. Other comprehensive income

Equity instruments through other comprehensive income

On a standalone basis, there was an accumulated gain of Rs 169 crore and Rs 49 crore as at March 31, 2021 and March 31, 2020, respectively, on the fair valuation of equity instruments through other comprehensive income. On a consolidated basis, there was an accumulated gain of Rs 158 crore and Rs 39 crore as at March 31, 2021 and March 31, 2020, respectively, on the fair valuation of equity instruments through other comprehensive income. The Company has made an irrevocable election to present the subsequent changes in fair value of those instruments in other comprehensive income.

Effective portion of cash flow hedges

The Company designates certain foreign exchange forward and options contracts as cash flow hedges to mitigate the risk of foreign exchange exposure on highly probable forecast cash transactions.

When a derivative is designated as a cash flow hedge instrument, the effective portion of changes in the fair value of the derivative is recognized in other comprehensive income and accumulated in the cash flow hedging reserve, and is transferred to the Statement of Profit and Loss upon the occurrence of the related forecast transaction.

On a standalone and consolidated basis, the balance as at March 31, 2021 is a surplus of Rs 10 crore as compared to a deficit of Rs 15 crore, net of tax in the previous year.

Exchange differences on translating the financial statements of a foreign operation

On a consolidated basis, the balance as at March 31, 2021 amounted to Rs 1,331 crore, whereas the balance as at March_31, 2020 was Rs 1,207 crore.

Other items of other comprehensive income

Other items of other comprehensive income consist of remeasurement gains / losses on our defined benefit plans and fair value changes on investments, net of taxes.

On a standalone basis, there was a remeasurement gain, net of taxes, of Rs 148 crore during the current year, as compared to a remeasurement loss, net of taxes, of Rs 184 crore during the previous year. Additionally, there was a fair valuation loss on investments, net of taxes, of Rs 102 crore during the current year, as compared to a Rs 17 crore fair valuation gain on investments, net of taxes, during the previous year. On a consolidated basis, there was a remeasurement gain, net of taxes, of Rs 134 crore during the current year, as compared to a remeasurement loss, net of taxes, of Rs 180 crore during the previous year. Further, there was a fair valuation loss on investments, net of taxes, of Rs 102 crore during the current year, as compared to a Rs 22 crore fair valuation gain on investments, net of taxes, during the previous year.

Total equity attributable to equity holders of the Company

On a standalone basis, the total equity attributable to equity holders of the Company has increased to Rs 71,531 crore as at March 31, 2021, compared to Rs 62,234 crore as at March 31, 2020, primarily on account of profit earned during the year offset by dividends declared.

On a consolidated basis, the total equity attributable to equity holders of the Company has increased to Rs 76,351 crore as at March 31, 2021 from Rs 65,450 crore as at March_31, 2020. The movement was primarily on account of profit earned during the year offset by dividends declared. On a consolidated basis, the book value per share is Rs 180 as at March 31, 2021 compared to Rs 154 as at March 31, 2020.

Application of funds

3. Property, plant and equipment

Additions to gross block – standalone

During the year, additions to gross block were Rs 2,015 crore, comprising Rs 1,039 crore on infrastructure, Rs 975 crore in computer equipment and Rs 1 crore on vehicles. Our infrastructure investments comprised Rs 508 crore on buildings, Rs 113 crore on plant and machinery, Rs 82 crore to acquire 71 acres of land primarily in Bengaluru, Tumakuru and Hyderabad, Rs 92 crore on furniture and fixtures, Rs 110 crore on office equipment, and Rs 134 crore on leasehold improvements.

During the previous year, additions to gross block were

Rs 3,035 crore, comprising Rs 2,263 crore on infrastructure,

Rs 765 crore in computer equipment and Rs 7 crore on vehicles. Our infrastructure investments comprised Rs 968 crore on buildings, Rs 428 crore on plant and machinery, Rs 11 crore to acquire 105 acres of land primarily in the US (Indianapolis), Mysuru, Bengaluru and Mangaluru, Rs 427 crore on furniture and fixtures, Rs 159 crore on office equipment, and Rs 270 crore on leasehold improvements.

Additions to gross block – consolidated

During the year, additions to gross block were Rs 2,231 crore, comprising Rs 1,071 crore on infrastructure, Rs 1,159 crore in computer equipment and Rs 1 crore on vehicles. Our infrastructure investments comprised Rs 511 crore on buildings, Rs 117 crore on plant and equipment, Rs 82 crore to acquire 71 acres of land primarily in Bengaluru, Tumakuru and Hyderabad, Rs 91 crore on furniture and fixtures, Rs 118 crore on office equipment and Rs 152 crore on leasehold improvements. Additions through business combinations during the year were Rs 10 crore. During the previous year, additions to gross block were Rs 3,437 crore, comprising Rs 2,500 crore on infrastructure, Rs 930 crore in computer equipment and Rs 7 crore on vehicles. Our infrastructure investments comprised Rs 1,056 crore on buildings, Rs 475 crore on plant and equipment, Rs 11 crore to acquire 105 acres of land primarily in the US (Indianapolis), Mysuru, Bengaluru and Mangaluru, Rs 465 crore on furniture and fixtures, Rs 169 crore on office equipment and Rs 324 crore on leasehold improvements. Additions through business combinations during the year were Rs 78 crore.

Deductions to net block – standalone

During the year, we deducted Rs 14 crore from the net block on the disposal of various assets as against Rs 1 crore in the previous year. We have reclassified leasehold land with a gross block of Rs 561 crore to Right-of-Use (ROU) assets on account of adoption of Ind AS 116, Leases during the year ended March 31, 2020. Refer to Note 2.3 of the Standalone financial statements for further details.

Deductions to net block – consolidated

During the year, we deducted Rs 15 crore from the net block on the disposal of various assets as against Rs 1 crore in the previous year.

We have reclassified leasehold land with a net block of Rs 572 crore to ROU assets on account of the adoption of Ind AS 116, Leases during the year ended March 31, 2020. Refer to Note 2.19 of the Consolidated financial statements for further details.

Capital expenditure commitments

On a standalone basis, we have a capital expenditure commitment of Rs 609 crore as at March 31, 2021, as compared to Rs 1,305 crore as at March 31, 2020. On a consolidated basis, we have a capital expenditure commitment of Rs 733 crore as at March 31, 2021, as compared to Rs 1,365 crore as at March 31, 2020. The commitments are primarily for infrastructure facilities and computer equipment.

4. Goodwill and other intangible assets

On a consolidated basis, carrying value of goodwill as on March 31, 2021 is Rs 6,079 crore, which includes additions to goodwill amounting to Rs 758 crore on account of acquisition of Kaleidoscope, GuideVision, s.r.o. and Blue Acorn iCi and increase of Rs 35 crore on account of foreign currency translation. During the previous year, the carrying value of goodwill was Rs 5,286 crore.

On a standalone basis, carrying value of goodwill as on March_31, 2021 is Rs 167 crore, which included additions amounting to Rs 138 crore on account of business transfer agreement executed with its wholly-owned subsidiaries, Kallidus Inc. and Skava Systems Private Limited (together referred to as "Skava"). During the previous year, the carrying value of goodwill was Rs 29 crore On a consolidated basis, the carrying value of intangible assets as on March 31, 2021 is Rs 2,072 crore, whereas on March 31, 2020, it was Rs 1,900 crore. These primarily consist of intangible assets acquired through business combinations, stated at cost less accumulated amortization. Acquisition from business combinations for the year ended March 31, 2021 is

Rs 535 crore. Refer to Note 2.3.2 of the Consolidated financial statements for further details.

5. Financial assets

A. Investments Subsidiaries

During the year, we have invested additionally in our subsidiaries, for the purpose of acquisition of entities, operations and expansions.

Subsidiary In foreign currency In Rs crore
WongDoody Holding
Company Inc US$ 2.8 million 21
Infosys Nova Holdings
LLC US$ 177 million 1,302
Infosys Consulting Brazil BRL 110 million 154
Infosys China US$ 5 million 36

Investment in equity instruments of subsidiaries are carried at cost as per Ind AS 27, Separate Financial Statements.

Refer to Note 2.23 of the Standalone financial statements in this Annual Report for details on incorporation, liquidation and merger of subsidiaries.

On October 11, 2019, the Board of Directors of Infosys authorized the Company to execute a business transfer agreement and related documents with its wholly-owned subsidiaries, Kallidus Inc. and Skava Systems Private Limited (together referred to as "Skava"), to transfer the business of Skava to Infosys Limited for a consideration based on an independent valuation. On August 15, 2020, the Company entered into a business transfer agreement to transfer the business of Kallidus Inc. and Skava Systems Private Limited for a consideration of Rs 171 crore, and Rs 66 crore, respectively, on securing the requisite regulatory approvals. The transaction was between a holding company and a wholly-owned subsidiary and therefore was accounted for at carrying values and did not have any impact on the Consolidated financial statements. Subsequently on March 9, 2021, Kallidus Inc was liquidated. Further, on March 29, 2021, the shareholders of Skava have approved to voluntarily liquidate the affairs of the Company. Accordingly, Skava will complete the process of voluntary liquidation pursuant to Section 59 of the Insolvency and Bankruptcy Code of 2016 and applicable provisions of the Companies Act, 2013.

During the current year, the Company completed three business acquisitions through Infy Consulting Company Ltd (a wholly-owned subsidiary of Infosys Consulting Holding_AG) and Infosys Nova Holdings LLC (a wholly-owned subsidiary of Infosys Limited) to complement its digital offerings and end-to-end customer experience offerings to customers by acquiring 100% voting interests in: (i) GuideVision, s.r.o. a ServiceNow Elite Partner in Europe on October 1, 2020 (ii) Kaleidoscope Animations, Inc., a US-based product design and development services company focused primarily on medical devices on October 9, 2020 (iii) Beringer Commerce Inc. and Beringer Capital Digital Group Inc., collectively known as Blue Acorn iCi, an Adobe Platinum partner in the US, and a leader in digital customer experience, commerce and analytics on October 27, 2020 These acquisitions were made for a total consideration of

Rs 1,407 crore, comprising a cash consideration of Rs 1,307 crore and contingent consideration with an estimated fair value of Rs 100 crore as on the date of acquisition. Refer to Note 2.1 of the Consolidated financial statements for further details of these acquisitions.

Refer to Annexure 1 to the Boards report for the statement pursuant to Section 129(3) of the Companies Act, 2013 for the summary of the financial performance of our subsidiaries. The audited financial statements and related information of subsidiaries will be available on our website, at www.infosys.com.

Other investments

We invest in the startup ecosystem to gain access to innovation that, when combined with our services and solutions, can benefit our clients. These investments are typically minority equity positions in startup companies and / or venture capital funds. We have invested US$ 72 million to date in such assets since inception and we have an uncalled capital commitment of US$ 6 million. We have exited some of our investments either because the investee company was sold to new shareholders or because it ceased to have any further strategic value for us. The carrying value of investments as of March 31, 2021 was US$ 36 million. Our investments are fair valued in line with our accounting policies. As per Ind AS 109, Financial Instruments, all financial assets and liabilities are recognized at fair value on initial recognition, except for trade receivables which are initially measured at transaction price. Financial assets are subsequently measured at amortized cost, fair value through profit or loss or fair value through other comprehensive income as the case may be. For disclosures on financial assets including fair value hierarchy and financial risk management, refer to Note 2.10 of the Standalone financial statements and the Consolidated financial statements. Our investments comprise mutual funds, fixed maturity plan securities, tax-free bonds, non-convertible debentures, certificates of deposit, commercial paper and government securities. Certificates of deposit represent marketable securities of banks and eligible financial institutions for a specified time period and with a high credit rating by domestic credit rating agencies. Investments made in non-convertible debentures represent debt instruments issued by government-aided institutions and financial institutions with high credit rating. The majority of investments of the Company are fair valued based on Level 1 or Level 2 inputs. The_Company invests after considering counterparty risks based on multiple criteria including Tier I capital, capital adequacy ratio, credit rating, profitability, NPA levels and deposit base of banks and financial institutions. These risks are monitored regularly as per its risk management program.

B. Trade receivables

On a standalone basis, trade receivables amounted to Rs 16,394 crore and Rs 15,459 crore as of March 31, 2021 and March 31, 2020, respectively. On a consolidated basis, trade receivables amounted to Rs 19,294 crore and Rs 18,487 crore as of March 31, 2021 and March 31, 2020, respectively.

Revenues in excess of billings are referred to as unbilled revenue. Trade receivables and unbilled revenue are typically unsecured and are derived from revenue earned from customers primarily located in the US. On a consolidated basis, days sales outstanding was 71 days for the year ended March 31, 2021, compared to 69 days in the previous year. As per Ind AS 109, the Company uses the Expected Credit Loss (ECL) model to assess any required allowances; and uses a provision matrix to compute the ECL allowance for trade receivables and unbilled revenues. In_calculating ECL, we have also considered credit reports and other related credit information for our customers to estimate the probability of default in future and have taken into account estimates of possible effect from the COVID-19 pandemic.

The movement in ECL during fiscals 2021 and 2020 is as follows:

Particulars Standalone Consolidated
2021 2020 2021 2020
Opening balance 580 521 705 627
Impairment loss recognized 146 127 184 161
Amount written off Translation (106) (89) (123) (100)
difference (5) 21 (14) 17
Closing balance 615 580 752 705

C. Cash and cash equivalents

On a standalone basis, balance in current and deposit accounts stood at Rs 13,792 crore as at March 31, 2021, as compared to

Rs 8,048 crore as at March 31, 2020. Deposits with financial institutions stood at Rs 3,820 crore as at March_31, 2021, as compared to Rs 5,514 crore as at March 31, 2020.

On a consolidated basis, balance in current and deposit accounts stood at Rs 20,069 crore as at March 31, 2021, as compared to Rs 12,288 crore as at March 31, 2020. Deposits with financial institutions stood at Rs 4,645 crore as at March_31, 2021, as compared to Rs 6,361 crore as at March 31, 2020. On a standalone basis, we have a restricted cash balance of Rs 154 crore as at March 31, 2021 as compared to Rs 101 crore as at March 31, 2020 and on a consolidated basis, the same was Rs 504 crore as at March 31, 2021, as compared to Rs 396 crore as at March 31, 2020. These restrictions are primarily on account of bank balances held as margin money deposit against guarantees and cash balances held by irrevocable trusts controlled by us. The bank balances in India include both rupee accounts and foreign currency accounts. The bank balances in overseas accounts are maintained to meet the expenditure of the overseas operations and regulatory requirements.

Our cash and cash equivalents comprise deposits with banks and financial institutions with high credit ratings assigned by international and domestic credit-rating agencies which can be withdrawn at any point of time without prior notice or penalty on principal. Ratings are monitored periodically and the Company has considered the latest credit rating information to the extent available as at the date of approval of these financial statements.

D. Loans

The details of loans are as follows:

in Rs crore
Particulars Standalone Consolidated
2021 2020 2021 2020
Non-current
Loans to subsidiaries 277
Loans to employees 30 21 32 21
Current
Loans to subsidiaries 96 103
Loans to employees 133 204 159 239
Total 259 605 191 260

We provide personal loans and salary advances to employees. Of the total loans and advances of Rs 191 crore given to employees on a consolidated basis, Rs 159 crore is recoverable in 12 months.

Loans to subsidiaries as at March 31, 2021 includes Rs 21 crore to Infosys China and Rs 75 crore given to Infosys Shanghai. Asfiat March 31, 2020, loans to subsidiaries included Rs 277 crore to Infosys Consulting Pte Ltd, Rs 94 crore to Infosys China and Rs 9 crore given to Infosys Consulting S.R.L.

E. Other financial assets

The details of other financial assets are as follows:

Particulars Standalone Consolidated
2021 2020 2021 2020
Non-current
Security deposits 45 46 49 50
Rental deposits 164 169 217 221
Net investment in sub-lease of right-of-use asset 348 398 350 398
Restricted deposits 42 55
Unbilled revenues 11 399
Others 45 84 13
Current
Security deposits 1 1 6 8
Rental deposits 10 4 30 27
Restricted deposits 1,826 1,643 2,016 1,795
Unbilled revenues 2,139 1,973 3,173 2,796
Interest accrued but
not due 553 441 620 474
Particulars Standalone Consolidated
2021 2020 2021 2020
Foreign currency forward and options contracts 178 19 188 62
Net investment in sub-lease of right-of-use asset 37 35 38 35
Others(1) 482 282 339 260
Total 5,839 5,011 7,551 6,194

(1) Includes inter-company receivables of Rs 202 crore and Rs 93 crore for fiscal_2021 and 2020, respectively

Restricted deposits represent amounts deposited with financial institutions to settle employee-related obligations as and when they arise during the normal course of business. Unbilled revenues are classified as financial assets as right to consideration is unconditional and is due only after passage of time.

Interest accrued but not due has increased on account of increase in average investible base as compared to previous year, resulting in movement in accrued interest.

Foreign currency forward and options contracts are entered into to mitigate the risk of changes in exchange rates on foreign currency exposures. The counterparty for these contracts is generally a bank. These derivatives are measured at fair value through profit or loss and the resulting exchange gains or losses are included in other income.

6. Other assets

in Rs crore
Particulars Standalone Consolidated
2021 2020 2021 2020
Non-current
Capital advances 141 310 141 310
Defined benefit assets 9 143 19 151
Deferred contract cost 73 10 143 101
Prepaid expenses 64 51 78 87
Withholding taxes and others 687 759 705 777
Unbilled revenues 175 195
Current
Payment to vendors
for supply of goods 131 129 141 145
Deferred contract cost 40 11 65 33
Prepaid expenses 874 736 1,160 968
Unbilled revenues 3,904 3,856 4,354 4,325
Withholding taxes and others 1,832 1,356 2,091 1,583
Other receivables 3 3 28
Total 7,933 7,361 9,095 8,508

Capital advances represent the amount paid in advance on capital expenditure. Unbilled revenues are classified as non-financial asset where the right to consideration is dependent on completion of contractual milestones.

Withholding taxes and others represent local taxes payable in various countries in which we operate.

We provide for gratuity, a defined benefit retirement plan ("Gratuity Plan"), covering eligible employees. The Gratuity Plan provides a lump sum payment to vested employees at retirement, death, incapacitation, or termination of employment, of an amount based on the respective employees salary and the tenure of employment.

7. Deferred tax assets / liabilities

Particulars Standalone Consolidated
2021 2020 2021 2020
Deferred tax assets, net 955 1,429 1,098 1,744
Deferred tax liabilities, net (511) (556) (875) (968)

Deferred tax assets primarily comprise deferred taxes on property, plant and equipment, lease liabilities, compensated absences, allowances for trade receivables and credits related to branch profit taxes. Deferred tax liability primarily comprises branch profit taxes, SEZ Re-investment Reserve and deferred tax on intangible assets.

Net deferred tax asset comprising deferred tax assets less deferred tax liabilities has decreased primarily on account of temporary differences on derivative financial instruments and SEZ reinvestment reserve partially offset by deferred tax asset on compensated absences and intangible assets.

8. Income tax assets / liabilities

in Rs crore
Particulars Standalone Consolidated
2021 2020 2021 2020
Income tax assets
(net) 5,287 4,773 5,811 5,391
Income tax liabilities
(net) 1,737 1,302 2,146 1,490

Our net profit earned from providing software development and other services outside India is subject to tax in the country where we perform the work. Most of our taxes paid in countries other than India can be claimed as credit against our tax liabilities in India.

9. Financial liabilities

The details of trade payables and other financial liabilities are as follows:

in Rs crore
Particulars Standalone Consolidated
2021 2020 2021 2020
Non-current
Accrued compensation to employees 12 22
Particulars Standalone Consolidated
2021 2020 2021 2020
Compensated absences 91 32 97 38
Financial liability under option arrangements 693 621
Accrued expenses Payable for acquisition of business – 163 569
Contingent consideration 86 121
Other payables 5 5 69 5
Current
Trade payables 1,562 1,529 2,645 2,852
Unpaid dividends 33 30 33 30
Accrued compensation to employees 2,915 2,264 4,019 2,958
Accrued expenses 2,944 2,646 4,475 3,921
Retention monies 13 30 13 72
Payable for acquisition of business – Contingent consideration 5 151 75 219
Capital creditors 340 254 371 280
Compensated absences 1,640 1,497 2,020 1,832
Foreign currency forward and options contracts 9 461 56 491
Payable by controlled trusts 199 188
Other payables 460 603 129 490
Total 10,180 9,514 15,549 14,140

Liabilities for accrued compensation to employees include the provision for bonus, accrued salaries, incentives and retention bonus payable to the staff.

Payable for acquisition of business represents contingent consideration payable to the sellers of certain acquired entities depending on the achievement of certain financial targets. Financial liability under option arrangements represents redemption liability towards Stater and HIPUS acquisitions to purchase / sell the corresponding minority stake.

Accrued expenses represent amounts accrued for other operational expenses. Retention monies represent monies withheld on contractor payments, pending final acceptance of their work.

Compensated absences are both accumulating and non-accumulating in nature. The expected cost of accumulating compensated absences is determined by actuarial valuation.

10. Other liabilities
in Rs crore
Particulars Standalone Consolidated
2021 2020 2021 2020
Non-current
Withholding taxes and others(1) 345 364
Deferred income – government grants 14 57 43
Accrued defined benefit plan liability 274 185 324 213
Deferred income 16 22 17 21
Others 1 2
Current
Unearned revenue 3,145 2,140 4,050 2,990
Client deposits 9 18
Withholding taxes and others 1,668 1,344 2,170 1,759
Accrued defined benefit plan liability 3 64 6 67
Deferred income – government grant on land use rights 3 2
Others 4 6
Total 5,465 3,764 6,996 5,121

(1) The Company has deferred payment of certain taxes including payroll taxes in various jurisdictions as permitted by the laws of those jurisdictions on account of the COVID-19 pandemic.

Invoicing in excess of earnings are classified as unearned revenue.

Withholding and other taxes payable represent local taxes payable in various countries in which we operate.

We provide for provident fund to eligible employees of Infosys, which is a defined benefit plan as the Company has an obligation to make good the shortfall, if any, between the return from the investments of the trust and the notified interest rate. The plans provide for periodic payouts after retirement or for a lumpsum payment as set out in rules of each fund and includes death and disability benefits. These_administered rates are determined annually predominantly considering the social and economic factors in the past years. The actuary has provided a valuation for provident fund liabilities on the basis of guidance issued by the Actuarial Society of India.

The Company operates defined benefit pension plan in certain overseas jurisdictions, in accordance with local laws. These_ plans are managed by third-party fund managers. The_plans provide for periodic payouts after retirement or for a lumpsum payment as set out in rules of each fund and includes death and disability benefits. Liabilities with regard to these defined benefit plans are determined by actuarial valuation, using the projected unit credit method. These_defined benefit plans expose the Company to actuarial risks, such as longevity risk, currency risk, interest rate risk and market risk.

Refer to Note 2.20 of the Standalone and Consolidated financial statements in this Annual Report for details of the various defined benefit plans of the Company.

The Code on Social Security, 2020 ("the Code") relating to employee benefits during employment and post-employment benefits received Presidential assent in September 2020. The_ Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified. The Company will assess the impact of the Code when it comes into effect.

11. Provisions

Provision for post-sales client support is towards likely cost for providing client support to fixed-price and fixed-timeframe contracts. On a standalone basis, these provisions amounted to Rs 661 crore as at March 31, 2021, as compared to Rs 506 crore as at March 31, 2020. On a consolidated basis, provision for post-sales client support amounted to Rs 713 crore as at March_ 31, 2021, as compared to Rs 572 crore as at March 31, 2020.

12. Leases

On a standalone basis, addition to right-of-use (ROU) assets was Rs 1,109 crore. This comprises Rs 1,017 crore in land and buildings, and Rs 92 crore towards computer equipment. In the previous year, we had additions to ROU assets of Rs 787 crore. This comprised Rs 738 crore in land and Rs 49_ crore towards computer equipment.

On a consolidated basis, addition to ROU assets was Rs 1,394 crore. This comprises Rs 1,241 crore in land and buildings,

Rs 140 crore in computer equipment and Rs 13 crore in vehicles. In the previous year, we had additions to ROU assets of Rs 1,120 crore. This comprised Rs 1,065 crore in land and buildings,

Rs 49 crore in computer equipment, and Rs 6 crore in vehicles.

IV. Results of our operations

The function-wise classification of the Standalone Statement of Profit and Loss is as follows: in Rs crore

Particulars Year ended March 31,
2021 % 2020 %
Revenue from operations 85,912 100.0 79,047 100.0
Cost of sales 55,541 64.6 52,816 66.8
Gross profit 30,371 35.4 26,231 33.2
Operating expenses
Selling and marketing expenses 3,676 4.3 3,814 4.8
General and administration expenses 4,559 5.3 4,526 5.7
Total operating expenses 8,235 9.6 8,340 10.6
Particulars Year ended March 31,
2021 % 2020 %
Operating profit 22,136 25.8 17,891 22.6
Finance cost 126 0.1 114 0.1
Other income, net 2,467 2.8 2,700 3.4
Profit before tax 24,477 28.5 20,477 25.9
Tax expense 6,429 7.5 4,934 6.2
Profit for the year 18,048 21.0 15,543 19.7

The function-wise classification of the Consolidated Statement of Profit and Loss is as follows:

in Rs crore
Particulars Year ended March 31,
2021 % 2020 %
Revenue from operations 1,00,472 100.0 90,791 100.0
Cost of sales 65,413 65.1 60,732 66.9
Gross profit 35,059 34.9 30,059 33.1
Operating expenses
Selling and marketing expenses 4,627 4.6 4,711 5.2
General and administration expenses 5,810 5.8 5,974 6.6
Total operating expenses 10,437 10.4 10,685 11.8
Operating profit 24,622 24.5 19,374 21.3
Finance cost 195 0.2 170 0.2
Other income, net 2,201 2.2 2,803 3.1
Profit before tax 26,628 26.5 22,007 24.2
Tax expense 7,205 7.1 5,368 5.9
Profit after tax 19,423 19.4 16,639 18.3
Non-controlling interests 72 0.1 45 0.1
Profit attributable to the owners of the Company 19,351 19.3 16,594 18.2

1. Revenue

The growth in our revenues in fiscal 2021 from fiscal 2020 is as follows:

Particulars Standalone Consolidated
2021 2020 % change 2021 2020 % change
Revenue 85,912 79,047 8.7 1,00,472 90,791 10.7

The increase in revenues was primarily attributable to an increase in digital revenues, deal wins including large deal wins and volume increases across most of the segments.

The revenues from digital and core services for fiscals 2021 and 2020 are as follows: in Rs crore

Particulars Consolidated
2021 2020 % change
Digital revenue 48,687 35,617 36.7
Core revenue 51,785 55,174 (6.1)

We have evaluated the impact of COVID-19 resulting from (i) the possibility of constraints to render services which may require revision of estimations of costs to complete the contract because of additional efforts ; (ii) onerous obligations ; (iii) penalties relating to breaches of service-level agreements, and (iv) termination or deferment of contracts by customers. We have concluded that the impact of COVID-19 was not material based on these estimates. Due to the nature of the pandemic, the Company will continue to monitor developments to identify significant uncertainties relating to revenue in future Revenue growth in reported terms includes impact of currency fluctuations. We, therefore, additionally report the revenue growth in constant currency terms, which represents the real growth in revenue excluding the impact of currency fluctuations. We calculate constant currency growth by comparing current period revenues in respective local currencies converted to INR using prior-period exchange rates and comparing the same to our prior-period reported revenues. Our revenues in reported currency terms for fiscal 2021 is US$ 13,561 million, a growth of 6.1%. Ourfirevenues for fiscal 2021 in constant currency grew by 5%.

We added 475 new customers (gross) during fiscal 2021 as compared to 376 new customers (gross) during fiscal 2020. For fiscals 2021 and 2020, 96.2% and 97.5%, respectively, of our revenues came from repeat business, which we define as revenues from a client that also contributed to our revenues during the prior fiscal.

On a consolidated basis, for the year ended March 31, 2021, approximately 97.1% were export revenues whereas 2.9% were domestic revenues, while for the year ended March_31, 2020, 97.4% were export revenues whereas 2.6% were domestic revenues.

The composition of currency-wise revenues for the years ended March 31, 2021 and March 31, 2020 was as follows:

in %
Currency Consolidated
2021 2020
US Dollar 66.5 67.5
UK Pound Sterling 4.6 4.9
Euro 13.4 12.4
Australian Dollar 6.9 6.8
Others 8.6 8.4
Total 100.0 100.0

Our revenues are generated principally from services provided either on a time-and-material, unit-of-work, fixed-price, or fixed-timeframe basis. Revenue on time-and-material and unit-of-work-based contracts, are recognized as the related services are performed. Fixed-price maintenance revenue is recognized ratably either on a straight-line basis when services are performed through an indefinite number of repetitive acts over a specified period or using a percentage-of-completion method when the pattern of benefits from the services rendered to the customer and our costs to fulfil the contract is not even through the period of contract because the services are generally discrete in nature and not repetitive. Revenue from other fixed-price, fixed-timeframe contracts, where the performance obligations are satisfied over time is recognized using the percentage-of-completion method. Revenue from licenses where the customer obtains a "right to use" the licenses is recognized at the time the license is made available to the customer. Revenue from licenses where the customer obtains a "right to access" is recognized over the access period. Where the license is required to be substantially customized as part of the implementation service, the entire arrangement fee for license and implementation is considered to be a single performance obligation and the revenue is recognized using the percentage-of-completion method as the implementation is performed. The percentage of revenue from fixed-price contracts for the years ended March 31, 2021 and March 31, 2020 is approximately 50%.

Our revenues are segmented into onsite and offshore revenues. Onsite revenues are for those services which are performed at client locations or at our development centers outside India, while offshore revenues are for services which are performed at our global development centers in India.

The percentage of our revenues by location from billable IT services professionals for fiscals 2021 and 2020 is as follows:

Particulars Consolidated
2021 2020
Onsite revenue 52.1 54.8
Offshore revenue 47.9 45.2
Total 100.0 100.0

The proportion of work performed at our facilities and at client sites varies from period to period. The services performed onsite typically generate higher revenues per capita, but at lower gross margins in percentage as compared to the services performed at our own facilities in India. Therefore, any increase in the onsite effort impacts our margins.

The reduction in onsite revenue mix is mainly on account of reduced onsite effort mix which is significantly on account of travel restrictions in the year to onsite locations due to pandemic and client focus on cost take-outs.

The details of billable hours expended for onsite and offshore on our IT services professionals for fiscals 2021 and 2020 are as follows:

in %
Particulars Consolidated
2021 2020
Onsite effort 25.8 28.1
Offshore effort 74.2 71.9
Total 100.0 100.0

Revenues and gross profits are also affected by employee utilization rates. We define employee utilization for IT services as the proportion of total billed person months to total available person months, excluding sales, administrative and support personnel.

The utilization rates of billable IT services professionals are as follows:

Particulars Consolidated
2021 2020
Including trainees 80.8 80.3
Excluding trainees 84.7 84.0

IT services, wherever mentioned above, represent services excluding business process management services and products and platforms business.

The break-up of revenues from software and professional services and products and platforms is as follows:

Particulars Standalone Consolidated
2021 2020 2021 2020
Software and professional services 85,669 78,809 93,387 85,260
Software products and platforms 243 238 7,085 5,531
Total revenue from operations 85,912 79,047 1,00,472 90,791

Refer to the ‘Segmental profitability section in this report for more details on the analysis of segment revenues.

Revenue per employee has increased from US$ 54,142 in fiscal 2020 to US$ 55,229 in fiscal 2021 on a consolidated basis.

2. Expenditure

Cost of sales – standalone

in Rs crore
Particulars 2021 % 2020 % Growth %
Revenues 85,912 100.0 79,047 100.0 8.7
Cost of sales
Salaries and bonus 40,602 47.2 38,277 48.4 6.1
Cost of technical sub-contractors 9,527 11.1 8,446 10.7 12.8
Travelling cost 429 0.5 1,726 2.2 (75.1)
Cost of software packages for own use 933 1.1 809 1.0 15.3
Third-party items bought for service delivery to clients 1,116 1.3 842 1.1 32.5
Communication cost 224 0.3 201 0.3 11.4
Short-term leases 9 34 (73.5)
Provisions / (reversals) for post-sales client support 47 4 1,075
Depreciation and amortization expenses 2,321 2.7 2,144 2.7 8.3
Repairs and maintenance 305 0.4 333 0.4 (8.4)
Others 28
Total cost of sales 55,541 64.6 52,816 66.8 5.2
Cost of sales – consolidated
in Rs crore
Particulars 2021 % 2020 % Growth %
Revenues 1,00,472 100.0 90,791 100.0 10.7
Cost of sales
Salaries and bonus 49,444 49.2 45,477 50.1 8.7
Cost of technical sub-contractors 7,084 7.1 6,712 7.4 5.5
Travelling cost 482 0.5 2,045 2.2 (76.4)
Cost of software packages for own use 1,184 1.2 1,010 1.1 17.2
Third-party items bought for service delivery to clients 3,002 3.0 1,667 1.8 80.1
Consultancy and professional charges 61 0.1 50 0.1 22.0
Communication cost 333 0.3 300 0.3 11.0
Short-term leases 31 65 0.1 (52.3)
Provisions for post-sales client support 39
Depreciation and amortization expenses 3,267 3.2 2,893 3.2 12.9
Repairs and maintenance 479 0.5 501 0.6 (4.4)
Others 7 12 (41.7)
Total cost of sales 65,413 65.1 60,732 66.9 7.7

On a standalone basis, cost of sales was 64.6% of revenues, compared to 66.8% during the previous year. On a consolidated basis, cost of sales was 65.1% of revenues, compared to 66.9% during the previous year. The cost of efforts, comprising employee cost and cost of technical sub-contractors, has decreased as a percentage of revenue from 59.1% in fiscal 2020 to 58.3% in fiscal 2021 on a standalone basis and from 57.5% in fiscal 2020 to 56.3% in fiscal 2021 on a consolidated basis. The cost of efforts has decreased mainly on account of improvement in offshore mix partially offset by compensation increase effective Q4 fiscal 2021 and higher variable payouts during fiscal 2021. The_decrease in travel costs is on account of reduced travel and visa costs on account of pandemic.

On a standalone basis, the cost of technical sub-contractors included Rs 3,691 crore towards the purchase of services from subsidiaries for the year ended March 31, 2021, as against

Rs 2,824 crore in the previous year. The details of such related party transactions are available in Note 2.23 to the Standalone financial statements in the Annual Report.

On both standalone and consolidated basis, the travelling cost representing the cost of travel included in cost of sales constituted approximately 0.5% and 2.2% of total revenue for the years ended March 31, 2021 and March_31, 2020, respectively. The decrease in travel costs is on account of reduced travel and visa costs on account of pandemic. Cost of software packages primarily represents the cost of software packages and tools procured for our internal use. On_a standalone basis, the cost of software packages was 1.1% of revenues, compared to 1.0% during the previous year. On_a consolidated basis, the cost of software packages was 1.2% and 1.1% of total revenue for the years ended March_31, 2021 and March 31, 2020 respectively.

Third-party items bought for service delivery to clients include software and hardware items.

A large part of our revenues is generated from software development centers in India. We use high-end communication tools to establish real-time connections with our clients.

On_both standalone and consolidated basis, the communication costs represent approximately 0.3% of the revenues for each of the years ended March 31, 2021 and March 31, 2020. Under Ind AS 116, we recognized a ROU asset and a corresponding lease liability for all lease arrangements in which we are a lessee, except for leases with a term of 12 months or less (short-term leases). For these short-term leases, we recognized the lease payments as an operating expense on a straight-line basis over the term of the lease. The Company provides its clients with a fixed-period, post-sales support on all its fixed-price, fixed-timeframe contracts. The_Company estimates such costs based on historical experience and estimates are reviewed on a periodic basis for any material changes in assumptions and likelihood of occurrence. On a standalone basis, we provided Rs 2,321 crore and Rs 2,144 crore towards depreciation and amortization, representing 2.7% of total revenues for each of the years ended March 31, 2021 and March 31, 2020, respectively. On a consolidated basis, we provided Rs 3,267 crore and

Rs 2,893 crore towards depreciation and amortization, representing 3.2% of total revenues for each of the years ended March 31, 2021 and March 31, 2020, respectively. On a standalone and consolidated basis, repairs and maintenance represent approximately 0.4% and 0.5% of the revenues, respectively, which was 0.4% and 0.6% at standalone and consolidated level, respectively, in the previous year.

Gross profit

On a standalone basis, the gross profit during the year was Rs 30,371 crore, representing 35.4% of revenues, compared to Rs 26,231 crore, representing 33.2% of revenues in the previous year. On a consolidated basis, the gross profit during the year was Rs 35,059 crore, representing 34.9% of revenues, compared to Rs 30,059 crore, representing 33.1% of revenues in the previous year.

The gross margins for fiscal 2021 were increased on account of reduction in travelling cost and decrease in cost of efforts partially offset by an increase in third-party items bought for service delivery to customer.

Selling and marketing expenses

On a standalone basis, we incurred selling and marketing expenses at 4.3% of our total revenues in the year ended March 31, 2021, compared to 4.8% of our total revenues in the year ended March 31, 2020. Selling and marketing expenses primarily comprise employee costs, travelling costs and branding and marketing costs. All other expenses, excluding employee costs, amounted to 0.5% of revenues during the year, which was 1.1% in the previous year. On a consolidated basis, we incurred selling and marketing expenses at 4.6% of our total revenues in the year ended March 31, 2021, as compared to 5.2% in the year ended March_31, 2020. All other expenses, excluding employee costs, amounted to 0.6% and 1.2% of our total revenues in the years ended March 31, 2021 and March 31, 2020, respectively. The selling and marketing expenses have reduced as a percentage of revenue during fiscal 2021 from fiscal 2020, mainly on account of a decrease in travelling costs and branding and marketing costs.

General and administration expenses

On a standalone basis, our general and administration expenses amounted to 5.3% of our total revenues in the current year and 5.7% in previous year. All other expenses, excluding employee costs, were 3.8% of revenues during the year, as compared to 4.2% during the previous year.

On a consolidated basis, our general and administration expenses amounted to 5.8% of our total revenues in the current year and 6.6% in the previous year. All other expenses, excluding employee costs, were 3.8% of revenues during the year, as compared to 4.6% during the previous year.

The general and administration expenses have reduced as a percentage of revenue during fiscal 2021 from fiscal 2020, mainly on account of a decrease in travelling costs, repairs and maintenance, consulting and professional expenses and power and fuel.

Corporate social responsibility (CSR)

As per Section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on CSR activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief, COVID-19 relief and rural development projects. A_CSR committee has been formed by the Company as per the Act. The funds were primarily allocated to a corpus and utilized through the year on these activities which are specified in Schedule VII of the Companies Act, 2013: A) Gross amount required to be spent by the Company during the year is Rs 372 crore.

B) Amount spent during the year on:

in Rs crore
Particulars In cash Yet to be Total
paid in cash
1. Construction /
acquisition of any asset
2. On purposes
other than (1) above(1) 375 375

(1) Includes Rs 50 crore towards unspent CSR account as this pertains to ongoing projects. The unspent amount will be transferred to Unspent CSR account within 30 days from the end of the financial year, in accordance with the CSR rules.

Consequent to the Companies (Corporate Social Responsibility Policy) Amendment Rules, 2021 ("the Rules"), the Company intends to transfer its CSR capital assets created prior to January 2021 to a controlled subsidiary (referred to as "the Subsidiary") to be established in accordance with Section 8 of the Companies Act, 2013 for charitable objects. The transfer will be undertaken upon obtaining the required approvals from regulatory authorities.

The carrying amount of the capital asset amounting to Rs 283 crore has been impaired and included as CSR expense in the Standalone financial statements because the Company will not be able to recover the carrying amount of the asset from the Subsidiary on account of prohibition on payment of dividend by this Subsidiary.

The Subsidiary will be included in the Consolidated financial statements of the Company commencing in the period from formation because the Company will have the power to direct all of the Subsidiarys relevant activities, which affect returns and the Company will be exposed to any future financial support which may be required by the Subsidiary. The_Company has evaluated the impact of the Rules on the carrying amount of the capital asset of Rs 283 crore in the Consolidated financial statements as at March_31, 2021, and concluded that the recoverable amount of capital asset, estimated based on future cash flows from continuing use of the capital asset, is expected to exceed the carrying amount, including in the period subsequent to the transfer to the Subsidiary.

3. Operating profits

During the year, on a standalone basis, we earned an operating profit of Rs 22,136 crore, representing 25.8% of total revenues, compared to Rs 17,891 crore, representing 22.6% of total revenues, during the previous year.

During the year, on a consolidated basis, we earned an operating profit of Rs 24,622 crore, representing 24.5% of total revenues, compared to Rs 19,374 crore, representing 21.3% of total revenues, during the previous year.

The increase in operating profit as a percentage of revenue for the current year as compared to the previous year was primarily attributable to an increase in gross profit as a percentage of revenue and decrease in selling and marketing, and general and administration expenses as a percentage of revenue during the same period.

4. Other income and finance cost

Our other income and finance cost for fiscals 2021 and 2020 are as follows:

Particulars Standalone Consolidated
2021 2020 % change 2021 2020 % change
Other income 2,467 2,700 (8.6) 2,201 2,803 (21.5)
Finance cost 126 114 10.5 195 170 14.7

On a standalone basis, other income for fiscal 2021 primarily includes income from investments of Rs 1,474 crore, gain on investments of Rs 150 crore, foreign exchange gain of Rs 558 crore on forward and options contracts partially offset by foreign exchange loss of Rs 279 crore on translation of other assets and liabilities. Additionally, in the current year, the Company received Rs 321 crore of dividend from its subsidiary. During the previous year, other income primarily included income from investments of Rs 1,502 crore, gain on investments of Rs 229 crore, foreign exchange gain of Rs 1,056 crore on translation of other assets and liabilities, partially offset by a foreign exchange loss of Rs 528 crore on forward and options contracts.

On a consolidated basis, other income for fiscal 2021 primarily includes income from investments of Rs 1,615 crore, gain on investments of Rs 156 crore, foreign exchange gain of

Rs 556 crore on forward and options contracts partially offset by foreign exchange loss of Rs 346 crore on translation of other assets and liabilities.

During the previous year, other income primarily included income from investments of Rs 1,613 crore, gain on investments of Rs 224 crore, foreign exchange gain of Rs 1,023 crore on translation of other assets and liabilities partially offset by a foreign exchange loss of Rs 511 crore on forward and options contracts.

Interest income in fiscal 2021 has declined as compared to fiscal 2020 primarily due to a decrease in yield on investment. On_ a consolidated basis, interest income on income tax refund for fiscal 2021 is Rs 4 crore compared to Rs 259 crore for fiscal 2020.

We use foreign exchange forward and options contracts to hedge our exposure against movements in foreign exchange rates.

Finance cost is on account of leases. The lease payments are discounted using the interest rate implicit in the lease or, if not readily determinable, using the incremental borrowing rates in the country of domicile of these leases.

5. Provision for tax

We have provided for our tax liability both in India and overseas. The applicable Indian corporate statutory tax rate for both the years ended March 31, 2021 and March 31, 2020 is 34.94%.

In India, we have benefitted from certain tax incentives that the Company has received for the export of software from units registered under the Software Technology Park (STP) Scheme and we continue to benefit from certain tax incentives for the units registered under the SEZ Act, 2005. However, the income tax incentives provided by the Government of India for STP units have expired, and the income from all of our STP units are now taxable. SEZ units, which began providing services on or after April 1, 2005, are eligible for a deduction of 100% of profits or gains derived from the export of services for the first five years from the financial year in which the unit has commenced the provision of services and 50% of such profits or gains for further five years. Up to 50% of such profits or gains for further five years thereafter is subject to the creation of a SEZ Re-investment Reserve out of the profit of the eligible SEZ units and utilization of such reserve by the Company for acquiring new plant and machinery for the purpose of its business as per the provisions of the Income-tax Act, 1961. In the event, the Company is not able to utilize the SEZ reserve for investment in plant and machinery within the timeline specified under the Income-tax Act, 1961, the Company will have to pay tax on the unutilized reserve following the expiry of the year specified. This would result in increase in tax cost.

As a result of these tax incentives, a portion of pre-tax income has not been subject to income tax. These tax incentives resulted in a decrease in income tax expense by Rs 2,468 crore on a standalone basis and Rs 2,569 crore on a consolidated basis for the year ended March 31, 2021, and Rs 2,637 crore on a standalone basis and Rs 2,718 crore on a consolidated basis for the year ended March 31, 2020.

Particulars

Standalone

Consolidated

2021 2020 2021 2020
Income tax expense
(in Rs crore) 6,429 4,934 7,205 5,368
Effective tax rate (in %) 26.3 24.1 27.1 24.4

On a standalone basis, the effective tax rate (based on profit before tax) increased to 26.3% in fiscal 2021, as compared to 24.1% in fiscal 2020. On a consolidated basis, the effective tax rate for fiscal 2021 and fiscal 2020 was 27.1% and 24.4%, respectively. Effective tax rate is generally influenced by various factors, including differential tax rates, non-deductible expenses, exempt non-operating income, overseas taxes, benefits from SEZ units, tax reversals and provisions pertaining to prior periods, and other tax deductions. The_increase in effective tax rate from fiscal 2020 to fiscal 2021 was mainly due to decrease in tax benefits from SEZ units, partially offset by reduction in overseas taxes as a percentage of profit before income tax. During the current year, on a consolidated basis, the tax expense includes reversal of provisions of Rs 360 crore made in earlier periods, partially offset by an additional tax provision of Rs 12 crore pertaining to earlier periods. Forfithe previous year, the tax reversals comprise a reversal of provisions of Rs 508 crore made in earlier periods, partially offset by an additional tax provision of Rs 129 crore pertaining to prior periods. On a standalone basis, the tax expense includes reversal of provisions of Rs 298 crore made in earlier periods. Forfithe previous year, the tax reversals comprise a reversal of provisions of Rs 368 crore made in earlier periods, partially offset by an additional tax provision of Rs 70 crore pertaining to earlier periods.

These reversals pertains to prior periods on account of adjudication of certain disputed matters in favor of the Company and upon filing of tax return, across various jurisdictions and changes to tax regulation. The additional provision pertaining to prior periods is primarily due to filing of tax returns in various jurisdiction.

Refer to Note 2.22, ‘Contingent liabilities and commitments, in the Consolidated and Standalone financial statements in the Annual Report for disclosures on claims against the Company not acknowledged as debts.

6. Net profit after tax

On a standalone basis, our net profit increased by 16.1% to Rs 18,048 crore for the year ended March 31, 2021 from Rs 15,543 crore in the previous year. This represents 21.0% and 19.7% of total revenue for the years ended March 31, 2021 and March 31, 2020, respectively.

The increase in net profit as a percentage of revenues for fiscal 2021 as compared to fiscal 2020 was primarily attributable to the increase in operating profit by 3.2% partially offset by the decrease in other income and finance cost by 0.6% as a percentage of revenue and the increase in tax expense by 1.3% as a percentage of revenue.

On a consolidated basis, our net profit increased by 16.6% to Rs 19,351 crore for the year ended March 31, 2021 from Rs 16,594 crore in the previous year. This represents 19.3% and 18.2% of total revenue for the years ended March 31, 2021 and March 31, 2020, respectively.

The increase in net profit as a percentage of revenues for fiscal 2021 as compared to fiscal 2020 was primarily attributable to the increase in operating profit by 3.2% partially offset by the decrease in other income and finance cost by 0.9% as a percentage of revenue and the increase in tax expense by 1.2% as a percentage of revenue.

7. Earnings per share (EPS)

The details of change in EPS on standalone and consolidated basis are as follows:

Particulars Standalone Consolidated
2021 (Rs) 2020 (Rs) % increase 2021 (Rs) 2020 (Rs) % increase
Basic 42.37 36.34 16.6 45.61 38.97 17.0
Diluted 42.33 36.32 16.5 45.52 38.91 17.0

The weighted average equity shares used in computing earnings per equity share are as follows:

Particulars Standalone Consolidated
2021 2020 2021 2020
Basic 425,94,38,950 427,70,30,249 424,24,16,665 425,77,54,522
Diluted 426,30,92,514 427,98,08,826 425,07,32,467 426,51,44,228

8. Segmental profitability

The Companys operations predominantly relate to providing end-to-end business solutions to enable clients to enhance performance of their business. Business segments of the Company are primarily enterprises in Financial Services and Insurance; enterprises in Manufacturing; enterprises in Retail, Consumer Packaged Goods and Logistics; enterprises in the Energy, Utilities, Resources and Services; enterprises in Communication, Telecom OEM and Media; enterprises in Hi-Tech; enterprises in Life Sciences and Healthcare; and all other segments. All other segments represent the operating segments of businesses in India, Japan, China, Infosys Public Services and other enterprises in public services. This is discussed in detail in Note 2.24 to the

Consolidated financial statements in this Annual Report.

Business segments – consolidated

in Rs crore
Particulars Financial Services Retail Communication Energy, Utilities, Resources and Services Manufacturing Hi-Tech Life Sciences All other segments Total
Segmental revenues
2021 32,583 14,745 12,628 12,539 9,447 8,560 6,870 3,100 1,00,472
2020 28,625 14,035 11,984 11,736 9,131 6,972 5,837 2,471 90,791
Growth % 13.8 5.1 5.4 6.8 3.5 22.8 17.7 25.4 10.7
Segmental operating income
2021 8,946 5,117 2,795 3,552 2,563 2,454 2,156 306 27,889
2020 7,306 4,212 2,424 3,216 2,059 1,604 1,431 64 22,316
Growth % 22.4 21.5 15.3 10.5 24.5 53.0 50.7 375.7 25.0
Segmental operating margin (%)
2021 27.5 34.7 22.1 28.3 27.1 28.7 31.4 9.9 27.8
2020 25.5 30.0 20.2 27.4 22.6 23.0 24.5 2.6 24.6

The following graph sets forth our revenue by geography:

Growth in %
North America - 10.5% India - 22.6% Total growth
Europe - 10.9% Rest of the World - 8.6% 10.7%

Overall segment profitability has increased primarily on account of the benefit of rupee depreciation against US dollar, lower travel and visa costs and cost optimization partially offset by increase in employee compensation.

9. Liquidity

Our principal source of liquidity are cash and cash equivalents and cash flow that we generate from operations. We have no outstanding borrowings. We believe our working capital is sufficient for our requirements. Our growth has been financed largely through cash generated from operations.

Particulars Standalone Consolidated
2021 2020 2021 2020
Net cash generated by operating activities 19,902 15,572 23,224 17,003
Net cash used in investing activities (6,309) (116) (7,456) (239)
Net cash used in financing activities (9,566) (17,391) (9,786) (17,591)

Our cash flows are robust and our operating cash flows have increased in fiscal 2021 as compared to fiscal 2020 mainly on account of increase in net profit adjusted for non-cash items, better working capital management partially offset by higher income tax payments. Our liquidity position could be adversely affected if our ability to bill and / or collect from our customers on time is impacted due to COVID-19 disruptions; either due to disruptions on Indian operations or at the customers end.

Consolidated cash and investments of Rs 38,660 crore comprise cash and cash equivalents, current and non-current investments excluding investments in unquoted equity and preference shares, compulsorily convertible debentures and others.

Capital Allocation Policy

Refer to the Boards report in this Annual Report for details on our Capital Allocation Policy reviewed and approved on July 12, 2019.

10. Related party transactions

These have been discussed in detail in Note 2.23 to the

Standalone financial statements in this Annual Report.

11. Events occurring after Balance Sheet date

There were no significant events that occurred after the Balance Sheet date apart from the ones mentioned in ‘Material changes and commitments affecting financial position between the end of the fiscal and date of the report in the Boards report.

12. Key financial ratios

In accordance with the SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018, the Company is required to give details of significant changes (change of 25% or more as compared to the immediately previous financial year) in key sector-specific financial ratios. The Company has identified the following ratios as key financial ratios:

Particulars

Standalone

Consolidated

2021 2020 2021 2020
Market capitalization to revenues (times) NA NA 5.8 3.0
Price / Earnings (times) NA NA 30.0 16.5
Days sales outstanding(1) 71 69
Particulars

Standalone

Consolidated

2021 2020 2021 2020
Cash and investment(2) as a % of total assets 32.7 26.3 35.7 29.4
Revenue growth (%) 8.7 8.1 10.7 9.8
Operating margin (%) 25.8 22.6 24.5 21.3
Net profit margin (%) 21.0 19.7 19.3 18.2
Basic EPS (Rs) 42.37 36.34 45.61 38.97

(1) The Company does not track DSO at a standalone level.

(2) Includes cash and cash equivalents and investments, excluding investments in unquoted equity, preference shares, compulsorily convertible debentures and others.

Ratios where there has been a significant change from fiscal 2020 to fiscal 2021

Revenue growth, operating margin, net profit margin as well as change in basic EPS have been explained in the relevant sections above.

The details of return on net worth at standalone and consolidated levels are as follows:

Particulars Standalone Consolidated
2021 2020 2021 2020
Return on net worth (%) 27.0 24.9 27.3 25.5

Return on net worth is computed as net profit by average net worth. Net profit has increased from Rs 16,594 crore to

Rs 19,351 crore on a consolidated basis and from Rs 15,543 crore to Rs 18,048 crore on a standalone basis for the reasons explained above.

V. Outlook, risks and concerns

This section lists forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these statements as a result of certain factors. Our outlook, risks and concerns are as follows:

Global health pandemic from COVID-19 related_risks

The COVID-19 pandemic is a global humanitarian and health crisis, which continues to impact key geographies that we operate in, with many countries reporting second and third waves of infections. The actions taken by various governments to contain the pandemic, such as closing of borders and lockdown restrictions, have resulted in significant disruption to people and businesses. While vaccines have been made available, there are delays in vaccinating larger populations, increased instances of variants and infections, and consequential stress on the health sector. Consequently, market demand in some segments and supply chains have been affected. India, where most of our operations are located, is experiencing a second wave of infections, including with new variants of the COVID-19 virus. There_ is a marked increase in the number of cases across regions where our development centers are located, and a small percentage of our employees or their families have been adversely affected. We_have initiated several interventions to help our employees and their families, including establishing COVID Care Centers and vaccination centers, and providing them access to medical care facilities. However, the continued stress on the medical infrastructure and increasing cases in the country may impact the health and safety of our employees. In addition, India_may experience future waves, which may further stress the healthcare ecosystem. This_may impact our ability to service our customer requirements on time, as a portion of our employees may be absent from work owing to health issues or to tend to their families.

The COVID-19 pandemic has impacted, and may further impact, all of our stakeholders – employees, clients, vendors, investors and communities we operate in. During fiscal 2021, the impact on revenue due to supply and demand risks we experienced from the COVID-19 pandemic was not significant. The COVID-19 pandemic has heightened several other risks that are described in this section. Some of the specific consequent risks related to the occurrence of the COVID-19 pandemic that have materialized include the following:

• Some of our clients business operations have been negatively impacted due to the economic downturn, resulting in postponement, termination or suspension of some ongoing projects in the initial period of the financial_year.

• Our ability to continue to deliver service delivery obligations while our employees work from home is sometimes constrained by contractual terms with our clients and is therefore dependent on receiving the requisite approvals from them on time.

• Restrictions on travel have marginally impacted our ability to assign and deploy people at required locations and times to deliver contracted services, thereby impacting our revenue and / or profitability.

• Our profitability has been marginally impacted as some clients have sought price reductions or discounts.

• Lower profitability and prolonged payment term requests from clients had marginal negative impact on our cash_flows.

• Our business continuity is marginally impacted as key geographies in which we operate imposed a lockdown and_ / or some of our development centers had to be temporarily shut down due to COVID-19 cases found in our campuses.

• We incurred unanticipated costs in ensuring our offices are safe and hygienic workplaces for our employees; and to enable employees to work from home.

• We incurred additional costs in procuring and deploying hardware assets, technology infrastructure, information security infrastructure and data connectivity charges for remote working.

While the above-mentioned risks have materialized to varied extent in the last financial year, their impact may continue in the next financial year as well. In addition to the above, other consequent risks related to the COVID-19 pandemic that may materialize in future are as follows:

• The financial stability of our clients may get affected or they may file for bankruptcy, jeopardizing our ability to collect our account receivables and unbilled revenue.

• Restrictions on travel, marketing events and in-person client meetings may result in sub-optimal branding and delays in our sales and commercial processes, affecting our revenue.

• Clients may invoke contractual clauses and / or levy penalties if we are unable to meet project quality, productivity and scheduled service-level agreements due to our employees working remotely.

• Our profitability may be negatively impacted if we are unable to eliminate fixed or committed costs in line with reduced demand. Additionally, any sudden change in demand may impact utilization in the short term, thereby impacting margins.

• Our profitability may be marginally impacted as some clients may dispute some of the existing work-in-process that has been recognized by us as unbilled revenues. This in turn can impact our profitability and cash flows_negatively.

• Our exposure to cybersecurity and data privacy breach incidents may increase due to a large number of employees working remotely. This in turn can hinder our ability to continue services and / or operations, impacting revenue, profitability and reputation.

• The productivity of our employees may be negatively impacted due to isolated remote working from home, quarantine requirements, negative social sentiment and personal anxiety.

• We have recently announced that we will cover vaccination costs of our employees and their families and also agreed to provide financial support to affected employees and their families. This may have an impact on our cost structure which may increase if there is an increase in vaccination costs or support extended.

• Due to the rising number of COVID-19 cases in India, with the prolonged second wave and predicted future waves in the regions where most of our employees are located, there may be fulfilment challenges if our employees are on leave as a result of having contracted COVID-19 directly or to take care of anyone in their family.

• Our operations may get disrupted after the reopening of our campuses and offices if any of our returning employees test positive for COVID-19.

• We could be subject to lawsuits from our employees alleging they are exposed to health risks as we transition them back to working from our or our clients offices.

• Our ability to procure goods and services may be impacted as some of our suppliers may not able to operate efficiently during a lockdown.

• Unfavorable currency movements during these times may impact our profitability.

• An increase in insurance premium on the regular policies that we avail may adversely impact our profitable growth or coverage.

• There could be heightened regional or macro risks such as an increase in unemployment, protectionism, immigration reform, extended recession in the economy, geo-political tension and social unrest.

• Many educational institutions in India, which are a primary source of our talent, have postponed students assessments due to the ongoing second wave of COVID-19. This_may affect the timely supply of fresh graduates that we plan to hire this year.

• The uncertainty in demand as our clients deal with a prolonged economic impact of the COVID-19 pandemic may cause us to implement severe cost control measures including reduction in employee bonuses. This could result in increased attrition of employees and / or a higher expenditure on recruitment and sub-contracting services, thereby impacting our profitability.

• If the market price of our shares / ADSs remain low due to a prolonged recession, the value of RSUs and the ability to achieve the performance targets of the PSUs we have given to our employees may reduce. This will impede our ability to retain our high-performing employees.

• Although we have successfully invoked Business Continuity Procedures (BCP) so far, a prolonged continuation of the COVID-19 pandemic may create breakdown in our BCP, impacting our business.

• We could experience potential impairment of acquired entities and investments as a result of prolonged slower economic growth which can impact business momentum and synergies that were expected.

• We may be unable to recoup the investments that we have made in various instruments due to the impact of prolonged economic downturn with consequential impact on liquidity in the sectors or the geographies in which we have invested.

Some of the other key risks that the Company is facing are as follows:

1. Risks related to the markets in which we and our clients operate

• Spending on technology products and services by our clients and prospective clients is subject to fluctuations depending on many factors, including both the economic and regulatory environments in the markets in which they operate.

• Economic slowdown or other factors may affect the economic health of the United States, the United Kingdom, the European Union (EU), Australia or those industries where our revenues are concentrated.

• Our clients may operate in sectors that are adversely impacted by climate change which could consequently impact our business and reputation.

• Per-country restrictions on visas, cost increases in obtaining such visas, increases in required minimum wage levels for visa dependent employees, and / or increased enforcement may affect our ability to compete for, and provide services to clients in work location countries, which could adversely affect our business, results of operations, and / or financial condition.

• Our clients may be the subject of economic or other sanctions by governments and regulators in key geographies that we operate in, limiting our ability to grow these relationships, risking increased penalties and exposure of our business to consequential sanctions.

• A large part of our revenues is dependent on our limited number of clients, and the loss of any one of our major clients could significantly impact our business.

• Financial stability of our clients may fluctuate owing to several factors such as demand and supply challenges, currency fluctuations and other macroeconomic conditions, which may adversely impact our ability to recover fees for the services rendered to them.

• We may not be able to provide end-to-end business solutions to our clients, which could lead to clients discontinuing their work with us, which in turn could harm our business.

• Intense competition in the market for technology services could affect our win rates and pricing, which could reduce our market share and decrease our revenues and / or our profits.

• Our engagements with clients are typically singular in nature and do not necessarily provide for subsequent engagements.

2. Risks related to the investments we make for our growth

• Our business will suffer if we fail to anticipate and develop new services and enhance existing services in order to keep pace with rapid changes in technology and in the industries on which we focus.

• We may be unable to recoup investment costs incurred in developing our software products and platforms.

• We may engage in acquisitions, strategic investments, strategic partnerships or alliances or other ventures that may or may not be successful.

• Goodwill that we carry on our Balance Sheet could give rise to significant impairment charges in the future.

3. Risks related to our cost structure

• Our expenses are difficult to predict and can vary significantly from period to period, which could cause fluctuations to our profitability.

• Any inability to manage our growth could disrupt our business, reduce our profitability and adversely impact our ability to implement our growth strategy.

• Wage pressures in India and the hiring of employees outside India may prevent us from sustaining some of our competitive advantage and may reduce our profit margins.

• We are investing substantial cash assets in new facilities and physical infrastructure, and our profitability could be reduced if our business does not grow proportionately.

• Currency fluctuations and declining interest rates may affect the results of our operations.

4. Risks related to our employee workforce

• Our success depends largely upon our highly skilled technology professionals and our ability to hire, attract, motivate, retain and train these personnel.

• Our success depends in large part upon our management team and key personnel and our ability to attract and retain them.

5. Risks related to our contractual obligations

• Our failure to complete fixed-price (including maintenance) and fixed-timeframe contracts, or transaction-based pricing contracts, within budget and on time, may negatively affect our profitability.

• Our client contracts can typically be terminated without cause, which could negatively impact our revenues and profitability.

• Our client contracts are often conditioned upon our performance, which, if unsatisfactory, could result in lower revenues than previously anticipated.

• Some of our long-term client contracts contain benchmarking provisions which, if triggered, could result in lower future revenues and profitability under the contract.

• Our work with governmental agencies may expose us to additional risks.

6. Risks related to our operations

• Our reputation could be at risk and we may be liable to our clients or to regulators for damages caused by inadvertent disclosure of confidential information and sensitive data.

• Our reputation could be at risk and we may be liable to our clients for damages caused by cybersecurity incidents.

• Our reputation may be impacted and we may incur financial liabilities if privacy breaches and incidents under General Data Protection Regulation (GDPR) adopted by the EU or other data privacy regulations across the globe are attributed to us or if we are not able to take necessary steps to report such breaches and incidents to regulators and data subjects, wherever applicable, within the stipulated time. Further, any claim from our clients for losses suffered by them due to privacy breaches caused by our employees may impact us financially and affect our reputation.

• We may be the subject of litigation which, if adversely determined, could harm our business and operating results.

• Our insurance coverage may not be adequate to protect us against all potential losses to which we may be subject, and this may have a material adverse effect on our business.

• The markets in which we operate are subject to the risk of earthquakes, floods, tsunamis, storms, pandemics and other natural and manmade disasters.

• The safety of our employees, assets and infrastructure may be affected by untoward incidents beyond our control, impacting business continuity or reputation.

• Terrorist attacks or a war could adversely affect our business, results of operations and financial condition.

• Climate change risks are increasingly manifesting in our business operations through physical risks and transitional (market and compliance) risks, which, if not managed adequately, can affect our operations and profitability.

• Our reputation, access to capital and longer-term financial stability could be at risk if we are unable to meet our stated climate action goals under our 2030 ESG vision.

• Negative media coverage and public scrutiny may divert the time and attention of our Board and Management and adversely affect our reputation and the prices of our equity shares and ADSs.

7. Risks related to legislation and regulatory compliance

• Due to the COVID-19 pandemic and the corresponding substantial increases in unemployment rates across certain countries in which we operate, including the United States, United Kingdom, EU and Australia, governments have led and may in the future lead to the enactment of restrictive legislations that could limit companies in those countries from outsourcing work to us, or could inhibit our ability to staff client projects in a timely manner thereby impacting our revenue and profitability.

• New and changing regulatory compliance, corporate governance and public disclosure requirements add uncertainty to our compliance policies and increase our costs of compliance.

• The intellectual property laws of India do not give sufficient protection to software and the related intellectual property rights to the same extent as those in the US. We may be unsuccessful in protecting our intellectual property rights. We may also be subject to third-party claims of intellectual property infringement.

• Our net income would decrease if the Government of India reduces or withdraws tax benefits and other incentives it provides to us or when our tax holidays expire, reduce or terminate.

• In the event that the Government of India or the government of another country changes its tax policies in a manner that is adverse to us, our tax expense may materially increase, reducing our profitability.

• We operate in jurisdictions that impose transfer pricing and other tax-related regulations on us, and any failure to comply could materially and adversely affect our profitability.

• Changes in the policies of the Government of India or political instability may adversely affect economic conditions in India generally, which could impact our business and prospects.

• Attempts to fully address concerns of activist shareholders may divert the time and attention of our Management and Board of Directors and may impact the prices of our equity shares and ADSs.

• Our international expansion plans subject us to risks inherent to doing business internationally.

• Our ability to acquire companies organized outside India may depend on the approval of the RBI and / or the Government of India and failure to obtain this approval could negatively impact our business.

• Indian laws limit our ability to raise capital outside India and may limit the ability of others to acquire us, which could prevent us from operating our business or entering into a transaction that is in the best interests of our shareholders.

8. Risks related to the ADSs

• Historically, our ADSs have traded at a significant premium to the trading prices of our underlying equity shares. Currently, they do not do so, and they may not continue to do so in the future.

• Sales of our equity shares may adversely affect the prices of our equity shares and ADSs.

• The price of our ADSs and the US dollar value of any dividends we declare may be negatively affected by fluctuations in the US dollar to Indian rupee exchange rate.

• Indian law imposes certain restrictions that limit a holders ability to transfer the equity shares obtained upon conversion of ADSs and repatriate the proceeds of such transfer which may cause our ADSs to trade at a premium or discount to the market price of our equity shares.

• An investor in our ADSs may not be able to exercise preemptive rights for additional shares and may thereby suffer dilution of such investors equity interest in us.

• ADS holders may be restricted in their ability to exercise voting rights.

• ADS holders may be restricted in their ability to participate in a buyback of shares offered by us.

• It may be difficult for holders of our ADSs to enforce any judgment obtained in the US against us.

• Holders of ADSs are subject to the Securities and Exchange Board of Indias Takeover Code with respect to their acquisitions of ADSs or the underlying equity shares, and this may impose requirements on such holders with respect to disclosure and offers to purchase additional ADSs or equity shares.

• The reintroduction of dividend distribution tax rate or introduction of new forms of taxes on distribution of profits or changes to the basis of application of these taxes could materially affect the returns to our shareholders.

VI. Internal control systems and their adequacy

The CEO and CFO certification provided in the CEO and CFO Certification section of the Annual Report discusses the adequacy of our internal control systems and procedures.

VII. Material developments in human resources / industrial relations, including number of people employed

Our culture and reputation as a leader in consulting, technology, outsourcing and next-generation digital services enable us to attract and retain some of the best talent.

Human resources management

At Infosys, we focus on the workplace of tomorrow that promotes innovation and a collaborative, transparent and participative organization culture, and rewards merit and sustained high performance. The focus of human resources management at Infosys is to ensure that we enable each and every employee to navigate the next, not just for clients, but also for themselves.

The three key strategic pillars of our Employee Value Proposition are:

• Driving Purposeful impact – ‘Inspiring them to build whats next

• Ensuring continuous learning and career growth – ‘Making sure their career never stands still

• Creating world-class culture and employee experience – ‘Navigating further, together Here are the key initiatives of this year:

• Talent Anywhere model: As we prepare to thrive in the future, it is clear that the new workplace will be hybrid remote with distributed teams becoming more prominent. We expect that the change in workplace will encourage different workforce models. In order to be ready and lead the paradigm change in the workplace, we rolled out the Talent Anywhere model in India that provides flexibility of work location for our employees. We have ensured that we abide by the statutory requirements at all times.

• Digital transformation: The digital transformation journey that we had embarked on a few years back ensured employees could perform all their transactions online through our various mobile-first apps and could connect and collaborate in the remote-working "new normal".

- Launchpad: We expanded the coverage of Launchpad, our mobile app that provides a guided flow for our new hires throughout the onboarding process, making the entire process paperless and faster. It helped us onboard our new hires remotely and make them ready for production. We have seen improvement in employee satisfaction levels with the onboarding process during the pandemic.

- InfyMe: We continued to enrich the InfyMe app with more services that enabled teams during the pandemic and helped them to operate, connect and collaborate more easily. - iEngage: We expanded the reach of iEngage across the geos and helped managers schedule connect sessions with their teams, track attendance, actionize items and provide updates.

- Infosys Meridian: With its event management platform and ability to allow breakout sessions, Infosys Meridian is fast becoming the go-to platform for all employee engagement events.

- Compass: This is not only a one-stop digital platform for all career-related needs of our employees, but also a key lever for reskilling. The platform empowers our workforce to keep pace with the latest digital skills, build their expertise, and explore relevant career opportunities through an internal marketplace. Compass is now available on InfyMe and hence easily accessible to our entire workforce.

- People analytics: We are also investing heavily in people analytics to transform employee experience. In_order to create a data-driven culture, we have come up with two projects: People Dashboard and Data Village, which democratize data and make employee data easily available to managers and HR, to support better decision-making and problem-solving. While we create a data-driven organization and solve business problems using data, we strictly ensure that individual employee data is always protected, guided by our corporate Data Privacy Office and data governance guidelines.

- Robotic process automation (RPA) in HR: We have started leveraging the power of RPAs in HR to enhance productivity of the operations team and usher in intelligent automation in HR.

- Manager Code: This guides managers in keeping teams motivated through constant communication and a patient hearing to the challenges and pain points of the team members.

• Employee engagement: Our renewed Employee Engagement Framework is based on the 5Cs – Connect, Collaborate, Celebrate, Care and Culture. Its main objective is to ensure effective engagement, wellbeing and sustained motivation levels among employees in the new hybrid model of work. Virtual events like Unmute 2021 (concert for employees), Petit Infoscion Day (with 16,000+ children in attendance), Infy Incredibles (internal talent showcase) and Awards for Excellence (our global awards ceremony) were some of the highlights of the year.

• Awards for Excellence (AFE): The AFE remains our largest rewards and recognition platform for employees. This year marked its 26th anniversary, and we received the highest number of nominations across geographies, covering over 20 categories. Social Impact Awards were added this year to recognize the contribution of employees during the_pandemic.

• Rewards philosophy: At Infosys, we look at rewards in a holistic manner – what we call as total rewards, a mixture of both monetary and non-monetary rewards. It includes an element of fixed pay, supplemented with ‘pay at risk which is based on performance, and could be paid in cash as well as through stock grants. For a global and diverse workforce it also ensures inclusion of localized benefits plans. In addition to the standard compensation and benefits, we have made rewards available through learning, through diverse career experiences and through platforms for creative contributions as well. Skill bonuses, for people with niche skills is a new concept we have introduced. Our_ key objectives are enabling financial stability and ensuring that our pay is competitive in order to drive high performance and right behaviors.

• Culture and values: The organization culture, driven by our core values, is one of the main levers that drive our business. Employees are regularly reminded about acceptable standards of conduct through various forums like onboarding, mail communications, town halls, and team meetings.

• Be the Navigator (BTN): An empowerment program to encourage purposeful innovation for clients, BTN has also been repurposed to build the momentum of our business focus on cloud and digital.

• Facilitating a positive work environment: Infosys is committed to providing a positive work environment free of discrimination and harassment. Equal opportunity and fair treatment are part of our Code of Conduct to which all employees subscribe. The Resolution Hubs at Infosys provide fair, neutral, and independent forums for employees to voice their concerns. The Company has also instituted multiple channels – represented by the Anti-Sexual Harassment Initiative, HEAR platform (Hearing Employees and Resolving their concerns), Grievance Redressal Body, Whistleblower

Policy, and ICARE – to address employee grievances. In the post-pandemic scenario, there is greater focus on providing psychological safety to employees.

• Employee wellbeing: This is a crucial tenet of the culture at Infosys, where employees receive a holistic wellness experience under HALE (Health Assessment and Lifestyle Enrichment), our flagship wellness program for employees. Wellbeing at Infosys revolves around the cornerstones of physical wellbeing, emotional wellbeing, social wellbeing and safety. Some of the initiatives under the HALE banner_include:

- Self-help model: Increasing the awareness quotient of employees through enablement, education, continuous communication and self-help tools such as a wellbeing chatbot.

- Infy Ikigai: A new program emphasizing the importance of stepping away from the physical and mental demands of everyday life and focusing on self-care.

- Women Samaritans Network: This is a peer-to-peer counseling network exclusively for women employees.

- Digital wellness: This has been a key differentiator, making multiple services available at the click of a button – from nudges, to counseling on our in-house app and self-help tools. Wellbeing support was rated at an all-time high of 91% by employees across locations, and 4.2 out of 5 on individual offerings. The sense of connectedness stands at 88% – a testament to the culture of collaborate and support across the organization.

• Workforce transformation: As we navigate our clients on their technology and digital transformation journey, we at Infosys are also continuously transforming our workforce for digital. The talent management levers that help us maintain the right digital talent mix, meet self-sufficiency in digital areas and better engage and retain our talent are:

– Scaling our digital talent base

- Through structured learning paths and focused entry-level strategies, we are continuously growing our digital talent base

- Digital Quotient, a recently launched digital readiness index

– Creating levers to pivot towards a skill-led organization construct

- Skill Tags are helping prepare a digitally ready talent pipeline

- Skill-based identities to recognize expertise in new-age_/ niche technology spaces

– Nurturing talent to build specialized digital transformation_skills

- New breed of digital specialists to advance our transformation journey, enabling self-directed growth and rewards

- Opportunities through open internal market and career choice programs

– Building next-gen managers to lead resilient hybridfiteams

- Helping managers deliver superior outcomes on learning, create client value and helping build resilient teams

Recruitment

As at March 31, 2021, the Group employed 2,59,619 employees, of which 2,45,037 were professionals involved in service delivery to the clients, including trainees. We_have built our global talent pool by recruiting new students from premier universities, colleges and institutes globally. We_constantly attract and hire developers, architects, project leaders and middle management across the globe across various new age and modern technologies. We recruit students who have consistently shown high levels of achievement from campuses in India. We also recruit students from campuses in the US, UK, Australia, Singapore, Japan, Germany, Canada, Mexico and China. We rely on a rigorous selection process involving aptitude test, coding test and interviews to identify the best applicants. This selection process is continually assessed and refined based on the performance tracking of past recruits. All interviews across the Globe in fiscal 2021 were conducted virtually using video conferencing platforms, and the end-to-end process was digitalized. Thefiteam also implemented an in-house applicant tracking System for India hiring, in place of a third-party software that was used traditionally.

During fiscal 2021, we received 14,27,618 employment applications, interviewed 1,35,216 applicants and extended offers of employment to 48,029 applicants. These statistics do not include our subsidiaries. We added 17,248 new employees, net of attrition, during fiscal 2021.

Education, training and assessment

Continuous learning and reskilling have always been central to our culture. The Foundation Program offered by our Global Education Center enables fresh graduates to become corporate professionals. Its curriculum, comprising over 46 variants of new technology streams, behavioral competencies, and niche skills, has been designed to prepare our talent for dynamic business requirements. A similar training center has been set up in Indianapolis, US to reskill local talent. The Foundation Program is also rolled out in Mexico, UK, Germany, Australia, Singapore, and Japan. The early days of the COVID-19 pandemic saw us relocate trainees from Mysuru and continue their training without missing a beat courtesy this deep-rooted learning culture and our digital learning platform, Lex.

Our reskilling program has twin objectives – increasing fulfillment of immediate digital skill requirements for client projects and enriching the expertise of our global workforce in next-generation technologies and methodologies. We_have invested in and scaled our digital reskilling program globally. Lex, the in-house learning platform, offers over 1,800 curated courses. Over 2,40,000 employees use Lex and are spending approximately 45 minutes per day on average for learning. We_have also repurposed Lex for over a million college students in India via our InfyTQ app. Wingspan, our configurable talent transformation platform for clients, is already live in several global client organizations.

We continue to engage with academic institutions to reskill talent and create new learning courses to meet the demands of this accelerated digital adoption. The adoption of simulated learning continues to gain ground and pilots are being planned with AR / VR content too.

VIII. Other details

1. Quality

The Quality function at Infosys, in line with organizations vision and strategy of ‘Navigate the Next, has three strategic imperatives:

• Differentiate Infosys services through superior performance and quality

• Optimize Infosys client projects as well as internal functions for greater efficiency

• De-risk Infosys operations by ensuring compliance and sustainability Our Quality team has been driving the org-wide agile transformation to scale our capabilities for Agile Digital in tune with the Company strategy. This has resulted in a marked improvement in agile capabilities, with HfS rating Infosys No.1 among all agile service providers. The Quality team also consulted with several large clients and helped them drive their agile, DevOps and overall workplace transformation. It led the way in driving Lean and Automation throughout the organization to enhance productivity and improve quality, which has resulted in large optimization in projects. It deployed robust frameworks, tools and platforms across service lines in a collaborative manner to drive hyper-productivity and has enabled several thousand employees on these over the past year. The Quality team worked with cross-functional teams to drive enterprise agility by simplifying many enterprise processes, thus reducing cost, improving agility in operations, and enhancing employee experience.

This year, as all projects shifted to the remote way of working, Quality created frameworks and playbooks which helped projects adapt to the remote world of work and sustain and improve their productivity and effectiveness. Quality_ has also done extensive research on projects performance, to arrive at ways to optimally design projects for the new hybrid ways of working. Quality also proactively led compliance and assurance through audits and assessments to intensely de-risk the organization, with increased coverage of services and centers. We continue to comply with international management system standards and models viz. ISO 9001, ISO 27001, ISO 14001, ISO 22301, ISO 20000, AS 9100 and ISO 27701. In fiscal 2021, Infosys got appraised at L5 maturity in one of the largest integrated CMMI2.0 assessments in the world ever. Infosys is one of the first few organizations to have complied and certified to the new safety management system (ISO 45001). Privacy_Information Management System for Personal data of EU data subjects in Netherlands and Germany processed at the Infosys India corporate office has been certified based on ISO 27701 standards. All European centers have been assessed for GDPR requirements as well. Infosys is one of first few organizations to comply with and get assessed at enterprise level for SSAE 18 SOC 2 type II & ISAE 3402_/ SSAE 18 SOC 1 type II and has received an independent auditors assurance compliance report.

2. Infosys Center for Emerging Technology Solutions (iCETS)

The Infosys Center for Emerging Technology Solutions (iCETS) is the emerging technology solution incubation partner for Infosys clients and units. iCETS provides next-generation platforms and innovation-as-a-service to futureproof enterprise businesses. The focus is on incubating New Emerging eXploratory Technology (NEXT) solutions for our clients orchestrated by Infosys Living Labs. iCETS enables enterprises to realize their Live Enterprise vision by developing and deploying next-generation offerings_ – such as the Live Enterprise Application Management Platform (LEAP), which has a platform-centric approach for AMS services that makes application management agile, intelligent, integrated and business-aligned. As a leader in data privacy, Infosys Enterprise Data Privacy Suite (iEDPS), assists organizations in tackling the complexity and data privacy responsibilities of organizations to achieve both compliance and business productivity objectives. In order to address the increased cyber threats for our clients business Infosys has built CyberNext, a holistic security-as-a-service platform. Through Infosys Cortex, an AI-driven, cloud-first customer engagement platform, we transform digital customer service through purposeful communication and smart decision-making capabilities. Most of our platforms are designed to be platform-a-a-service offerings with IP_/ patent-led differentiation. These platforms have been able to bring in differentiated services while accelerating innovations for our clients.

Infosys Living Labs brings our entire innovation ecosystem to help clients meet their innovation-at-scale needs – on multiple dimensions. Here we proactively monitor and publish Trend Trees of Horizon 3 technologies and business trends. Assist our clients to foresee disruptions with Listening-Post-as-a-Service (LPaaS). Jointly working with our clients, we enable rapid prototyping, incubating and piloting innovative solutions. We also instill a culture of innovation with our Be The Navigator (BTN) program across large teams, provide shared innovation infrastructure for collaborative innovation, and ensure a seamless transition from a PoC to large-scale implementations with our global innovation hubs. Our evolving partner ecosystem, including startups, universities and hyperscalers, plays a critical role in the increased velocity of ideas and solutions for our clients. Infosys Innovation Network (IIN) is a well-orchestrated partnership between select startups, universities, and Infosys to incubate and bring the best of emerging tech innovations from across the globe to our clients. The IIN program aims to create lighthouse wins for clients to experiment and implement the art-of-the-possible leveraging our global innovation ecosystem. Infosys de-risks client adoption of technology innovations and solutions by carefully curating these startups, finding the right fit and implementing early pilots. Infosys has also established partnerships with key client Corporate Venture Capital (CVC) firms to bring their portfolio startups on to Infosys network. Over the past 12 months, weve engaged with numerous startups and universities across geographies like the US, Finland, Israel, and India, working in spaces like AI, fintech, cloud, cybersecurity, InsureTech, HealthTec, and more.

ICETS has supported over 100 innovation programs for clients like, American telecom companies, large banking institutions, European national postal service, and more, by bringing together Infosys platforms, innovations, and networks. We_act as the contextualizer, crucible and orchestrator to our clients driving next-generation innovations.

3. Branding

Brand Infosys is a key intangible asset for the Company. It serves to position Infosys as the next-generation digital services partner of choice for enterprises navigating their transformation. It is built around the premise that the experience weve gained, for four decades, in managing the systems and workings of global enterprises enables us uniquely to be navigators for our clients. We do it by enabling them with an AI-powered core. We also empower the business with agile digital at scale to deliver unprecedented levels of performance and customer delight. Our Always-on Learning foundation drives their continuous improvement through building and transferring digital skills, expertise and ideas from our innovation ecosystem. Our localization investments in talent and digital centers help accelerate the business transformation agenda. With this, we help every client build their Live Enterprise – an organization that is always navigating its next.

Our marketing reach extends globally through digital-first multi-channel campaigns. As the digital innovation partner for the Australian Open, Roland-Garros and the ATP, we help showcase how brand Infosys is reimagining the tennis ecosystem for a billion fans globally leveraging data, insights and digital experiences. We participate in premier business and industry events around the world, while also organizing our own signature events and CXO roundtables. Confluence, our flagship client event series across the US, Europe and APAC, is rated highly by our clients and industry partners.

4. Client base

Our client-centric approach continues to bring us high levels of client satisfaction. During fiscal 2021, we derived 96.2% of our consolidated revenues from repeat business this fiscal. We, along with our subsidiaries, added 475 new clients, including a substantial number of large global corporations. Our total client base at the end of the year stood at 1,626. The client segmentation, based on the last 12 months revenue for the current and previous years, on a consolidated basis, is as follows:

Clients 2021 2020
100 million dollar + 32 28
50 million dollar + 59 61
10 million dollar + 252 234
1 million dollar + 779 718

5. Infosys Leadership Institute

As with the rest of the world, for Infosys Leadership Institute (ILI), fiscal 2021 was the year of adapting to the ‘new normal. ILI adapted quickly, pivoting from in-person programs to virtual programs. We launched the "Leaders teach" series virtually. Facilitated by senior leaders including client CXOs, these sessions focused on key leadership dimensions like Strategic Influence, Business Acumen, Fostering Client Relationships, Making the Most of a Crisis, Authentic Leadership etc. The series saw large-scale participation from our global leaders.

The year also saw our succession pipeline development program – the "Constellation Program" – come alive with leaders working in cross-functional teams on various strategic projects aligned to key organizational imperatives. Withfiregular reviews, guidance and direction coming from mentors and a CXO-led panel, the teams gained tremendous enterprise perspective in addition to cross-functional exposure. ILI also began focused Career Conversations for Constellation Leaders with senior leadership panels. ILI launched IamtheFuture: The Women in Leadership Program, aimed at grooming women for leadership roles. Designed as a year-long program through fiscal 2022 in partnership with Stanford GSB, the program provides holistic development opportunities for our women leaders globally. In_parallel, ILI continued its focus on bringing personalized and impactful programs from ivy league academic institutions and premier consulting firms for all title-holders. The_programs covered nearly 4,400 participants with very high approval ratings. ILI also worked with leaders to ensure they leveraged the leadership 360 and other development tools to focus on their Leadership Personal Development Plans.

6. Infosys Knowledge Institute

The Infosys Knowledge Institute (IKI) harnesses the intellectual capital of our employees, clients, partners, and academics to develop and share a deeper understanding of the business impact of technology and market trends. Combining surveys, quantitative analysis, and expert interviews, IKI creates perspectives, benchmarks, and diagnostic tools on trends across industries and functions. Current research focuses on four themes: talent, sustainability, evolutionary operating models and the future of money. Recent major works have included Digital Radar, TechCompass trends series, AI and Agile indexes, and The Live Enterprise book. IKI_also publishes regularly in leading business and technology media, and conducts roundtables and seminars. For more information, go to https://infosys.com/iki.

7. ESG vision and ambitions

Almost four decades after our inception, when we first made the commitment to be a values-driven company, we continue to place responsible stewardship at the heart of our business strategy. In October 2020, we launched our ESG Vision 2030 to "shape and share solutions that serve the development of businesses and communities". Today, our 2030 vision reflects how ESG will continue to be integral to Infosys sustainable business performance. We will continue to be carbon-neutral across Scope 1, 2 and 3 emissions every year.

We will expand reskilling initiatives to empower 10 million-plus people with digital skills and 80 million-plus lives with technology for good programs in e-governance, healthcare and education. We commit to nurturing greater inclusivity and strengthening our gender-diverse workforce with at least 45% women employees. We will grow our stakeholder focus and bring the interests of our stakeholders, whether customer, employee, supplier or shareholder, to the fore through an empowered, diverse and inclusive Board. We_will further strengthen data privacy and information security standards across global operations. For more information about our ESG initiatives, read our ESG_ Vision 2030 document at https://www.infosys.com/ content/dam/infosys-web/en/about/corporate-responsibility/ esg-vision-2030/index.html.