The acrimonious tussle between the founders and the board of Infosys erased $3.5 billion from the Indian software giant’s market value last Friday. Franklin Templeton Investments says the slump triggered by the chief executive’s exit is an opportunity to buy.
“I assume that the CEO vacuum will be temporary and won’t have a detrimental impact on the long-term prospects,’ Allan Lam, Hong Kong-based senior managing director at Franklin Templeton, said in an e-mail. The selloff has created "a good entry point," he said.
Franklin Templeton is putting its money where its mouth is: the money manager added 203,269 Infosys shares according to a filing on August 23, five days after Vishal Sikka resigned as CEO citing escalating personal attacks from the co-founders.
The company has been the largest buyer of the stock among mutual funds this week, data compiled by Bloomberg show. Losses in the shares have been stymied, helped by speculation that another co-founder Nandan Nilekani may step in to steady the ship after they tumbled about 15 per cent over Friday and Monday.