MUMBAI: Shares of Indian outsourcing giant Infosys rose as much as 9.02 percent on Monday, as investors cheered the return of co-founder Narayana Murthy, hopeful he would revive the company's flagging fortunes.
Infosys rose to an intraday high of 2,624.9 rupees at the Bombay Stock Exchange, reacting to the development.
On Saturday, Infosys reappointed Murthy as executive chairman of the firm, two years after he retired in August 2011, having turned 65.
His return to the firm -- India's second-largest software outsourcer by revenue -- comes at a time when it is struggling with weak earnings and losing market share to rivals like Tata Consultancy Services and HCL.
The Bangalore-based Infosys, which is also listed on New York's Nasdaq, is seeking to reinvent itself with a strategic overhaul to focus on higher value software and consulting services instead of labour-intensive outsourcing services.
Three decades ago, Murthy and six other Indian software pioneers sat around a kitchen table and created Infosys.
On his return, Murthy appealed to shareholders to be "optimists" and told a news conference on Saturday "we have overcome tougher and bigger challenges before".
Analysts said Murthy's return was positive news.
"It is positive for the firm... we all know Mr. Murthy's execution skills are excellent," Ankita Somani, IT analyst with Mumbai's Angel Broking said.
"I expected this short-term bounce," she told AFP, but said it was too early to forecast a turnaround in fortunes for the firm.
A quarter of Infosys's revenue comes from Europe, and in recent years the firm has shifted focus to emerging and new markets such as Singapore, Brazil, Mexico and eastern Europe.
Many of India's IT outsourcing firms have been going through a rough patch and they say the outlook for the industry remains difficult due to uncertainty in key US and European markets.
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