Narayana Murthy Net Worth To Surge After Re-joining Infosys

Gordon Gekko famously said that there is no motivation greater than personal interest. But the trick is to make it look like one was acting out of selfless interest because that brings you enormous goodwill and sympathy.

N R Narayana Murthy offers a case study on how one can be a brilliant master strategist and act out of self-interest while making it look like a selfless and humanitarian move.

Under the stewardship’s of Kris Gopalkrishnan and S. D. Shibulal, the Infosys stock price has slumped 17% in just 3 months and remained flat on a YOY basis even as rival Tata Consultancy Services’ stock price has surged 20% on a YOY basis.

If anyone has felt the adverse impact of this non-performance, it is Narayana Murthy, the single largest shareholder of Infosys. Narayana Murthy and his family own a massive 2.57 crore shares in Infosys that was worth Rs. 7,750 crore in March 2013. In the 3 months, Narayana Murthy has lost a whopping 1,550 crores.

Now what man can stand by passively and watch this massive destruction of wealth?

Here you have to compliment Narayana Murthy’s public relations department for the way the situation has been handled. To avoid ignorant people criticizing him for being a selfish profit monger, Narayana Murthy has carefully orchestrated his re-appointment as executive Chairman of Infosys to make it look as if he was very reluctant and was only motivated out of humanitarian considerations for Infosys and its’ shareholders. In all the interviews, he claims that he was literally forced out of retirement by K. V. Kamath and the other top brass of Infosys. The salary of Rs. 1 was also a brilliant piece of symbolism that people loved.

The induction of Rohan Murty into Infosys was also part of a brilliant strategy. By ensuring that Rohan Murthy was not given any leadership position and took home a salary of only Rs. 1, Narayana Murthy ensured that the criticism of nepotism was muted. Once Rohan Murty is safely ensconced in Infosys and off the public glare, he can slowly and steadily be groomed for a leadership position.

The best part of this strategic move is that Infosys will get re-rated and command a PE of 23 which its’ arch rival TCS presently enjoys. If so, then every rupee of EPS that Narayana Murthy earns for Infosys will mean a Rs. 23 increment in the share price. This means that on his own shareholding of 2.57 crore shares in Infosys, Narayana Murthy stands to benefit by Rs. 59.11 crore for every rupee of EPS.

Now, if that is not sufficient motivation to return from retirement, what is?