Infosys, Genpact, PepsiCo, ICICI to pay bonuses
Monday,08 March 2010, 14:46 hrs

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New Delhi: Looking to retain and encourage the key talent, companies such as Infosys, Genpact, EXL Services, Maruti Suzuki, Fiat, PepsiCo India, Dabur and ICICI Bank will soon start paying bonuses, with many of them dishing out compensation up to 150 percent of the variable pay. Companies in sectors as diverse as IT and banking and financial services are bracing to give bonuses buoyed by the prospect of promising days ahead, reports Mahima Puri and Pramugdha Mamgain from the Economic Times.
For sectors such as BPO, automobiles and FMCG, the payouts will be a barometer to check their return to giddy days after the crushing blows of last year. For instance, beverage and food maker PepsiCo India, which posted its highest volume growth in a decade last year with the beverage business growing over 32 percent, is expected to pay about Rs 10 lakh as bonus to a top executive earning up to Rs 50 lakh annually. Genpact's rival, EXL Services, is likely to hike bonuses by nearly 8 percent this year. An EXL manager, whose basic salary is about Rs 6 lakh, may be rewarded with Rs 2 lakh this year. EXL global head for human resources Amitabh Hajela said this year is certainly better in terms of overall performance.The initial optimism with which the IT and ITeS industry began the year is fast wearing thin as U.S. protectionism has emerged as a key issue and overseas demand is yet to pick up. "This year has been more conservative in terms of the way we have grown and the bonuses are likely to be on a lower side," said Genpact Senior Vice-Chairman of HR Piyush Mehta. Still, IT major Infosys Technologies may match the December bonuses of up to 100 percent of the variable pay as the company is expecting good results in the fourth quarter, said a person privy to the company?s plan. Infosys Human Resources Group Head Nandita Gurjar said bonuses will be given in April, though she refused to divulge details. "The average bonus payout in the fourth quarter of last year was 50% and this year is certainly better." The banking and financial services sector, where bonus payouts are a time-honoured culture, could be the best paymasters this year. ICICI Bank, which resisted doling out bonuses in the past two years due to the slowdown, is expected to return to its generous ways this year. Also, automobile companies such as Maruti Suzuki and Fiat, whose sales are humming again, are deciding on the extent of bonus payouts this year. "Based on the company's annual performance and the individual's performance, we pay bonuses in May every year," said Maruti Suzuki HR Head SY Siddiqui. A Maruti assistant manager whose variable pay is Rs 80,000 could get up to Rs 85,000 as total payout. Mumbai-based drugmaker Lupin Pharmaceuticals recently paid up to 20 percent bonus to its top performers. A senior executive earning Rs 50 lakh a year got a bonus of about Rs 7.5 lakh

Fuel inflation accelerates RBI action seen

Food prices moderated slightly while fuel price inflation accelerated in late February adding pressure on the Reserve Bank of India (RBI) to raise rates at its April policy review.

India's wholesale price inflation (WPI) is already at 8.56 per cent in January, just above the Reserve Bank of India's (RBI) end-March projection of 8.5 per cent.The food price index rose 17.81 per cent in the 12 months to Feb. 27, marginally lower than an annual rise of 17.87 per cent in the previous week.The recent government decision to raise fuel prices has also stoked inflation. The fuel price index rose 11.38 per cent in the 12 months to Feb. 27, shooting up from an annual rise of 9.59 per cent in the previous week.Market expectations of a rate hike remain unchanged as traders expect the RBI's next move will be to raise its benchmark lending and borrowing rates by at least 25 bps each to 5.00 per cent and 3.50 per cent respectively.The benchmark 10-year year bond is hovering just below the 8-per cent mark mirroring expectations of a rate hike in the near term.This despite talk that the federal government will borrow much of its estimated record borrowing of about $100 billion for the 2010/11 financial year, that begins on April 1, in the first half of the fiscal year.The January industrial output data due on Friday, expected to be a robust 16.65 per cent according to a Reuters poll, will also bolster the case for a rate hike in April.Indian policymakers including the deputy chairman of the planning commission have said earlier this week that food prices will moderate over the next few months.Food prices have moderated only marginally this week, but with fuel prices on the rise, these are now spilling over to the broader economy.This is reflected in the fact that manufacturing price inflation picked up to 6.55 per cent in January from 5 per cent in December.Food prices are making the ruling coalition vulnerable to political attacks.The strength of the coalition has been severely tested on a controversial bill in parliament that seeks to reserve one-third of the total number of seats for women in the house of elected representatives, called the Lok Sabha.

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Nicki Mehra Managing Director, NA Operations

Mr. Mehra serves as managing director of Headstrong. He is responsible for North America Operations including, East, West, South and Central regions.
Mr. Mehra was a co-founder of TechSpan, which merged with Headstrong in October 2003. Prior to that, he was the Executive Vice President for a consulting company that he helped grow from $18 million to $52 million in annual revenues during his tenure.
Mr. Mehra has over 25 years of IT industry experience. He also spent 15 years with the HCL Group, where he helped start and grow HCL-Deluxe Inc., a joint venture with Deluxe Corporation focusing on the financial services market.
Mr. Mehra is a Harvard Business School AMP graduate and holds a business degree from University of Delhi.

Gaurav Jain

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