UNITED STATES SECURITIES AND EXCHANGE
COMMISSION

Washington, D.C. 20549



FORM 20-F



(Mark One)



oRegistration statement pursuant to Section 12(b) or (g) of the Securities Exchange Act of 1934



OR



xAnnual Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934



For the fiscal year ended March 31,
2016

OR



oTransition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934



For the transition period from __________
to _________



OR



oShell Company Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934



Date of event requiring this shell
company report________



Commission File Number 001-35754



INFOSYS LIMITED

(Exact name of Registrant as specified
in its charter)



Not Applicable

(Translation of Registrant’s
name into English)



Bangalore, Karnataka, India

(Jurisdiction of incorporation or organization)



Electronics City, Hosur Road, Bangalore,
Karnataka, India 560 100. +91-80-2852-0261

(Address of principal executive offices)



M.D.Ranganath, Chief Financial
Officer, +91-80-2852-1692

ranganath_m@infosys.com

Electronics City, Hosur Road, Bangalore,
Karnataka, India 560 100.

(Name, telephone, e-mail and / or facsimile
number and address of company contact person)



Securities registered or to be registered
pursuant to Section 12(b) of the Act:





| | Title of Each Class                                                                      | Name of Each Exchange on Which Registered | 
| | ---------------------------------------------------------------------------------------- | ----------------------------------------- | 
| | American Depositary Shares each represented by one Equity Share, par value 5/- per share | New York Stock Exchange                   | 



Securities registered or to be registered pursuant to Section
12(g) of the Act:

None.

(Title of class)



Securities for which there is a reporting obligation pursuant
to Section 15(d) of the Act:

Not Applicable

(Title of class)



Indicate the number of outstanding shares
of each of the issuer’s classes of capital or common stock as of the close of the period covered by the Annual Report: 2,296,944,664
Equity Shares.



Indicate by check mark if the registrant
is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.



YesxNoo



If this report is an annual or transition
report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934.



YesoNox



Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.



YesxNoo



Indicate by check mark whether the registrant
has submitted electronically and posted on its corporate Website, if any, every Interactive Data file required to be submitted
and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant
was required to submit and post such files).



YesoNoo



Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated
filer in Rule 12b-2 of the Exchange Act. (Check one):



|Large accelerated filerx | Accelerated filero | Non- accelerated filero
|------------------------ | ------------------ | -----------------------



Indicate by check mark which basis of
accounting the registrant has used to prepare the financial statements included in this filing:



U.S.
GAAPoInternational
Financial Reporting Standards as issued by the International Accounting Standards BoardxOthero



If this is an annual report, indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).



YesoNox



Currency of presentation and certain
defined terms



In this Annual Report on Form 20-F, references
to “U.S.” or “United States” are to the United States of America, its territories and its possessions.
References to “India” are to the Republic of India. References to “$” or “dollars” or “U.S.
dollars” are to the legal currency of the United States and references to “” or “Rupees” or “Indian
rupees” are to the legal currency of India. Our financial statements are presented in U.S. dollars and are prepared in accordance
with the International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board. References
to a particular “fiscal” year are to our fiscal year ended March 31 of such year.



All references to “we,” “us,” “our,” “Infosys” or the “Company”
shall mean Infosys Limited and our consolidated subsidiaries unless specifically indicated otherwise or the context indicates otherwise.
“Infosys” is a registered trademark of Infosys Limited in countries including United States, India, United Kingdom
and Australia. All other trademarks or trade names used in this Annual Report on Form 20-F are the property of their respective
owners.



All references to “IT services”
exclude business process management services and products business.



Except as otherwise stated in this Annual
Report on Form 20-F, all translations from Indian rupees to U.S. dollars effected on or after April 1, 2009 are based on the fixing
rate in the city of Mumbai on business days for cable transfers in Indian rupees as published by the Foreign Exchange Dealers’
Association of India, or FEDAI.



On March 31, 2016, this exchange rate
was 66.26 per $1.00. No representation is made that the Indian rupee amounts have been, could have been or could be converted into
U.S. dollars at such a rate or any other rate. Any discrepancies in any table between totals and sums of the amounts listed are
due to rounding.



Special Note Regarding Forward-Looking
Statements



This Annual Report on Form 20-F contains
‘forward-looking statements’, as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E
of the Securities Exchange Act of 1934, as amended, that are based on our current expectations, assumptions, estimates and projections
about the Company, our industry, economic conditions in the markets in which we operate, and certain other matters. Generally,
these forward-looking statements can be identified by the use of forward-looking terminology such as ‘anticipate’,
‘believe’, ‘estimate’, ‘expect’, ‘intend’, ‘will’, ‘project’,
‘seek’, ‘should’ and similar expressions. Those statements include, among other things, the discussions
of our business strategy and expectations concerning our market position, future operations, margins, profitability, liquidity
and capital resources. These statements are subject to known and unknown risks, uncertainties and other factors, which may cause
actual results or outcomes to differ materially from those implied by the forward-looking statements. Important factors that may
cause actual results or outcomes to differ from those implied by the forward-looking statements include, but are not limited to,
those discussed in the “Risk Factors” section in this Annual Report on Form 20-F. In light of these and other uncertainties,
you should not conclude that the results or outcomes referred to in any of the forward-looking statements will be achieved. All
forward-looking statements included in this Annual Report on Form 20-F are based on information available to us on the date hereof,
and we do not undertake to update these forward-looking statements to reflect future events or circumstances unless required to
do so by law.



Table of Contents



|Part I   
|---------
|Item 1.  
|Item 2.  
|Item 3.  
|Item 4.  
|Item 4A. 
|Item 5.  
|Item 6.  
|Item 7.  
|Item 8.  
|Item 9.  
|Item 10. 
|Item 11. 
|Item 12. 
|Part II  
|Item 13. 
|Item 14. 
|Item 15. 
|Item 16A.
|Item 16B.
|Item 16C.
|Item 16D.
|Item 16E.
|Item 16F.
|Item 16G.
|Item 16H.
|Part III 
|Item 17. 
|Item 18. 
|Item 19. 



Part I



Item 1. Identity of Directors, Senior
Management and Advisers



Not applicable.



Item 2. Offer Statistics and Expected
Timetable



Not applicable.





Item 3. Key Information



SELECTED FINANCIAL DATA



Summary of Consolidated Financial
Data



You should read the summary consolidated
financial data below in conjunction with the Company's consolidated financial statements and the related notes, as well as the
section titled “Operating and Financial Review and Prospects,” all of which are included elsewhere in this Annual Report
on Form 20-F. The summary consolidated statements of comprehensive income for the years ended March 31, 2016, 2015, 2014, 2013
and 2012 and the summary consolidated balance sheet data as of March 31, 2016, 2015, 2014, 2013 and 2012 have been derived from
our audited consolidated financial statements and related notes which were prepared and presented in accordance with International
Financial Reporting Standards (IFRS) as issued by International Accounting Standards Board. Historical results are not necessarily
indicative of future results.

(Dollars
in millions, except per equity share and equity share data)

|Comprehensive Income Data                                                   | Fiscal       
|--------------------------------------------------------------------------- | -------------
|                                                                            | 2016         
|Revenues                                                                    | 9,501        
|Cost of sales                                                               | 5,950        
|Gross profit                                                                | 3,551        
|Operating expenses:                                                         |              
|Selling and marketing expenses                                              | 522          
|Administrative expenses                                                     | 654          
|Total operating expenses                                                    | 1,176        
|Operating profit                                                            | 2,375        
|Other income, net                                                           | 476          
|Share in associate’s profit/(loss)                                          | –            
|Profit before income taxes                                                  | 2,851        
|Income tax expense                                                          | 799          
|Net profit                                                                  | 2,052        
|Earnings per equity share:                                                  |              
|Basic ($)(1)                                                                | 0.90         
|Diluted ($)(1)                                                              | 0.90         
|Weighted average equity shares used in computing earnings per equity share: |              
|Basic(1)                                                                    | 2,285,616,160
|Diluted(1)                                                                  | 2,285,718,894
|Cash dividend per Equity Share- Interim dividend- ($)(2)(3)(4)              | 0.15         
|Cash dividend per Equity Share- Final dividend- ($)(2)(3)(4)(5)             | 0.47         
|Cash dividend per Equity Share- Interim dividend () (2)(4)                  | 10.00        
|Cash dividend per Equity Share- Final dividend () (2)(4)(5)                 | 29.50        



|(1) | Adjusted for bonus shares                                                                            
|--- | -----------------------------------------------------------------------------------------------------
|(2) | Excludes corporate dividend tax                                                                      
|(3) | Converted at the monthly exchange rate in the month of declaration of dividend.                      
|(4) | Data for fiscal years ended March 31, 2015, 2014, 2013 and 2012 are not adjusted for bonus shares    
|(5) | Data for fiscal year ended March 31, 2016 (fiscal 2016) is not adjusted for June 17, 2015 bonus issue

(Dollars in millions
except equity share data)

|Balance Sheet Data                           | As of March 31,
|-------------------------------------------- | ---------------
|                                             | 2016           
|Cash and cash equivalents                    | 4,935          
|Available-for-sale financial assets, current | 11             
|Investments in certificates of deposit       | –              
|Net current assets                           | 5,804          
|Non-current assets                           | 3,576          
|Total assets                                 | 11,378         
|Non-current liabilities                      | 56             
|Total equity                                 | 9,324          
|Number of shares outstanding (1)(2)          | 2,296,944,664  



|(1) | Includes treasury shares
|--- | ------------------------



|(2) | Data for fiscal years ended March 31, 2015, 2014, 2013 and 2012 have not been adjusted for bonus shares
|--- | -------------------------------------------------------------------------------------------------------



Exchange rates



Our functional currency is the
Indian rupee. We generate a major portion of our revenues in foreign currencies, particularly the U.S. dollar, the United
Kingdom Pound Sterling, the Euro and the Australian dollar, whereas we incur a significant portion of our expenses in Indian
rupees. The exchange rate between the rupee and the U.S. dollar has changed substantially in recent years and may fluctuate
substantially in the future. Consequently, the results of our operations are affected as the rupee appreciates against the
U.S. dollar and other foreign currencies. For fiscal 2016, 2015, 2014, 2013 and 2012, U.S. dollar denominated revenues
represented 69.9%, 68.9%, 68.8%, 70.6% and 71.7% of total revenues, respectively. For the same respective periods, revenues
denominated in United Kingdom Pound Sterling represented 6.6%, 5.9%, 5.9%, 6.4% and 6.8% of total revenues, revenues
denominated in the Euro represented 9.3%, 10.2%, 10.3%, 8.8% and 7.7% of total revenues while revenues denominated in the
Australian dollar represented 6.9%, 7.6%, 7.9%, 8.3% and 7.6% of total revenues. As such, our exchange rate risk primarily
arises from our foreign currency revenues, receivables and payables.



Fluctuations in the exchange rate between the Indian rupee and the U.S. dollar will also affect the U.S. dollar
equivalent of the Indian rupee price of our equity shares on the Indian stock exchanges and as a result, will likely affect the
market price of our American Depositary Shares (ADSs). Such fluctuations also impact the U.S. dollar conversion by the depositary
of any cash dividends paid in Indian rupees on our equity shares represented by the ADSs.



The following table sets forth, for the
fiscal years indicated, information concerning the number of Indian rupees for which one U.S. dollar could be exchanged. The period
end rates are based on the fixing rate in the city of Mumbai on business days for cable transfers in Indian rupees as published
by the Foreign Exchange Dealers' Association of India, or FEDAI.



|Fiscal | Period End | Average | High  | Low  
|------ | ---------- | ------- | ----- | -----
|       |            |         |       |      
|2016   | 66.26      | 65.69   | 68.70 | 62.11
|2015   | 62.50      | 61.18   | 63.04 | 59.11
|2014   | 59.92      | 60.75   | 68.56 | 53.71
|2013   | 54.29      | 54.54   | 57.02 | 50.53
|2012   | 50.88      | 48.10   | 54.28 | 44.00



The following table sets forth the high
and low exchange rates for the previous six months and is based on the exchange rates from Deutsche Bank, Mumbai.



|Month         | High  | Low  
|------------- | ----- | -----
|              |       |      
|April 2016    | 66.73 | 66.18
|March 2016    | 68.32 | 66.31
|February 2016 | 68.70 | 67.64
|January 2016  | 68.14 | 66.32
|December 2015 | 66.98 | 66.10
|November 2015 | 66.82 | 65.36



On May 18, 2016, the fixing rate in the
city of Mumbai for cash transfers in Indian rupees as published by FEDAI was 66.98.



The exchange rates for month-end and
period-end reporting purposes have been based on the FEDAI rates. We believe that exchange rates published by FEDAI are more representative
of market exchange rates than exchange rates published by individual banks. However, FEDAI does not publish exchange rates on a
daily basis for all currencies, and in the absence of availability of daily exchange rates from FEDAI, we utilize exchange rates
from Deutsche Bank, Mumbai, for daily transactions in the ordinary course of business.



Risk Factors



Investing in our American Depositary
Shares, or ADSs, involves a high degree of risk. You should carefully consider the risks and uncertainties described below, together
with all of the other information in this Annual Report on Form 20-F, including the section titled “Management’s Discussion
and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes,
before making a decision to invest in our ADSs. The risks and uncertainties described below may not be the only ones we face. If
any of the risks actually occur, our business, financial condition, operating results and prospects could be materially and adversely
affected. In that event, the market price of our common stock could decline, and you could lose part or all of your investment.



Risks Related to Our Company and Our
Industry



Our revenues and expenses are difficult
to predict and can vary significantly from period to period, which could cause our share price to decline.



Our revenues and profitability have often
fluctuated and may vary significantly in the future from period to period. Therefore, we believe that period-to-period comparisons
of our results of operations should not be relied upon as an indication of our future performance. It is possible that in the future
our results of operations may be below the expectations of market analysts and our investors, which could cause the price of our
equity shares and our ADSs to decline.





A significant part of our total operating expenses, particularly
expenses related to personnel and facilities, are fixed in advance for any particular period. As a result, unanticipated variations
in the number and timing of our projects, employee utilization rates, or the accuracy of our estimates of the resources required
to complete ongoing projects may cause significant variations in our operating results in any particular period. There are also
a number of factors that are not within our control that could cause fluctuations in our operating results from period to period.





We may not be able to sustain our
previous profit margins or levels of profitability.



Our
profitability could be affected by pricing pressures on our services, volatility of the exchange rates between the Indian rupee,
the U.S. dollar, and other currencies in which we generate revenues or incur expenses, increased wage pressures in India and at
other locations where we maintain operations, increases in taxes or the expiration of tax benefits, the size and timing of facilities
expansion and the resulting depreciation and amortization costs, and any increase in visa costs.



While we seek to manage costs efficiently,
if the proportion of our services delivered at client sites increases, we may not be able to keep our operating costs as low in
the future, which would also have an adverse impact on our profit margins. Furthermore, in the past, our profit margin has been
adversely impacted by the expiration of certain tax holidays and benefits in India, and we expect that it may be further adversely
affected as, additional tax holidays and benefits expire in the future.



In addition, adverse cost structures
may impact our ability to price large outsourcing deals competitively leading to lower win rates or reduced profitability.



Any increase in operating expenses not
offset by an increase in pricing or any acquisition with a lower profitability could impact our operating margins.



The economic environment, pricing
pressures, and decreased employee utilization rates could negatively impact our revenues and operating results.



Spending on technology products and services
is subject to fluctuations depending on many factors, including the economic environment in the markets in which our clients operate.



Reduced IT spending in response to challenging
economic environment leads to increased pricing pressure from our clients, which adversely impacts our revenue productivity, which
we define as our revenue divided by billed person months. Moreover, reduced or delayed IT spending also adversely impacts our utilization
rates for IT services professionals.



Reductions in IT spending, reductions
in revenue productivity, increased credit risk and credit terms arising from or related to economic slowdown in the markets in
which our clients operate have in the past adversely impacted, and may in the future adversely impact, our revenues, gross profits,
operating margins and results of operations.



In addition to the business challenges
and margin pressure resulting from economic slowdown in the markets in which our clients operate and the response of our clients
to such slowdown, there is also a growing trend among consumers of IT services towards consolidation of technology service providers
in order to improve efficiency and reduce costs. Our success in the competitive bidding process for new consolidation projects
or in retaining existing projects is dependent on our ability to fulfil client expectations relating to staffing, efficient offshoring
of services, absorption of transition costs and more stringent service levels. If we fail to meet a client’s expectations
in such consolidation projects, this would likely adversely impact our business, revenues and operating margins. In addition, even
if we are successful in winning the mandates for such consolidation projects, we may experience significant pressure on our operating
margins as a result of the competitive bidding process.



Moreover, our ability to maintain or
increase pricing is restricted as clients often expect that as we do more business with them, they will receive volume discounts
or lower rates. In addition, existing and new customers are also increasingly using third-party consultants with broad market knowledge
to assist them in negotiating contractual terms. Any inability to maintain or increase pricing on account of this practice may
also adversely impact our revenues, gross profits, operating margins and results of operations.



Our revenues are highly dependent
on clients primarily located in the United States and Europe, as well as on clients concentrated in certain industries, and an
economic slowdown or other factors that affect the economic health of the United States, Europe or those industries, or any other
impact on the growth of such industries, may affect our business.



In fiscal 2016, 62.7% and 23.0% of our
revenues were derived from projects in North America and Europe, respectively.



Instability and uneven growth in the
global economy has had an impact on the growth of the IT industry in the past and may continue to impact it in the future. This
instability also impacts our business and results of operations, and may continue to do so in the future. In the past, weakness
in the global economy had, and may in the future continue to have, a negative impact on the growth of the IT industry. If the United
States or the European economy weakens or becomes unstable, our clients may reduce or postpone their technology spending significantly,
which may in turn lower the demand for our services and negatively affect our revenues and profitability.



In fiscal 2016, we derived 27.3% of our
revenues from the financial services industry. The industry was severely impacted by the crisis that started in 2008 in the United
States, which led to the United States federal government taking over or providing financial support to many leading financial
institutions and with some leading investment banks going bankrupt or being forced to sell themselves in distressed circumstances.
Any future global economic uncertainty impacting the financial services industry, whom we depend on for a substantial portion of
our annual revenues, may result in the reduction, postponement or consolidation of IT spending, contract terminations, deferrals
of projects or delays in purchases by our clients. Any reduction, postponement or consolidation in IT spending may lower the demand
for our services or impact the prices that we can obtain for our services and consequently, adversely affect our revenues and profitability.



Some of the industries in which our clients
are concentrated, such as the financial services industry or the energy and utilities industry, are, or may be, increasingly subject
to governmental regulation and intervention. For instance, clients in the financial services sector have been subject to increased
regulation following the enactment of the Dodd-Frank Wall Street Reform and Consumer Protection Act in the United States. Increased
regulation, changes in existing regulation or increased government intervention in the industries in which our clients operate
may adversely affect the growth of their respective businesses and therefore negatively impact our revenues.



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



Our functional currency is the Indian
rupee and we incur significant portion of our expenses in Indian rupees. However, we generate the majority of our revenues in
foreign currencies, such as the U.S. dollar or the pound sterling, through our sales in the United States and elsewhere. We also
purchase from overseas suppliers in various currencies. As a result of the increased volatility in the foreign exchange currency
markets, there may be demand from our clients that the impact associated with foreign exchange fluctuations be borne by us. Also,
historically, we have held a substantial majority of our cash funds in Indian rupees. We expect that a majority of our revenues
will continue to be generated in foreign currencies, including the U.S. dollar, the pound sterling, the euro and the Australian
dollar, for the foreseeable future and that a significant portion of our expenses, including personnel costs, as well as capital
and operating expenditures, will continue to be denominated in Indian rupees. Accordingly, changes in exchange rates may have
a material adverse effect on our revenues, other income, cost of sales, gross margin and net income, and may have a negative impact
on our business, operating results and financial condition. For example, during fiscal 2016, every percentage point depreciation
/ appreciation in the exchange rate between the Indian rupee and the U.S. dollar, has affected the company’s incremental
operating margins by approximately 0.50%.



We use derivative financial instruments
such as foreign exchange forward and option contracts to mitigate the risk of changes in foreign exchange exposures. Our purchase
of these derivative instruments, however, may not be adequate to insulate ourselves from foreign currency exchange risks.



We may incur losses due to unanticipated
or significant intra quarter movements in currency markets which could have an adverse impact on our profit margin and results
of operations. Also, the volatility in the foreign currency markets may make it difficult to hedge our foreign currency exposures
effectively.



Further, the policies of the RBI may
change from time to time which may limit our ability to hedge our foreign currency exposures adequately. Full or increased capital
account convertibility, if introduced, could result in increased volatility in the fluctuations of exchange rates between the rupee
and foreign currencies.



A majority of our investments are in
India based assets, and are exposed to fluctuations in the interest rate environment in the country, which depends to a great extent
on RBI monetary policy. Changes in RBI policy in the form of interest rate cuts could result in lower interest income and affect
our profitability.



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



Our ability to execute projects, maintain
our client relationships and acquire new clients depends largely on our ability to attract, hire, train, motivate and retain highly
skilled technology professionals, particularly project managers and other mid-level professionals. If we cannot hire, motivate
and retain personnel, our ability to bid for projects, obtain new projects and expand our business will be impaired and our revenues
could decline.



Increasing worldwide competition for
skilled technology professionals and increased hiring by technology companies, particularly in India, may affect our ability to
hire and retain an adequate number of skilled and experienced technology professionals, which may in turn have an adverse effect
on our business, results of operations and financial condition.



Changes in policies or laws may also
affect the ability of technology companies to attract and retain personnel. For instance, the central government or state governments
in India may introduce legislation which require employers to give preferential hiring treatment to underrepresented groups. The
quality of our work force is critical to our business. If any such central government or state government legislation becomes effective,
our ability to hire the most highly qualified technology professionals may be hindered.



In addition, the demands of changes in
technology, evolving standards and changing client preferences may require us to redeploy and retrain our technology professionals.
If we are unable to redeploy and retrain our technology professionals to keep pace with continuing changes in technology, evolving
standards and changing client preferences, this may adversely affect our ability to bid for and obtain new projects and may have
a material adverse effect on our business, results of operations and financial condition.



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.



Wage costs in India have historically
been significantly lower than wage costs in the United States and Europe for comparably skilled professionals, which has been one
of our competitive strengths. Although, a vast majority of our current workforce is based in India, we expect to increase hiring
in other jurisdictions, including the United States and Europe. Any such hiring is likely to be at wages higher than those prevailing
in India and may increase our operating costs and adversely impact our profitability.



Further, in certain jurisdictions
in which we operate, legislations have been adopted that requires our non-resident employees working in such jurisdictions to
earn the same wages as residents or citizens of such jurisdiction which we have complied with. In case such legislative
proposals are adopted by other jurisdictions our operating costs will go up. For example, the minimum wages for certain work
permit holders in the United Kingdom have increased recently, thereby increasing the cost of conducting business in that
jurisdiction.



Additionally, wage increases in India
may prevent us from sustaining this competitive advantage and may negatively affect our profit margins. We have historically experienced
significant competition for employees from large multinational companies that have established and continue to establish offshore
operations in India, as well as from companies within India. This competition has led to wage pressures in attracting and retaining
employees, and these wage pressures have led to a situation where wages in India are increasing at a faster rate than in the United
States, which could result in increased costs for companies seeking to employ technology professionals in India, particularly project
managers and other mid-level professionals. We may need to increase our employee compensation more rapidly than in the past to
remain competitive with other employers, or seek to recruit in other low labor cost jurisdictions to keep our wage costs low. The
company may issue incentive compensation plans to its employees and management. Any compensation increases in the future may result
in higher operating costs and lower profitability. In certain years, we may not give wage increases due to adverse market conditions
while our competitors may still give wage increases. This may result in higher attrition rates and may impact our ability to hire
the best talent.



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



Our employee base grew significantly in
the recent periods. Between March 31, 2012 and March 31, 2016, our total employee count grew by 29.4% from 149,994 to 194,044.



In addition, in the last five years we
have undertaken and continue to undertake major expansions of our existing facilities, as well as the construction of new facilities.
We expect our growth to place significant demands on our management team and other resources. Our growth will require us to continuously
develop and improve our operational, financial and other internal controls, both in India and elsewhere. Inadequate financial controls
may increase the possibility of fraud and/or negatively impact the accuracy of our financial reporting and stakeholder relationships.
In addition, continued growth increases the challenges involved in:







| | · | recruiting, training and retaining sufficient skilled
technical, marketing and management personnel;
| | - | ----------------------------------------------------------------------------------------------------

| | · | adhering to and further improving our high quality
and process execution standards;
| | - | -----------------------------------------------------------------------------------

| | · | preserving our culture, values and entrepreneurial
environment;
| | - | ---------------------------------------------------------------

| | · | successfully expanding the range of services offered
to our clients;
| | - | --------------------------------------------------------------------

| | · | developing and improving our internal administrative
infrastructure, particularly our financial, operational, communications and other internal systems,
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | maintaining high levels of client satisfaction; and
| | - | ---------------------------------------------------

| | · | maintaining an effective internal
control system and training our employees to mitigate the risk of individuals engaging in unlawful or fraudulent activity, breaching
contractual obligations, or otherwise exposing us to unacceptable business risks
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Our growth strategy relies on expanding
our operations around the world. The costs involved in entering and establishing ourselves in new markets, and expanding such operations,
may be higher than expected and we may face significant competition in these regions. Our inability to manage our expansion and
related growth in these markets or regions may have an adverse effect on our business, results of operations and financial condition.
In addition, our organizational structures, processes and culture may not be sufficiently agile and adaptive to embrace the changes
required to execute our strategy.



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



In recent years, we have been expanding
the nature and scope of our client engagements by extending the breadth of solutions and services that we offer, which include,
for example, application development and maintenance, consulting, business process management, systems integration and infrastructure
management.



The increased breadth of our service
offerings may result in larger and more complex client projects. This will require us to establish closer relationships with our
clients and potentially with other technology service providers and vendors, and require a more thorough understanding of our clients’
operations. Our ability to establish these relationships will depend on a number of factors including the proficiency of our technology
professionals and our management personnel. Thus, if we are unable to attain a thorough understanding of our clients’ operations,
our service offerings may not effectively meet client needs and jeopardize our client engagements, which may negatively impact
on our revenues and financial condition.



Larger projects often involve multiple
components, engagements or stages, and a client may choose not to retain us for additional stages or may cancel or delay additional
planned engagements for various reasons unrelated to the quality of our services and outside of our control, such as the business
or financial condition of our clients or the economy generally. These terminations, cancellations or delays may make it difficult
to plan for project resource requirements, which may have a negative impact on our profitability.



The success of our service offerings
depends, in part, upon the continued demand for such services by our existing and new clients and our ability to meet this demand
in a competitive and cost-effective manner. To obtain engagements for our end-to-end solutions, we are competing with large, well-established
international consulting firms as well as other India-based technology services companies, resulting in increased competition and
marketing costs. Accordingly, we may be unable to continue to expand our service offerings and attract existing and new clients
to these service offerings.



Intense competition in the market
for technology services could affect our pricing, which could reduce our share of business from clients and decrease our revenues.



The technology services market is highly
competitive. Our competitors include large consulting firms, captive divisions of large multinational technology firms, infrastructure
management services firms, Indian technology services firms, software companies and in-house IT departments of large corporations.



The technology services industry is experiencing
rapid changes that are affecting the competitive landscape, including recent divestitures and acquisitions that have resulted in
consolidation within the industry. These changes may result in larger competitors with significant resources. In addition, some
of our competitors have added offshore capabilities to their service offerings. These competitors may be able to offer their services
using the offshore and onsite model more efficiently. Many of these competitors are also substantially larger than us and have
significant experience with international operations. We may face competition in countries where we currently operate, as well
as in countries in which we expect to expand our operations. We also expect additional competition from technology services firms
with current operations in other countries, such as China and the Philippines. Many of our competitors have significantly greater
financial, technical and marketing resources, generate greater revenues, have more extensive existing client relationships and
technology partners and have greater brand recognition than we do. We may be unable to compete successfully against these competitors,
or may lose clients to these competitors. Additionally our ability to compete effectively also depends in part on factors outside
our control, such as the price at which our competitors offer comparable services, and the extent of our competitors’ responsiveness
to their clients’ needs.



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



We have historically earned, and believe
that in the future we will continue to earn, a significant portion of our revenues from a limited number of clients. In fiscal
2016, our largest client accounted for 3.6% of our total revenues, and our five largest clients together accounted for 13.8% of
our total revenues. The volume of work we perform for specific clients is likely to vary from year to year, particularly since
we historically have not been the exclusive external services provider for our clients. Thus, a major client in one year may not
provide the same level of revenues in a subsequent year. There are a number of factors, other than our performance, that could
cause the loss of a client. In certain cases, our business may be impacted when a large client either changes its outsourcing strategy
by moving more work in-house or replacing its existing software with packaged software supported by the licensor. Reduced technology
spending in response to a challenging economic or competitive environment may also result in our loss of a client. If we lose one
of our major clients or if one of our major clients significantly reduces its volume of business with us, our revenues and profitability
could be reduced.



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



We are highly dependent on our Directors (the “Board”), and the management team including our Chief Executive Officer, our Chief Operating Officer,
our Chief Financial Officer, and members of our senior executive leadership. Our future performance and customer relationships
may be affected by any disruptions in the continued service of our directors, executives and other officers.

Competition for senior management in
our industry is intense, and we may not be able to retain senior management personnel or attract and retain new senior management
personnel in the future. Furthermore, we do not maintain key man life insurance for any of the senior members of our management
team or other key personnel. The loss of any member of our senior management or other key personnel may have a material adverse
effect on our business, results of operations and financial condition.



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



As an element of our business strategy,
in response to client requirements and pressures on IT budgets, we are offering an increasing portion of our services on a fixed-price,
fixed-timeframe basis, rather than on a time-and-materials basis. In the fiscal years ended March 31, 2016, 2015 and 2014, revenues
from fixed-price, fixed-timeframe projects accounted for 44.0%, 42.1%, and 40.8% of our total services revenues, respectively.
In addition, pressure on the IT budgets of our clients has led us to deviate from our standard pricing policies and to offer varied
pricing models to our clients in certain situations in order to remain competitive. For example, we are entering into transaction-based
pricing contracts with certain clients who were not previously offered such terms in order to give our clients the flexibility
to pay as they use our services.



The risk of entering into fixed-price,
fixed-timeframe arrangements and transaction-based pricing arrangements is that if we fail to properly estimate the appropriate
pricing for a project, we may incur lower profits or incur losses as a result of being unable to execute projects on the timeframe
and with the amount of labor we expected. Although, we use our software engineering methodologies and processes and past project
experience to reduce the risks associated with estimating, planning and performing fixed-price, fixed-timeframe projects and transaction-based
pricing projects, we bear the risk of cost overruns, completion delays and wage inflation in connection with these projects. If
we fail to estimate accurately the resources and time required for a project, future wage inflation rates, or currency exchange
rates, or if we fail to complete our contractual obligations within the contracted timeframe, our profitability may suffer. We
expect that we will continue to enter into fixed-price, fixed-timeframe and transaction-based pricing engagements in the future,
and such engagements may increase in relation to the revenues generated from engagements on a time-and-materials basis, which would
increase the risks to our business.



Our client contracts can typically
be terminated without cause and with little or no notice or penalty, which could negatively impact our revenues and profitability.



Our clients typically retain us on a
non-exclusive, project-by-project basis. Many of our client contracts, including those that are on a fixed-price, fixed-timeframe
basis, can be terminated with or without cause, between zero and 90 days’ notice. Our business is dependent on the decisions
and actions of our clients, and there are a number of factors relating to our clients that are outside of our control which might
lead to termination of a project or the loss of a client, including:





| | - | financial difficulties for a client;
| | - | ------------------------------------

| | - | a change in strategic priorities, resulting in a reduced level of technology
spending;
| | - | --------------------------------------------------------------------------------------

| | - | a demand for price reductions;
| | - | ------------------------------

| | - | a change in outsourcing strategy by moving more work to the client’s
in-house technology departments or to our competitors;
| | - | ---------------------------------------------------------------------------------------------------------------------------

| | - | the replacement by our clients of existing software with packaged software
supported by licensors;
| | - | --------------------------------------------------------------------------------------------------

| | - | mergers and acquisitions;
| | - | -------------------------

| | - | consolidation of technology spending by a client, whether arising out
of mergers and acquisitions, or otherwise; and
| | - | --------------------------------------------------------------------------------------------------------------------

| | - | sudden ramp-downs in projects due to an uncertain economic environment.
| | - | -----------------------------------------------------------------------





Our inability to control the termination
of client contracts could have a negative impact on our financial condition and results of operations.



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



Our clients generally retain us on a
short-term, engagement-by-engagement basis in connection with specific projects, rather than on a recurring basis under long-term
contracts. Although a substantial majority of our revenues are generated from repeat business, which we define as revenues from
a client who also contributed to our revenues during the prior fiscal year, our engagements with our clients are typically for
projects that are singular in nature. Therefore, we must seek out new engagements when our current engagements are successfully
completed or terminated, and we are constantly seeking to expand our business with existing clients and secure new clients for
our services. In addition, in order to continue expanding our business, we may need to significantly expand our sales and marketing
group, which would increase our expenses and may not necessarily result in a substantial increase in business. If we are unable
to generate a substantial number of new engagements for projects on a continual basis, our business and results of operations would
likely be adversely affected.



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



A number of our contracts have incentive-based
or other pricing terms that condition some or all of our fees on our ability to meet defined performance goals or service levels.
Our failure to meet these goals or a client’s expectations in such performance-based contracts may result in a less profitable
or an unprofitable engagement.



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



As the size and duration of our client
engagements increase, clients may increasingly require benchmarking provisions. Benchmarking provisions allow a customer in certain
circumstances to request a benchmark study prepared by an agreed upon third-party comparing our pricing, performance and efficiency
gains for delivered contract services to that of an agreed upon list of other service providers for comparable services. Based
on the results of the benchmark study and depending on the reasons for any unfavorable variance, we may be required to reduce the
pricing for future services performed under the balance of the contract, which could have an adverse impact on our revenues and
profitability. Benchmarking provisions in our client engagements may have a greater impact on our results of operations during
an economic slowdown, because pricing pressure and the resulting decline in rates may lead to a reduction in fees that we charge
to clients that can have benchmarking provisions in their engagements with us.



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



Currently, the vast majority of our clients
are privately or publicly owned. However, we are increasingly bidding for work with governments and governmental agencies, both
within and outside the United States and India. Projects involving governments or governmental agencies carry various risks inherent
in the government contracting process, including the following:





|- | Such projects may be subject to a higher risk of reduction in scope or
termination than other contracts due to political and economic factors such as changes in government, pending elections or the
reduction in, or absence of, adequate funding, or disputes with other government departments or agencies.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|- | Terms and conditions of government contracts tend to be more onerous
than other contracts and may include, among other things, extensive rights of audit, more punitive service level penalties and
other restrictive covenants. Also, the terms of such contracts are often subject to change due to political and economic factors.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|- | Government contracts are often subject to more extensive scrutiny and
publicity than other contracts. Any negative publicity related to such contracts, regardless of the accuracy of such publicity,
may adversely affect our business and reputation.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|- | Participation in government contracts could subject us to stricter regulatory
requirements, which may increase our cost of compliance.
|- | --------------------------------------------------------------------------------------------------------------------------------------

|- | Such projects may involve multiple parties in the delivery of services
and require greater project management efforts on our part, and any failure in this regard may adversely impact our performance.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In addition, we operate in jurisdictions
in which local business practices may be inconsistent with international regulatory requirements, including anti-corruption and
anti-bribery regulations prescribed under the U.S. Foreign Corrupt Practices Act (FCPA), and the U.K. Bribery Act 2010, which,
among other things, prohibits giving or offering to give anything of value with the intent to influence the awarding of government
contracts. Although we believe that we have adequate policies and enforcement mechanisms to ensure legal and regulatory compliance
with the FCPA, the U.K. Bribery Act 2010 and other similar regulations, it is possible that some of our employees, subcontractors,
agents or partners may violate any such legal and regulatory requirements, which may expose us to criminal or civil enforcement
actions, including penalties and suspension or disqualification from U.S. federal procurement contracting. If we fail to comply
with legal and regulatory requirements, our business and reputation may be harmed.



Any of the above factors could have a
material and adverse effect on our business or our results of operations.



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.



The technology services market is characterized
by rapid technological change, evolving industry standards, changing client preferences and new product and service introductions.
Our future success will depend on our ability to anticipate these advances and develop new product and service offerings to meet
client needs. We may fail to anticipate or respond to these advances on a timely basis, or, if we do respond, the services or technologies
that we develop may not be successful in the marketplace. We have recently introduced, and propose to introduce, several new solutions
involving complex delivery models combined with innovative, and often transaction-based, pricing models. The complexity of these
solutions, our inexperience in developing or implementing them and significant competition in the markets for these solutions may
affect our ability to market these solutions successfully. In addition, the development of some of the services and technologies
may involve significant upfront investments and the failure of these services and technologies may result in our inability to recoup
some or all of these investments. Further, better or more competitively priced products, services or technologies that are developed
by our competitors may render our services non-competitive or obsolete.



Disruptions in telecommunications,
system failures, or virus attacks could negatively impact our operations and ability to provide our services and solutions, which
could result in client dissatisfaction and a reduction of our revenues.



We currently have 114 development centers located in various countries around the world. Our development centers
globally are linked with a telecommunications network architecture that uses multiple service providers and various satellite and
optical links with alternate routing. While we believe we have put
in place adequate infrastructure and business continuity plans in case of virus attack or disruption in services due to failure
in communication network, we cannot assure you that we will be ableto
maintain active voice and data communications between our various development centers and our clients’ sites at all times
due to such disruptions.



Any significant failure
in our ability to communicate could disrupt our business, which could hinder our performance or our ability to complete client
projects on time. This, in turn, could lead to client dissatisfaction and have a material adverse effect on our business, results
of operations, our reputation and financial condition.



We may be liable to our clients
for damages caused by disclosure of confidential information, system failures, errors or unsatisfactory performance of services.



We are often required to collect and
store sensitive or confidential client and customer data. Many of our client agreements do not limit our potential liability for
breaches of confidentiality. Unauthorized misappropriation or disclosure of sensitive or confidential client and customer data,
whether through breach of our computer systems, unauthorized access by our employees or third-party vendors, systems failure or
otherwise, could damage our reputation, cause us to lose clients and subject us to significant liability from our clients or from
our clients’ customers for breaching contractual confidentiality provisions or privacy laws.



Many of our contracts involve projects
that are critical to the operation of our clients’ businesses, and provide benefits which may be difficult to quantify. Any
failure in a client’s system or breaches of security, regardless of our responsibility for such failure, could result in
a claim for substantial damages against us and force us to incur significant expense for our defense or could require that we pay
large sums in settlement. Furthermore, any errors by our employees in the performance of services for a client, or poor execution
of such services, could result in a client terminating our engagement and seeking damages from us.



Our clients may seek more favorable terms
from us in our contracts, particularly in connection with clauses related to the limitation of our liability for damages resulting
from unsatisfactory performance of services. The inclusion of such terms in our client contracts, particularly where they relate
to our attempt to limit our contractual liability for damages, may increase our exposure to liability in the case of our failure
to perform services in a manner required under the relevant contracts. Further, any damages resulting from such failure, particularly
where we are unable to recover such damages in full from our insurers, may adversely impact our business, revenues and operating
margins.



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



We are, and may in the future be, subject
to legal claims arising in the normal course of business. An unfavorable outcome on any litigation matter could require that we
pay substantial damages, or, in connection with any intellectual property infringement claims, could require that we pay ongoing
royalty payments or prevent us from selling certain of our products. In addition, we may decide to settle any litigation, which
could cause us to incur significant costs. A settlement or an unfavorable outcome on any litigation matter could have a material
adverse effect on our business, operating results, reputation, financial position or cash flows.



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.



Our insurance policies cover physical
loss or damage to our property and equipment arising from a number of specified risks and certain consequential losses, including
business interruption, arising from the occurrence of an insured event under the policies. Under our property and equipment policies,
damages and losses caused by certain natural disasters, such as earthquakes, acts of terrorism, floods and windstorms are also
covered. We also maintain general liability insurance coverage, for damage caused by disclosure of confidential information, system
failures, errors or unsatisfactory performance of services to our clients and marine insurance.



We believe we have taken sufficient insurance
policies to cover ourselves from potential losses that we may be subject to. However, this coverage may not continue to be available
on reasonable terms and may be unavailable in sufficient amounts to cover one or more large claims. Also an insurer might disclaim
coverage as to any future claim. A successful assertion of one or more large claims against us that exceeds our available insurance
coverage or changes in our insurance policies, including premium increases or the imposition of a large deductible or co-insurance
requirement, could adversely affect our operating results.





Also, losses arising from events not
covered by insurance policies, could materially harm our financial condition and future operating results. There can be no assurance
that any claims filed, under our insurance policies will be honored fully or timely. Our financial condition may be materially
and adversely affected to the extent we suffer any loss or damage that is not covered by insurance or which exceeds our insurance
coverage.



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.



As of March 31, 2016, we had contractual
commitments of $224 million for capital expenditures, including commitments related to the expansion or construction of facilities.
We may encounter cost overruns or project delays in connection with expansion of existing facilities and construction of new facilities.
Expansions of existing facilities and construction of new facilities will increase our fixed costs. If we are unable to grow our
business and revenues proportionately, our profitability will be reduced.



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



The development of our software products
and platforms requires significant investments. The markets for our suite of software products and platforms are competitive. Our
current software products and platforms or any new software products and platforms that we develop may not be commercially successful
and the costs of developing such new software products and platforms may not be recouped. Since software product and platform revenues
typically occur in periods subsequent to the periods in which the costs are incurred for the development of such software products
and platforms, delayed revenues may cause periodic fluctuations in our operating results.





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



We seek to acquire or make strategic
investments in complementary businesses, technologies, services or products, or enter into strategic partnerships or alliances
with third parties in order to enhance our business.



It is possible that we may not be able
to identify suitable acquisitions, candidates for strategic investment or strategic partnerships, or if we do identify suitable
targets, we may not complete those transactions on terms commercially acceptable to us. Our inability to identify suitable acquisition
targets or investments or our inability to complete such transactions may affect our competitiveness and growth prospects.



Even if we are able to identify an acquisition
that we would like to consummate, we may not be able to complete the acquisition on commercially reasonable terms or the target
may be acquired by another company. Furthermore, in the event that we are able to identify and consummate any future acquisitions,
we could:





|- | issue equity securities which would dilute current
shareholders’ percentage ownership;
|- | --------------------------------------------------------------------------------------

|- | incur substantial debt;
|- | -----------------------

|- | incur significant acquisition-related expenses;
|- | -----------------------------------------------

|- | assume contingent liabilities; or
|- | ---------------------------------

|- | expend significant cash.
|- | ------------------------



These
financing activities or expenditures could harm our business, operating results and financial condition or the price of our common
stock. Alternatively, due to possible difficulties in the capital and credit markets, we may be unable to secure capital on acceptable
terms, if at all, to complete acquisitions.



Moreover, even if we do obtain benefits
from acquisitions in the form of increased sales and earnings, there may be a delay between the time when the expenses associated
with an acquisition are incurred and the time when we recognize such benefits.



Further, if we acquire a company, we
could have difficulty in assimilating that company’s personnel, operations, products, services, solutions, technology and
software. In addition, the key personnel of the acquired company may decide not to work for us. These difficulties could disrupt
our ongoing business, distract our management and employees and increase our expenses.



We have made, and may in the future make,
strategic investments in early-stage technology start-up companies in order to gain experience in or exploit niche technologies.
However, our investments may not be successful. The lack of profitability of any of our investments could have a material adverse
effect on our operating results.



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



Goodwill is subject to impairment
review at least annually. Impairment testing under International Financial Reporting Standards (IFRS) as issued by the
International Accounting Standards Board may lead to impairment charges in the future. Any significant impairment charges
could have a material adverse effect on our results of operations.



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



Some of the regions that we operate in
are prone to earthquakes, floods, tsunamis, storms and other natural and manmade disasters. In the event that any of our business
centers are affected by any such disasters, we may incur costs in redeploying personnel and property, sustain damage to our operations
and properties, suffer significant financial losses or be unable to complete our client engagements in a timely manner, if at all.



In addition, if there is any natural
disaster in any of the locations in which our significant customers are located, we face the risk that our customers may incur
losses or sustain business interruption, which may materially impair our ability to provide services to our customers and may limit
their ability to continue their purchase of products or services from us. Any natural disaster in the markets in which we operate
could have a material adverse effect on our business, financial condition, results of operations and cash flows.



Risks related to Legislation and Regulatory
Compliance



Anti-outsourcing legislation in
certain countries in which we operate, including the United States and the United Kingdom, may restrict companies in those countries
from outsourcing work to us, or may limit our ability to send our employees to certain client sites.



The issue of domestic companies
outsourcing services to organizations operating in other countries is a topic of political discussion in the United States,
as well as in Europe, Asia Pacific and other regions in which we have clients. Some
countries and special interest groups have expressed concerns about a perceived association between offshore outsourcing and
the loss of jobs in the domestic economy. This has resulted in increased political and media attention, especially in the
United States, where the subject of outsourcing and immigration reform has become a notable topic during the recent
presidential debates. It is possible that there could be a change in the existing laws that would restrict offshore
outsourcing or impose new standards that have the effect of restricting the use of certain visas in the foreign
outsourcing context. Such measures would adversely impact our ability
to do business in the jurisdictions in which we operate.



In
addition, the U.S. Congressis
considering extensive changes to U.S. immigration laws regarding the admission of high-skilled temporary and permanent workers.
If any such provisions are signed into law, our cost of doing business in the United States would increase and that may discourage
customers from seeking our services. Further, such laws could disrupt supply chain of our talent and thereby affect our operations
and profitability. This could have a material and adverse effect on our business, revenues and operating results.



Equity investments by governmental entities
in, or governmental financial aid to, our clients may involve restrictions on the ability of such clients to outsource offshore
or otherwise restrict offshore IT vendors from utilizing the services of work visa holders at client locations. Any restriction
on our ability to deploy our trained offshore resources at client locations may in turn require us to replace our existing offshore
resources with local resources, or hire additional local resources, who may only be available at higher wages. Any resulting increase
in our compensation, hiring and training expenses could adversely impact our revenues and operating profitability.



In addition, the European Union (EU)
member states have adopted the Acquired Rights Directive, while some European countries outside of the EU have enacted similar
legislation. The Acquired Rights Directive and certain local laws in European countries that implement the Acquired Rights Directive,
such as the Transfer of Undertakings (Protection of Employees) Regulations, or TUPE, in the United Kingdom, allow employees who
are dismissed as a result of “service provision changes”, which may include outsourcing to non-EU companies, to seek
compensation either from the company from which they were dismissed or from the company to which the work was transferred. This
could deter EU companies from outsourcing work to us and could also result in us being held liable for redundancy payments to such
workers. Any such event could adversely affect our revenues and operating profitability.







Restrictions on immigration may
affect our ability to compete for and provide services to clients in the United States, Europe and other jurisdictions, which could
hamper our growth or cause our revenues to decline.



The vast majority of our employees are
Indian nationals. Most of our projects require a portion of the work to be completed at the client’s location. The ability
of our technology professionals to engage in work-related activity in the United States, Europe and in other countries depends
on the ability to obtain the necessary visas and work permits.



As of March 31, 2016, the majority of
our professionals in the United States held either H-1B visas, which are for professionals who work in a specialty occupation,
or L-1 visas, which are for intra-company transfers of managers, executives or who have specialized knowledge. Both are temporary
visas, but the company may sponsor employees on either visa for green cards. There have been and will continue to be calls for
extensive changes to U.S. immigration laws regarding the admission of highly-skilled temporary and permanent workers. If such legislative
proposals are signed into law, our cost of doing business in the United States may increase dramatically and that may discourage
customers from seeking our services. This could have a material and adverse effect on our business, revenues and operating results.



Although there is no limit to new L-1
visas, there is a limit to the aggregate number of new H-1B visas that the U.S. Citizenship and Immigration Services (USCIS) may
approve in any government fiscal year which is 65,000 annually, plus 20,000 additional H-1B visas that are available to skilled
workers who possess a master's or higher degree from institutions of higher education in the United States. For fiscal 2017, over
236,000 applications were received during the filing period which began on April 1, 2016. The U.S. government conducts a random
lottery to determine which H-1B applications will be adjudicated that year. Increasing demand for H-1B visas, or changes in
how the annual limit is administered, could limit our ability to access those visas.



The USCIS has increased its level of
scrutiny in granting new visas. This may, in the future, also lead to limits on the number of L-1 visas granted. Changes in L-1
visa policy, either by statute or through administrative policy, could limit our ability to transfer existing employees to the
United States.



Many countries have introduced new immigration
related laws, wherein companies sponsoring foreign workers would be required to demonstrate that there are no qualified and experienced
local workers to fill a position to be taken by a proposed visa holder. Similar labor market protective immigration reform measures
have been introduced in Canada, which include new minimum wage requirements for foreign workers, required ratios of local labor,
and new minimum standards for intra-company transfers.



Our reliance on work visas for a significant
number of technology professionals makes us particularly vulnerable to such changes and variations as it affects our ability to
staff projects with technology professionals who are not citizens of the country where the work is to be performed. Many of these
changes are making it more difficult to obtain timely visas and resulting in increased expenses. The government may also tighten
adjudication standards for labor market tests. These changes could negatively affect our ability to utilize current employees to
fulfill existing or new projects and could also result in higher operating expenses.



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



Changing
laws, regulations and standards relating to accounting, corporate governance and public disclosure create uncertainty for our
compliance efforts and may result in added compliance costs. India
has witnessed sweeping changes to its corporate law regime over the past few years. The changes introduced by the Companies
Act, 2013, the Listing Obligations and Disclosure Requirements of the Securities and Exchange Board of India (SEBI), 2015
(Listing Regulations) and the SEBI’s Insider Trading Regulations are
far-reaching and often untested and have added complexity to our corporate compliance regime.



In connection with this Annual Report
on Form 20-F for the fiscal year ended March 31, 2016, our management assessed our internal controls over financial reporting,
and determined that our internal controls were effective as of March 31, 2016. However, we will undertake management assessments
of our internal control over financial reporting in connection with each annual report, and any deficiencies uncovered by these
assessments or any inability of our auditors to issue an unqualified opinion regarding our internal control over financial reporting
could harm our reputation and the price of our equity shares and ADSs.



We are committed to maintaining high
standards of corporate governance and public disclosure, and our efforts to comply with evolving laws, regulations and standards
in this regard have resulted in, and are likely to continue to result in, increased general and administrative expenses and a diversion
of management time and attention from revenue-generating activities to compliance activities.



In addition, it may become more expensive
or more difficult for us to obtain director and officer liability insurance. Further, our Board members and executive officers
could face an increased risk of personal liability in connection with their performance of duties and our regulatory reporting
obligations. As a result, we may face difficulties attracting and retaining qualified Board members and executive officers, which
could harm our business. If we fail to comply with new or changed laws or regulations, our business and reputation may be harmed.



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



We rely on a combination of patent, copyright,
trademark and design laws, trade secrets, confidentiality procedures and contractual provisions to protect our intellectual property.
However, the laws of India do not protect proprietary rights to the same extent as laws in the United States. While we take utmost
care in protecting our intellectual property, our competitors may independently develop similar technology or duplicate our products
or services. Unauthorized parties may infringe upon or misappropriate our products, services or proprietary information.



The misappropriation or duplication of
our intellectual property could disrupt our ongoing business, distract our management and employees, reduce our revenues and increase
our expenses. We may need to litigate to enforce our intellectual property rights or to determine the validity and scope of the
proprietary rights of others. Any such litigation could be time consuming and costly. As the number of patents, copyrights and
other intellectual property rights in our industry increases, and as the coverage of these rights increases, we believe that companies
in our industry will face more frequent infringement claims. Defense against these claims, even if such claims are not meritorious,
could be expensive and time consuming and may divert our management’s attention and resources from operating our company.
From time to time, third parties have asserted, and may in the future assert, patent, copyright, trademark and other intellectual
property rights against us or against our customers. Our business partners may have similar claims asserted against them. Third
parties, including companies with greater resources than us, may assert patent rights to technologies that we utilize in our business.
If we become liable to third parties for infringing their intellectual property rights, we could be required to pay a substantial
damage award and be forced to develop non-infringing technology, obtain a license or cease selling the applications or products
that contain the infringing technology. We may be unable to develop non-infringing technology or to obtain a license on commercially
reasonable terms, or at all. An unfavorable outcome in connection with any infringement claim against us as a result of litigation,
other proceeding or settlement, could have a material and adverse impact on our business, results of operations and financial position.



In addition, there has been a notable
increase in the number of claims or lawsuits initiated by certain litigious, non-practicing entities in the software industry.
The non-practicing entities are business establishments that hold the patents and they seek monetary damages by alleging that
a product feature infringes a patent. These non-practicing entities are also becoming more aggressive in their monetary demands
and requests for court-issued injunctions. We currently intend to vigorously defend these claims. However, as with most litigation,
the outcome is difficult to determine. Such lawsuits or claims may increase our cost of doing business and may potentially be extremely
disruptive if the plaintiffs succeed in blocking the sales of our products and services.





We cannot be sure that the services and
solutions that we offer to our clients do not infringe on the intellectual property rights of third parties, and these third parties
could claim that we or our clients are infringing upon their intellectual property rights. These claims could harm our reputation,
cause us to incur substantial costs or prevent us from offering some services or solutions in the future. Any related proceedings
could require us to expend significant resources over an extended period of time. In most of our contracts, we agree to indemnify
our clients for expenses and liabilities resulting from claimed infringements of the intellectual property rights of third parties.
In some instances, the amount of these indemnities could be greater than the revenues we receive from the client.



Any claims or litigation in this area
could be time-consuming and costly, damage our reputation and/or require us to incur additional costs to obtain the right to continue
to offer a service or solution to our clients. If we cannot secure this right at all or on reasonable terms, or we cannot substitute
alternative technology, our results of operations could be materially adversely affected. The risk of infringement claims against
us may increase as we expand our industry software solutions and platforms and continue to develop and license our software to
multiple clients.



In addition, we rely on third-party software
in providing some of our services and solutions. If we lose our ability to continue using such software for any reason, including
because it is found to infringe the rights of others, we will need to obtain substitute software or seek alternative means of obtaining
the technology necessary to continue to provide such services and solutions. Our inability to replace such software, or to replace
such software in a timely or cost-effective manner, could materially adversely affect our results of operations.



The software industry is making increasing
use of open source software in its development work. We also incorporate open source technology in our products which may expose
us to liability and have a material impact on our product development and sales. The open source license may require that the software
code in those components or the software into which they are integrated be freely accessible under open source terms. While we
take appropriate measures to comply with open source terms, there is a possibility that third-party claims may require us
to disclose our own source code to the public, to make the same freely accessible under open source terms. Any such requirement
to disclose our source code or other confidential information related to our products could materially and adversely affect our
competitive position, results of business operations, financial condition and relationship with client(s).





Increased regulation in the industries
in which our clients operate could harm our business, results of operations and financial condition



The industries in which our clients are
concentrated are increasingly subject to governmental regulation and intervention. For example our clients in the financial and
healthcare sectors may be subject to stringent compliance requirements including privacy and security standards for handling data.
Additionally, clients in the financial services sector have been subject to increased regulation following the enactment of the
Dodd-Frank Wall Street Reform and Consumer Protection Act in the United States. Further, regulators have imposed guidelines for
use of cloud computing services that mandate specific controls or require financial services enterprises to obtain regulatory approval
prior to outsourcing certain functions.



If our customers are unable to obtain
regulatory approval to use our services where required, our business may be harmed. New or changing regulations or legislation
or increased government intervention in any industry affecting our customers may reduce demand for our services or cause us to
incur additional costly changes in our processes or personnel, thereby negatively affecting our business, results of operations
and financial condition.



Risks Related to Investments in Indian
Companies and International Operations Generally



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.



Many of our development centers in India
are registered as Special Economic Zones (SEZ). Under the Special Economic Zones (SEZ) Act, 2005, SEZ units which begin 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 the five years thereafter. Up to 50% of such profits or gains is also available for a further five years subject to
creation of a Special Economic Zone 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.



As a result of these tax incentives,
a portion of our pre-tax income has not been subject to tax. These tax incentives resulted in a decrease in our income tax expense
of $268 million, $273 million and $273 million for the fiscal 2016, 2015 and 2014, respectively, compared to the tax amounts that
we estimate we would have been required to pay if these incentives had not been available. The per share effect of these tax incentives
computed based on both basic and diluted weighted average number of equity shares for fiscal 2016, 2015 and 2014 was $0.12 each.
The basic and diluted weighted average number of equity shares have been adjusted for bonus issue. (Refer to Note 2.12 under Item
18 of this Annual Report on Form 20-F).



If the government of India changes its
policies affecting SEZs in a manner that adversely impacts the incentives for establishing and operating facilities in SEZs, results
of operations and financial condition may be adversely affected.



The Union Budget, 2015 had proposed to
reduce the rate of corporate tax from 30% to 25% over the next four years in a phased manner starting from the FY 2016-2017, but
the process of reducing the corporate tax rate would likely be accompanied by rationalization and removal of various kinds of tax
exemption and incentives for corporate tax payers.



Under the Finance Act, 2016, no tax incentives shall be available to units commencing business activities
on or after April 1, 2020. Further
the Finance Act, 2016 has also amended Section 80-IAB of the Income Act, 1961 whereby tax incentive shall not be available to an
undertaking engaged in the development of Special Economic Zones (SEZ) where the specified activities commences on or after April
1, 2017. When our tax holidays expire, reduce or terminate, our tax expense will materially increase, reducing our profitability.



With our growth of business in SEZ units, we may have to compute our tax liability under Minimum Alternate
Tax (MAT) in future years as the tax liability under normal tax provisions may be lower as compared to MAT tax liability. MAT is
computed on book profits.





The Income Tax Act, 1961 provides that
the MAT paid by us can be adjusted against our normal tax liability over the next ten years. Although MAT paid by us can be set
off against our future tax liability, cash flows for intervening periods could be adversely affected.



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.



The Finance Act, 2012 adopted the General
Anti Avoidance Rules (GAAR). Finance Act, 2015 deferred the implementation of GAAR by two years so as to implement it as part of
a comprehensive regime to deal with The Organization for Economic Co-operation and Development’s (OECD)’s Base Erosion
and Profit Shifting (BEPS) project of which India is an active participant. Thus, GAAR provisions shall be applicable from Financial
Year 2017-18. Pursuant to GAAR, an arrangement in which the main purpose, or one of the main purposes, is to obtain a tax benefit
and may be declared as an “impermissible avoidance arrangement” if it also satisfies at least one of the following
four tests:





|- | The arrangement creates rights
and obligations, which are not normally created between parties dealing at arm’s length.
|- | -----------------------------------------------------------------------------------------------------------------------

|- | It results in misuse or abuse of
provisions of tax laws.
|- | --------------------------------------------------------

|- | It lacks commercial substance or
is deemed to lack commercial substance.
|- | ------------------------------------------------------------------------

|- | It is carried out in a manner,
which is normally not employed for a bona fide purpose.
|- | --------------------------------------------------------------------------------------





If any of our transactions are found
to be impermissible avoidance arrangements under GAAR, our business, financial condition and results of operations may be adversely
affected.





The Finance Act, 2015 had lowered the tax withholding rate on payment made to non-residents towards “royalty”
and/or “fees for technical services” to 10% from 25%, subject to furnishing of Indian Permanent Account Number (PAN)
by such non-residents. The Finance Act 2016 has amended Section 206AA to prescribe alternative documents to PAN, which shall be
notified subsequently. However a lower rate may apply if a Double Taxation Avoidance Agreement exists. As we procure various software
licenses and technical services from non-residents in the course of delivering our products and services to our clients, the cost
of withholding tax on such purchase of software and services may be additional cost to us as the company may have to gross up for
such withholding taxes.



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.



We are required to comply with various
transfer pricing regulations in India and other countries. Additionally, we operate in several countries and our failure to comply
with the local and municipal tax regime may result in additional taxes, penalties and enforcement actions from such authorities.
In the event that we do not properly comply with the transfer pricing and tax-related regulations, our profitability may be adversely
affected.



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



Terrorist attacks and other acts of violence
or war have the potential to directly impact our clients or us. To the extent that such attacks affect or involve the United States
or Europe, our business may be significantly impacted, as the majority of our revenues are derived from clients located in the
United States and Europe. In addition, such attacks may destabilize the economic and political situation in India, may make travel
more difficult, may make it more difficult to obtain work visas for many of our technology professionals who are required to work
in the United States or Europe, and may effectively reduce our ability to deliver our services to our clients. Such obstacles to
business may increase our expenses and negatively affect the results of our operations. Furthermore, any attacks in India could
cause a disruption in the delivery of our services to our clients, and could have a negative impact on our business, personnel,
assets, results of operations and could cause our clients or potential clients to choose other vendors for the services we provide.





Also, regional conflicts in South Asia
could adversely affect the Indian economy, disrupt our operations and cause our business to suffer.South Asia has,
from time to time, experienced instances of civil unrest and hostilities among neighboring countries, including between India and
Pakistan. There have been military confrontations between India and Pakistan that have occurred in the region of Kashmir and along
the India-Pakistan border. Further, Pakistan has sometimes experienced significant instability and this has heightened the risks
of conflict in South Asia. Military activity or terrorist attacks in the future could hurt the Indian economy by disrupting communications
and making travel more difficult and such political tensions could create a greater perception that investments in Indian companies
involve higher degrees of risk. This, in turn, could have a material adverse effect on the market for securities of Indian companies,
including our equity shares and our ADSs, and on the market for our services.



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.



The government of India could change
specific laws and policies affecting technology companies, foreign investment, currency exchange and other matters affecting investment
in our securities which could adversely affect business and economic conditions in India generally, and our business in particular.
If the Government of India changes its policies affecting SEZs in a manner that adversely impact the incentives for establishing
and operating facilities in SEZs, our business, results of operations and financial condition may be adversely affected.



Political instability could also delay
the reform of the Indian economy and could have a material adverse effect on the market for securities of Indian companies, including
our equity shares and our ADSs, and on the market for our services.



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



Because of our global presence, we are
subject to additional risks related to our international expansion strategy, including risks related to compliance with a wide
variety of treaties, national and local laws, including multiple and possibly overlapping tax regimes, privacy laws and laws dealing
with data protection, export control laws, restrictions on the import and export of certain technologies and national and local
labor laws dealing with immigration, employee health and safety, and wages and benefits, applicable to our employees located in
our various international offices and facilities. We may from time to time be subject to litigation or administrative actions resulting
from claims against us by current or former employees, individually or as part of a class action, including for claims of wrongful
termination, discrimination (including on grounds of nationality, ethnicity, race, faith, gender, marital status, age or disability),
misclassification, redundancy payments under TUPE-type legislation, or other violations of labor laws, or other alleged conduct.
If we are held liable for unpaid compensation, redundancy payments, statutory penalties, and other damages arising out of such
actions and litigations, our revenues and operating profitability could be adversely affected.



In addition, we may face competition
in other countries from companies that may have more experience with operations in such countries or with international operations
generally. We may also face difficulties integrating new facilities in different countries into our existing operations, as well
as integrating employees that we hire in different countries into our existing corporate culture. As an international company,
our offshore and onsite operations may also be impacted by disease, epidemics and local political instability which could have
a material adverse effect on revenues and profitability.



Our international expansion plans may
not be successful and we may not be able to compete effectively in other countries. Any of these events could adversely affect
our revenues and operating profitability.



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



Generally, the RBI must approve any acquisition
by us of any company organized outside of India. The RBI permits acquisitions of companies organized outside of India by an Indian
party without approval if the transaction consideration is paid in cash, the transaction value does not exceed 400% of the net
worth of the acquiring company as of the date of the acquiring company’s latest audited balance sheet, or if the acquisition
is funded with cash from the acquiring company’s existing foreign currency accounts or with cash proceeds from the issuance
of ADRs / GDRs. However, any financial commitment exceeding US$1 (one) billion or its equivalent in a financial year requires
prior approval of the RBI even when the total financial commitment of the Indian company is within 400% of the net worth of the
acquiring company as per the last audited balance sheet.



If we fail to obtain any required approval
from the RBI or any other government agency for acquisitions of companies organized outside India, our international growth may
become restricted, which could negatively affect our business and prospects.



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.



Indian law relating to foreign exchange
management constrains our ability to raise capital outside India through the issuance of equity or convertible debt securities.
Generally, any foreign investment in, or acquisition of, an Indian company does not require the approval from relevant government
authorities in India, including the RBI. However, in a number of industrial sectors, there are restrictions on foreign investment
in Indian companies. Changes to the policies may create restrictions on our capital raising abilities. For example, a limit on
the foreign equity ownership of Indian technology companies or pricing restrictions on the issuance of ADRs / GDRs may constrain
our ability to seek and obtain additional equity investment by foreign investors. In addition, these restrictions, if applied to
us, may prevent us from entering into certain transactions, such as an acquisition by a non-Indian company, which might otherwise
be beneficial for us and the holders of our equity shares and ADSs.



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.



In the past, our ADSs have traded at
a premium to the trading prices of our underlying equity shares on the Indian stock exchanges. We believe that this price premium
has resulted from the relatively small portion of our market capitalization previously represented by ADSs, restrictions imposed
by Indian law on the conversion of equity shares into ADSs and an apparent preference of some investors to trade dollar-denominated
securities. We have completed three secondary ADS offerings which significantly increased the number of our outstanding ADSs. Also,
over time, the restrictions on the issuance of ADSs imposed by Indian law have been relaxed. As a result, our ADSs do not command
any premium currently and may not trade at a premium in the future.



In the past several years, our ADSs have
been converted into equity shares in India as the premium on ADSs compared to equity shares has significantly narrowed. If a substantial
amount of our ADSs are converted into underlying equity shares in India, it could affect the liquidity of such ADSs on the NYSE
and could impact the price of our ADSs.



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



Sales of substantial amounts of our equity
shares, including sales by our insiders in the public market, or the perception that such sales may occur, could adversely affect
the prevailing market price of our equity shares, ADSs or our ability to raise capital through an offering of our securities. In
the future, we may also sponsor the sale of shares currently held by some of our shareholders as we have done in the past, or issue
new shares. We can make no prediction as to the timing of any such sales or the effect, if any, that future sales of our equity
shares, or the availability of our equity shares for future sale, will have on the market price of our equity shares or ADSs prevailing
from time to time.



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



Fluctuations in the exchange rate between
the Indian rupee and the U.S. dollar will affect the dollar conversion by Deutsche Bank Trust Company Americas, the Depositary
with respect to our ADSs, of any cash dividends paid in Indian rupees on the equity shares represented by the ADSs.



Negative media coverage and public
scrutiny may adversely affect the prices of our equity shares and ADSs.



Media coverage and public scrutiny of
our business practices, policies and actions has increased dramatically over the past several years, particularly through the use
of social media. Any negative media coverage in relation to our business, regardless of the factual basis for the assertions being
made, may adversely impact our reputation. Responding to allegations made in the media may be time consuming and could divert the
time and attention of our senior management from our business. Any unfavorable publicity may also adversely impact investor confidence
and result in sales of our equity shares and ADSs, which may lead to a decline in the share price of our equity shares and our
ADSs.



Indian law imposes certain restrictions
that limit a holder’s 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.



Under certain circumstances, the RBI
must approve the sale of equity shares underlying ADSs by a non-resident of India to a resident of India. The RBI has given general
permission to effect sales of existing shares or convertible debentures of an Indian company by a resident to a non-resident, subject
to certain conditions, including the price at which the shares may be sold. Additionally, except under certain limited circumstances,
if an investor seeks to convert the rupee proceeds from a sale of equity shares in India into foreign currency and then repatriate
that foreign currency from India, he or she will have to obtain RBI approval for each such transaction. Required approval from
the RBI or any other government agency may not be obtained on terms favorable to a non-resident investor or at all.



An investor in our ADSs may not
be able to exercise pre-emptive rights for additional shares and may thereby suffer dilution of such investor’s equity interest
in us.



Under the Indian Companies Act, 2013,
a company incorporated in India must offer its holders of equity shares pre-emptive rights to subscribe and pay for a proportionate
number of shares to maintain their existing ownership percentages prior to the issuance of any new equity shares, unless such pre-emptive
rights have been waived by three-fourths of the shareholders voting on the resolution to waive such rights. Holders of ADSs may
be unable to exercise pre-emptive rights for equity shares underlying ADSs unless a registration statement under the Securities
Act of 1933 as amended, or the Securities Act, is effective with respect to such rights or an exemption from the registration requirements
of the Securities Act is available. We are not obligated to prepare and file such a registration statement and our decision to
do so will depend on the costs and potential liabilities associated with any such registration statement, as well as the perceived
benefits of enabling the holders of ADSs to exercise their pre-emptive rights, and any other factors we consider appropriate at
the time. No assurance can be given that we would file a registration statement under these circumstances. If we issue any such
securities in the future, such securities may be issued to the Depositary, which may sell such securities for the benefit of the
holders of the ADSs. There can be no assurance as to the value, if any, the Depositary would receive upon the sale of such securities.
To the extent that holders of ADSs are unable to exercise pre-emptive rights granted in respect of the equity shares represented
by their ADSs, their proportional interests in us would be reduced.



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



The SEBI (Listing Obligations and Disclosure
Requirements), 2015 (“Listing Regulations”) Indian Companies Act, 2013 and the listing agreement with Indian
stock exchanges now provide that an e-voting facility must be mandatorily provided to all shareholder resolutions in accordance
with prescribed procedure under the Companies Act, 2013. This may mean that ADS holders may be able to vote on our resolutions
irrespective of where they are located or whether they are able to attend the meetings of shareholders. At our request, the Depositary
will electronically mail to holders of our ADSs any notice of shareholders’ meeting received from us together with information
explaining how to instruct the Depositary to exercise the voting rights of the securities represented by ADSs. If the Depositary
receives voting instructions from a holder of our ADSs in time, relating to matters that have been forwarded to such holder, it
will endeavor to vote the securities represented by such holder’s ADSs in accordance with such voting instructions. However,
the ability of the Depositary to carry out voting instructions may be limited by practical and legal limitations and the terms
of the securities on deposit. We cannot assure that holders of our ADSs will receive voting materials in time to enable such holders
to return voting instructions to the Depositary in a timely manner. Securities for which no voting instructions have been received
will not be voted. There may be other communications, notices or offerings that we only make to holders of our equity shares, which
will not be forwarded to holders of ADSs. Accordingly, holders of our ADSs may not be able to participate in all offerings, transactions
or votes that are made available to holders of our equity shares.



It may be difficult for holders
of our ADSs to enforce any judgment obtained in the United States against us or our affiliates.



We are incorporated under the laws of
India and certain of our directors and executive officers reside outside the United States. Virtually all of our assets are located
outside the United States. As a result, holders of our ADSs may be unable to effect service of process upon us outside the United
States. In addition, holders of our ADSs may be unable to enforce judgments against us if such judgments are obtained in courts
of the United States, including judgments predicated solely upon the federal securities laws of the United States.



The United States and India do not currently
have a treaty providing for reciprocal recognition and enforcement of judgments (other than arbitration awards) in civil and commercial
matters. Therefore, a final judgment for the payment of money rendered by any federal or state court in the United States on the
basis of civil liability, whether or not predicated solely upon the federal securities laws of the United States, would not be
enforceable in India. However, the party in whose favor such final judgment is rendered may bring a new suit in a competent court
in India based on a final judgment that has been obtained in the United States. The suit must be brought in India within three
years from the date of the judgment in the same manner as any other suit filed to enforce a civil liability in India. It is unlikely
that a court in India would award damages on the same basis as a foreign court if an action is brought in India. Furthermore, it
is unlikely that an Indian court would enforce foreign judgments if it viewed the amount of damages awarded as excessive or inconsistent
with Indian practice. A party seeking to enforce a foreign judgment in India is required to obtain approval from the RBI under
the Foreign Exchange Management Act, 1999, to repatriate any amount recovered pursuant to the execution of such a judgment.



Holders of ADSs are subject to
the Securities and Exchange Board of India’s 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 Securities and Exchange Board of
India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (the Takeover Code) is applicable to publicly listed
Indian companies. Therefore, the provisions of the Takeover Code apply to us and to any person acquiring our equity shares or voting
rights in our company, such as those represented by our ADSs.



The acquisition of shares or voting rights
which entitle the acquirer, along with persons acting in concert with the acquirer, to exercise 25% or more of the voting rights
in or control over the target company triggers a requirement for the acquirer to make an open offer to acquire at least 26% of
the total shares of the target company for an offer price determined as per the provisions of the Takeover Code. The acquirer is
required to make a public announcement for an open offer on the date on which it is agreed to acquire such shares or voting rights.
Such open offer shall only be for such number of shares as is required to adhere to the maximum permitted non-public shareholding.
Further, acquisition of shares or voting rights by an acquirer who holds 25% or more of the voting rights in the target company
(along with persons acting in concert with the acquirer), shall make an open offer to acquire additional shares or voting rights
which entitle the acquirer (along with persons acting in concert with the acquirer) to exercise more than 5% of voting rights in
the target company.



Upon the acquisition of shares or voting
rights in a publicly listed Indian company such that the aggregate share-holding of the acquirer (meaning a person who directly
or indirectly, acquires or agrees to acquire shares or voting rights in a target company, or acquires or agrees to acquire control
over the target company, either by himself or together with any person acting in concert) is 5% or more of the shares of the company,
the acquirer is required, within two working days of such acquisition, to disclose the aggregate shareholding and voting rights
in the company to the company and to the stock exchanges in which the shares of the company are listed.



Further, an acquirer who, together with
persons acting in concert with him, holds shares or voting rights entitling them to 5% or more of the shares or voting rights in
a target company, acquires or sells shares representing 2% or more of the shares or voting rights of the company must disclose,
within two working days of such acquisition, sale or receipt of intimation of allotment of such shares, the acquirer's revised
shareholding to the company and to the stock exchanges on which the shares of the company are listed. This disclosure is required,
in case of a sale, even if such sale results in the shareholding of the acquirer falling below 5%.



The Takeover Code may impose conditions
that discourage a potential acquirer, which could prevent an acquisition of our company in a transaction that could be beneficial
for our equity holders.



If the government of India modifies
dividend distribution tax rates or introduces new forms of taxes on distribution of profits or changes the basis of application
of these taxes, the same could materially affect the returns to our shareholders.





The effective rate of dividend distribution
tax (DDT) is 20.3576%. Our current dividend policy states that dividend pay-out would be up to 50% of post-tax consolidated profits
including dividend tax. If the effective rate of the DDT increases in future, the dividend amount receivable by our shareholders
after taxes may decrease further.



Further the Finance Act 2016 has provided that any income earned by an individual, Hindu Undivided Family
(HUF) or a firm, who is a resident in India, by way of dividend declared, distributed or paid by any domestic company in excess
of Rs.1,000,000 in aggregate shall be chargeable to tax at the rate of 10% on gross basis on such amount exceeding Rs.1,000,000.





Item 4. Information on the Company



COMPANY OVERVIEW



Infosys is a leading provider
of  consulting, technologyand next-generation services.

We enable our clients to renew
and simplify their existing landscapes, and partner with them in designing and implementing new solutions to their most
complex problems in a dynamic business environment.

Our comprehensive end-to-end business
solutions include:

|· | Consulting Services
|- | -------------------

|· | Business Application Services – Enterprise
System implementation and services, Digital solutions and services, Data Analytics, Business Process Management
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------

|· | Technology Services – Application Development,
Modernization & Management, Cloud Infrastructure and Security, Engineering Services, Enterprise Mobility, Internet of Things
(IoT), Software Testing
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|· | Outsourcing Services –
                                                                                                           Application Outsourcing, Business Process Outsourcing including Customer Service, Finance & Accounting, Human Resources,
                                                                                                           Sourcing & Procurement Process Outsourcing
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|· | Our
                                         products and platform solutions include Mana, the Infosys Information Platform (IIP),
                                         the Edge suite of Products, Skava, Panaya and FinacleTM, an industry-leading
                                         universal banking solution.
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Our
“Global Delivery Model” is based on a scalable infrastructure that results in multiple efficiencies for our clients.
We divide projects into components that we execute simultaneously at client sites and at our Development Centers in India and
around the world. We optimize our cost structure by maintaining the flexibility to execute project components where it is most
cost effective. We are then able to execute project components around the clock and across time zones, to reduce project delivery
times.

We
believe we have some of the best talent in the technology services industry, and we are committed to be among the industry’s
leading employers.

We
have organized our sales and marketing departments into teams that focus on specific geographies and industries, enabling us to
better customize our service offerings to our clients’ needs. Our primary geographic markets are North America, Europe,
India and Rest of the World which generated 62.7%, 23.0%, 2.6% and 11.7% of our revenues in the fiscal year ended March 31, 2016.
We serve clients in financial services; manufacturing; energy & utilities, communications and services; retail, consumer packaged
goods and logistics; life sciences, healthcare and insurance and Hi-tech.

Our
revenues grew from $6,994 million in fiscal 2012 to $9,501 million in fiscal 2016, representing a compound annualized growth rate
of 8.0%. Our net income grew from $1,716 million to $2,052 million during the same period, representing a compound annualized
growth rate of 4.6%. Between March 31, 2012 and March 31, 2016, our total employees grew from 149,994 to 194,044, representing
a compound annualized growth rate of 6.6%.

|A. | HISTORY AND DEVELOPMENT OF THE COMPANY
|-- | --------------------------------------



We were incorporated on July
2, 1981 in Maharashtra, India, as Infosys Consultants Private Limited, a private limited company under the Indian Companies Act,
1956. We changed our name to Infosys Technologies Private Limited in April 1992 and to Infosys Technologies Limited in June 1992,
when we became a public limited company. In June 2011, we changed our name from Infosys Technologies Limited to Infosys Limited,
following approval of the name change by our Board, shareholders and the Indian regulatory authorities. The name change was intended
to reflect our transition from a provider of technology services to a partner with our clients solving business problems by leveraging
technology. We made an initial public offering of equity shares in India in February 1993 and were listed on stock exchanges in
India in June 1993. We completed our initial public offering of ADSs in the United States in 1999. In August 2003, June 2005 and
November 2006, we completed sponsored secondary offerings of ADSs in the United States on behalf of our shareholders. Each of
our 2005 and 2006 sponsored secondary offerings also included a public offering without listing in Japan, or POWL. In 2008, we
were selected as an original component member of 'The Global Dow', a world-wide stock index made up of 150 leading blue-chip stocks.
Following our voluntary delisting from the NASDAQ Global Select Market on December 11, 2012, we began trading of our ADSs on the
New York Stock Exchange (NYSE) on December 12, 2012, under the ticker symbol INFY. On February 20, 2013, we also listed our ADSs
on the Euronext London and Paris (previously called NYSE Euronext (NYX) London and Paris) markets, under the ticker symbol INFY.



Infosys
BPO Limited (Infosys BPO) is our majority-owned and controlled subsidiary. Infosys Technologies (Australia) Pty. Ltd (Infosys Australia),
Infosys Tecnologia do Brasil Ltda (Infosys Brasil), Infosys Technologies (China) Co. Limited (Infosys China), Infosys Technologies
S. de R. L. de C.V (Infosys Mexico), Infosys Technologies (Sweden) AB (Infosys Sweden), Infosys Public Services, Inc. (Infosys
Public Services), Infosys Technologies (Shanghai) Co. Limited (Infosys Shanghai), Infosys Americas Inc. (Infosys Americas), EdgeVerve
Systems Limited (EdgeVerve), Infosys Consulting Holding AG (Infosys Lodestone) (formerly Lodestone Holding AG), Panaya Inc.(Panaya),
Infosys Nova holdings LLC. (Infosys Nova), Kallidus Inc. (d.b.a Skava) (Kallidus), Skava Systems Private Ltd. and Noah Consulting
LLC (Noah) are our wholly-owned and controlled subsidiaries.



The address
of our registered office is Electronics City, Hosur Road, Bangalore-560 100, Karnataka, India. The telephone number of our registered
office is +91-80-2852-0261. Our agent for service of process in the United States is CT Corporation System, 1350 Treat Boulevard,
Suite 100, Walnut Creek, CA 94597-2152. Our website address is www.infosys.com and the information contained in our website does
not constitute a part of this Annual Report.



Principal Capital Expenditures and
Divestitures



In fiscal 2016, 2015 and 2014, we spent
$413 million, $367 million and $451 million, respectively, on capital expenditures. As of March 31, 2016, we had contractual commitments
of $224 million for capital expenditure. These commitments included $181 million in domestic purchases and $43 million in overseas
commitments for hardware, supplies and services. All our capital expenditures were financed out of cash generated from operations.



The Hon’ble High Court of Karnataka
sanctioned the scheme of amalgamation of Infosys Consulting India Limited (ICIL) with Infosys Limited with an effective date of
August 23, 2013. Accordingly, all the assets and liabilities of ICIL were transferred to Infosys Limited on a going concern basis.
As ICIL was a wholly owned subsidiary of Infosys Limited, no shares have been allotted to the shareholders upon the scheme becoming
effective.







We incorporated a wholly owned subsidiary,
Infosys Americas Inc., on June 25,2013.





EdgeVerve was created as a wholly
owned subsidiary on February 14, 2014 to focus on developing and selling products and platforms. On April 15, 2014, the Board
authorized the Company to execute a Business Transfer Agreement and related documents with EdgeVerve, subject to securing the
requisite approval from shareholders in the Annual General Meeting. Subsequently, at the AGM held on June 14, 2014, the
shareholders have authorized the Board to enter into a Business Transfer Agreement and related documents with EdgeVerve, with
effect from July 1, 2014 or such other date as may be decided by the Board. We have undertaken an enterprise valuation by an
independent valuer and accordingly the business has been transferred to the Company’s wholly owned subsidiary for a
consideration of $70 million (421 crore) with effect from July 1, 2014 which is settled through the issue of fully paid-up
equity shares of such subsidiary. The transfer of assets and liabilities between entities under common control is accounted
for at carrying values and does not have any impact on the consolidated financial statements.



Further, on April 24, 2015, the Board authorized the Company to execute a Business Transfer Agreement and
related documents with EdgeVerve, to transfer the business of Finacle and EdgeServices. After the requisite approval from the shareholders
through postal ballot on June 4, 2015, a Business Transfer Agreement and other related documents were executed with EdgeVerve to
transfer the business with effect from August 1, 2015. We have undertaken an enterprise valuation by an independent valuer and
accordingly the business were transferred for a consideration of approximately $491 million and approximately $27 million for Finacle
and EdgeServices, respectively. The consideration was settled through issue of 850,000,000 equity shares amounting to approximately
$129 million and 254,900,000 non-convertible redeemable debentures amounting to approximately $389 million in EdgeVerve, post the
requisite approval from shareholders on December 11, 2015. The transfer of assets and liabilities was accounted for at carrying
values and did not have an impact on the consolidated financial statements.





On January 23, 2015, a wholly owned subsidiary,
Infosys Nova Holdings LLC, was incorporated. Infosys Nova acquired 20% of the equity interests in DWA Nova LLC for a cash consideration
of $15 million. The Company has made this investment to form a new company along with Dream Works Animation (DWA). The new company,
DWA Nova LLC, will develop and commercialize image generation technology in order to provide end-to-end digital manufacturing capabilities
for companies involved in the design, manufacturing, marketing or distribution of physical consumer products. As of March 31, 2016,
Infosys Nova holds 16% of the equity interest in DWA Nova LLC





On March 5, 2015, Infosys acquired 100%
of the voting interests in Panaya Inc., a Delaware Corporation in the United States. Panaya is a leading provider of automation
technology for large scale enterprise and software management. The business acquisition was conducted by entering into a share
purchase agreement for cash consideration of $225 million. Panaya’s CloudQualityTM suite positions Infosys to bring
automation to several of its service lines via an agile SaaS model, and helps mitigate risk, reduce costs and shorten time to market
for clients.



On June 2, 2015, Infosys acquired 100%
of the voting interests in Kallidus Inc. U.S, a leading provider of digital experience solutions, including mobile commerce and
in-store shopping experiences to large retail clients and 100% of the voting interests of Skava Systems Private Limited, India,
an affiliate of Kallidus. The business acquisition was conducted by entering into a share purchase agreement for cash consideration
of $91 million and a contingent consideration of up to $20 million. The payment of the contingent consideration to sellers of Kallidus
is dependent upon the achievement of certain financial targets by Kallidus over a period of 3 years ending on December 31, 2017.
Infosys expects to help its clients bring new digital experience to their customers through IP-led technology offerings, new automation
tools and skill and expertise in these new emerging areas.



On November 16, 2015, Infosys acquired 100% membership interest in Noah Consulting, LLC, a leading provider
of advanced information management consulting services for oil and gas industry. This acquisition combines Noah’s industry
knowledge, information strategy planning, data governance and architecture capabilities with Infosys’ ability to provide
technology and outsourcing services on a global scale to oil and gas clients. The business acquisition was conducted by entering
into a share purchase agreement for a cash consideration of $33 million, a contingent consideration of up to $5 million and an
additional consideration of up to $32 million, referred to as retention bonus payable to the employees of Noah at each anniversary
year following the acquisition date for the next three years, subject to their continuous employment with the group at each anniversary.
The payment of the contingent consideration to the sellers of Noah was dependent upon the achievement of certain financial targets
by Noah for the year ended December 31, 2015 and year ending December 31, 2016. During year ending March 31, 2016, based on an
assessment of Noah achieving the targets for the year ended December 31, 2015 and year ending December 31, 2016, the entire contingent
consideration has been reversed in the statement of comprehensive income.





|B. | BUSINESS OVERVIEW
|-- | -----------------



INDUSTRY OVERVIEW



Software and computing technology is
transforming businesses in every industry around the world in a very profound and fundamental way. The continued reduction in the
unit cost of hardware, the explosion of network bandwidth, advanced software technologies and technology enabled services are fueling
the rapid digitization of business processes and information. Traditional business models are being disrupted in every industry
with digital and software based business models. This disruption is characterized by highly desirable user experiences, an extreme
scale of cost performance that has become available in computing infrastructure and disintermediation of the supply chain. Leveraging
technologies and models of the digital era to both extend the value of existing investments and, in parallel, transform and future
proof their businesses is increasingly becoming a top priority for business leaders. This duality – to renew existing
core businesses and innovate new businesses – is the essence of what companies are faced with as strategic imperatives
today.



From an IT perspective, the renewal translates
to harnessing the efficiency of distributed cloud computing, enabling legacy systems for mobile and sensor access, extracting value
out of digitized data, keeping systems relevant and optimizing the costs of building and running technology systems. And as businesses
look to new areas and new economics, new and intelligent systems are required to be built with next generation technologies and
with exponentially superior cost benefit performance.



The fast pace of technology change and
the need for technology professionals who are highly skilled in both the renewal and new technology areas are driving businesses
to rely on third parties in order to realize their IT transformation. Several technology solution and service providers have emerged
over the years, offering different models for clients to consume their solution and service offerings:



|· | Technology consulting companies – who take on niche and time bound projects for their clients                                                                                                       
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|· | Global IT outsourcing companies – who leverage global talent pools to systematically optimize the IT operations of clients                                                                          
|· | Business process outsourcing firms – who leverage global talent pools to manage outsourced core business processes of their clients                                                                 
|· | Software firms – who provide licensed software that enable the automation of business processes                                                                                                     
|· | Specialty platform and Software-as-a-Service companies – who provide utility based models for clients to consume software features                                                                  
|· | Data analytics companies – who specialize in designing, analyzing and reporting insights from the vast amount of data that corporations are collecting about their customers, operations and markets
|· | Internal IT departments of the companies themselves, usually a cost center for the corporation.                                                                                                     



OUR COMPETITIVE STRENGTHS



We believe our strengths give us the competitive advantage
to position ourselves as the leading global solutions and services company.



|1. | Consulting and domain expertise: Our specific industry, domain,
process, and technology expertise allows us to enable clients transform their businesses with innovative strategies and solutions.
Our expertise helps our clients enhance their performance, gain process and IT efficiencies, increase agility and flexibility,
reduce costs, and achieve measurable business value.
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2. | Breadth of offerings: Our suite of
comprehensive end to end business solutions includes business and technology consulting, enterprise solutions, systems integration,
custom application development, application maintenance and production support, infrastructure management, independent testing
and validation, cloud ecosystem integration, product engineering and lifecycle solutions, business process management, software
products, and business platforms and solutions.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3. | Intellectual
                                         property in platforms, products: Our products, platforms and solutions are geared
                                         to sense, influence, fulfil, and serve the needs of digital
                                         consumers as well as leverage the potential of their business ecosystem.
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4. | Experience and expertise in large scale
outsourcing: We have developed processes and frameworks for large scale outsourcing of technology projects that minimize financial
and business risk to our clients. Our Global Delivery Model divides projects into components that can be executed simultaneously
at client sites and at our development centers in India and around the world. We optimize our cost structure by maintaining the
flexibility to execute project components where it is most cost effective. This is further strengthened with automation, intelligence
and collaboration technologies.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|5. | Deep client relationships and brand:
We have long standing relationships with large corporations and other organizations. Our track record in delivering high quality
solutions across the entire software lifecycle and our strong domain expertise helps us to solidify these relationships and gain
increased business from our existing clients. This history of client retention allows us to showcase and strengthen our brand.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|6. | Quality and process execution: Our
sophisticated processes, standards and quality frameworks allow us to continuously optimize service delivery of various engagements
on key performance indicators like business value, productivity, quality and cycle-time.
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|7. | High quality talent: We have a strong
ecosystem for employee attraction, career development, engagement and retention through a trusted partnership with our stakeholders.
Competence development of our workforce has always been our key strategic focus area.We have a culture of performance and
innovation in an open and collaborative environment.
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



OUR STRATEGY



Our strategic objective is to build a sustainable organization
that remains relevant to the agenda of our clients, while generating profitable growth for our investors. In order to do this,
we will apply the priorities of “renew” and “new” to our own business and cascade it to everything we do.



These translate to the following strategic
focus areas:



Build expansive, lasting relationships
with our clients by delivering differentiated market offerings:



Our strategy is to engage with clients
on their large transformative programs, both in traditional IT areas as well as for their new digital business initiatives. We
expand existing client relationships by providing them a broad set of end-to-end service offerings and increase the size, nature
and number of projects we do with them. Our specific industry, domain, process, and technology expertise allows us to enable clients
transform their businesses with innovative strategies and solutions. Through our transformation service offering, which we call
“AiKiDo,” we help our clients address key aspects of their business. Our “Ai” offering, a result of our
investments in building intellectual property, helps clients leverage software based platforms to dramatically boost productivity
and to deliver next generation experiences to their customers. Our “Ki” offering captures the know-how of existing
client technology landscapes, which we then leverage for process improvements and transformation. With our “Do” offering,
which incorporates design thinking concepts, we help clients identify and prioritize their most significant problems and solve
them in rapid, iterative and innovative ways. We offer an end-to-end suite of high quality, highly responsive and innovation led
services spanning business consulting, IT services, software platform-based services and business process management. This enables
us to partner with our clients on large, multi-year engagements.



Through our Zero Distance program, we help our clients innovate and derive more value from their projects.
Zero Distance is the process of everyday innovation at Infosys whereby all employees are expected to innovate in their individual
capacities and through their individual jobs. Zero Distance has a three-fold emphasis: to reduce the gap between us and the code
we write, the gap between us and our clients and the gap between us and the ultimate end user.



We also plan to acquire new clients,
and increase our presence in new geographies and market segments by investing in targeted business development and marketing. We
will position our brand as differentiated, global and respected.



Deliver solutions and services leveraging
highly cost effective models:



Our strategy is to leverage software
based automation and our Global Delivery Model to deliver solutions and services to our clients in the most cost effective manner,
while at the same time optimizing our cost structure to remain competitive.



We are embracing artificial intelligence
based automation techniques and software automation platforms to boost productivity of our projects. We are leveraging software
process engineering and collaboration technologies to improve process productivity.



Our Global Delivery Model provides scale,
quality, expertise, cost and time-to-market advantages to our client projects. The model enables us to perform work at the location
where the best talent is available and where it makes the best economic sense with the least amount of acceptable risk. Over the
last thirty years, we have developed our distributed execution capabilities to deliver high quality and scalable services. This
scalable infrastructure complements our ability to deliver project components that are executed round the clock and across time
zones enabling us to reduce project delivery times.



Enhance our operational processes for
agility and optimal cost:



We periodically assess the effectiveness
of our organization structure and processes to optimize it for alignment with our strategic objectives and agility. We continually
evaluate critical cross functional processes and benchmark them with best in class practices to optimize costs and enable swift
and effective response to our clients. We constantly monitor and optimize various operational parameters such as the cost and utilization
of resources, distribution of employees around the world, the cost of operating our campuses and whether we are optimally realizing
the efficiencies of scale.



Last year, we launched our Zero Bench program. This program allows us to effectively deploy our un-utilized
resources into internal projects. Zero Bench enables employees to fulfill their professional aspirations while, at the same time,
helps us to improve our employee engagement and our operational efficiency.



Attract and retain a global, diverse,
motivated and high performing employee base:



Our employees are our biggest asset.
To meet the evolving need of our clients, our priority is to attract and engage the best talent in the right locations with the
right skills. We offer our employees challenging work assignments, benchmarked compensation and a collaborative, productive work
environment. Our performance management system is based on objectivity and rewards performance. We invest substantially in employee
engagement to motivate employees and encourage social communication and collaboration.



Teaching and learning is central to the
Infosys culture. Our investments in our Global Education Center and in creating various learning opportunities for our employees
help our employees stay abreast of new developments in software technologies, spur innovation and help them build a lifelong career
at Infosys.



We are guided by our value system which
motivates our attitudes and actions. Our core values are Client Value, Leadership by Example, Integrity and Transparency, Fairness
and Excellence (C-LIFE).



Pursue strategic alliances and acquisitions:



We leverage alliances that complement
our core competencies. We partner with leading technology software and hardware providers in creating, deploying, integrating and
operating business solutions for our clients. We have also expanded the scope of our collaborations to encompass universities and
research organizations.



We will deploy our capital in making
selective business acquisitions that augment our expertise, complement our presence in certain market segments and accelerate the
execution of our strategies.



We have an innovation fund with an outlay of $500 million to tap into innovation networks of early stage companies
and universities to gain access to new thinking and business models.



OUR STRUCTURE





Our
go-to-market business units are organized as:





|- | Financial Services
|- | ------------------

|- | Manufacturing
|- | -------------

|- | Retail, CPG & Logistics
|- | -----------------------

|- | Energy, Utilities, Communications
& Services
|- | --------------------------------------------

|- | Hi-tech
|- | -------

|- | Life Sciences, Healthcare &
Insurance
|- | -------------------------------------

|- | China
|- | -----

|- | Japan
|- | -----

|- | India
|- | -----

|- | Infosys Public Services
|- | -----------------------





Our
service delivery is organized as horizontal centers of excellence:





| | - | Infosys Global Consulting
| | - | -------------------------

| | - | Global Delivery
| | - | ---------------

| | · | Enterprise Solutions
| | - | --------------------

| | · | Infosys Digital
| | - | ---------------

| | · | Enterprise Mobility
| | - | -------------------

| | · | Application Development Services
| | - | --------------------------------

| | · | Application Management Services
| | - | -------------------------------

| | · | Application Modernization Services
| | - | ----------------------------------

| | · | Independent Validation Solutions
| | - | --------------------------------

| | · | Data and Analytics
| | - | ------------------

| | · | Engineering Services
| | - | --------------------

| | · | Cloud and Infrastructure Services
| | - | ---------------------------------

| | · | Infosys Center for Emerging Technology
Solutions
| | - | ------------------------------------------------

| | - | Products
| | - | --------

| | · | FinacleTM
| | - | ---------

| | · | EdgeVerve
| | - | ---------

| | - | Platforms
| | - | ---------

| | · | Panaya
| | - | ------

| | · | Mana
| | - | ----

| | - | Skava
| | - | -----

| | - | Infosys BPO
| | - | -----------



OUR SOLUTIONS



We provide our clients with a full range
of business and technology services, comprising of the following service lines.



1) Infosys Global Consulting (IGC)



Infosys
Global Consulting helps global corporations in more than 20 countries develop unique solutions to address their complex business
challenges and create value through sustainable innovation. Our approach, with an eye on execution,
combines creative thinking, technological expertise and global reach to enable companies achieve market-leading performance. We
use Design Thinking to drive innovation for our clients whilerenewing their IT landscapes non-disruptively. We go beyond
being traditional advisors and develop innovative strategies and solutions for clients by combining new technologies, open source
software and start-up ideas.

We
are defining, designing and delivering value to corporations across industries such as financial services, insurance, retail,
consumer packaged goods, logistics, energy, utilities, healthcare, life sciences, manufacturing, communications and services (e.g.
airlines, hospitality) and Hi-tech in the US, Latin America, Europe, Asia, Australia, New Zealand and other geographies.

We
offer consulting services in the following areas: Strategy and Architecture, Business Transformation, Enterprise Processes, Enterprise
Applications, Digital Transformation, Insights and Analytics, and Change and Learning.

Strategy
and Architecture: We enable clients to get the best value from technology by developing an IT strategy, optimizing applications
and infrastructure, implementing IT operating models, and governing the technical architecture for reliability and security.

Business
Transformation: We enable clients to define and deliver technology-enabled transformations of their business. We also help
clients implement their transformation strategy (including M&A), and manage and govern these programs.

Enterprise
Processes: We design the overall process model and eliminate organizational gaps to help clients achieve efficient processes.
We also aid in building their supply chain and operation capabilities, addressing key challenges in finance functions and enhancing
employee productivity.

Enterprise
Applications: We offer Enterprise Application-enabled business transformation programs, and design
and implementation of Oracle and SAP solutions. Our experience and knowledge in HANA strategy and technical architecture help
us build HANA capabilities for clients. We offer HANA advisory and center of excellence services, platform services and business
suite for HANA (S/4).

Digital
Transformation: Enabling clients to focus on their complete value chain, we offer customer relationship
management, multi-channel commerce and digital marketing to improve customer experience and increase customer acquisition.

Insights
and Analytics:We help clients utilize data, insights and real-time predictive analysis for better decision-making and optimizing
processes. We provide a holistic service package from strategy to implementation, as well as advice
on running master data management programs internally or externally.

Change
and Learning:We help clients define and implement change agendas to streamline business objectives
and enable new operational structures. We leverage latest technologies and social trends to help them enhance and retain knowledge,
reduce learning costs, and comply with regulatory requirements.

Infosys
Global Consulting is also leading the way in taking Infosys’ next generation suite of services, AiKiDo, which is based on
platforms, knowledge-based IT and design thinking that apply to enterprises globally. AiKiDo aims to help clients address three
key aspects of their business: a non-disruptive renewal and simplification of their existing landscapes, introduction of new offerings
and models in a dynamic business environment, and creating a culture of innovation in their organizations.

Airefers to platforms and platforms as a service to build intelligent solutions. It helps harmonize and unify the disjointed
initiatives in enterprises and build solutions to emerging business problems.

Kirefers to knowledge-based management and evolution of landscapes which captures the knowledge within an organization –
people, structures and systems – over time. It is a modular service that systematically harvests and curates enterprise
knowledge to renew existing technology landscapes, optimize business processes and drive rapid innovation

Dorefers to our service offering on design thinking-led initiatives that will help clients find, understand and define the problems
that are most important to their businesses.It also helps in prioritizing problems and solving
them effectively and quickly.

Noah
Consulting: In fiscal 2016, Infosys acquired Noah Consulting LLC, a leading provider of advanced information management consulting
services for the oil and gas industry. Noah Consulting’s vast knowledge of industry, information strategy planning, data
governance and architecture capabilities effectively complement our expertise in technology and outsourcing services, and together,
we offer next-generation data analytics solutions to our clients in the oil and gas sector.



2) Global Delivery



Enterprise Solutions (SAP, Oracle and EAIS)



SAP



The Infosys SAP practice provides SAP
services to help our clients transform their operations, streamline and standardize business processes to ensure consistency across
countries, consolidate platforms, and replace legacy systems with SAP applications. Our core SAP offerings include end-to-end SAP-enabled
business transformation, package evaluation, package implementation services, global deployments, upgrades, master data management,
business intelligence and analytics (HANA and S/4HANA), integration, mobility solutions, enterprise risk management, enterprise
performance management, SAP basis and technology, and production support and maintenance services. We have a strong focus on the
latest SAP technologies and products, and also provide platform-based offerings to our clients. Additionally, this Practice has
expertise in industry-specific SAP solutions.



Oracle



The Infosys Oracle Practice provides
end-to-end Oracle offerings to help transform our clients’ businesses and enterprise resource planning (ERP) landscape. Our
focus is on Oracle implementations, business transformation services, global rollouts, and application development, support and
maintenance offerings. We have deep expertise across Oracle products and platforms, including next-generation offerings in Fusion
Apps, Exa capabilities, and Oracle Cloud offerings in Human Capital Management (HCM) and Customer Relationship Management (CRM).
We have developed industry-specific Oracle solutions that our clients have implemented. We have also made significant investments
in delivering core Oracle technologies, including the establishment of exclusive joint innovation centers and Centers of Excellence
(CoEs) that are used in our client engagements.



Enterprise Application Integration Services (EAIS)



At
the core of Enterprise Application Integration Services (EAIS) is bringing together disparate systems through the use of next
generation integration technologies along with best of breed enterprise applications. The fundamental themes of our offering is
around helping customers renew their core business and innovate into new business through accelerated digitization of processes
and technology through for example, Service Oriented Architecture (SoA), Business Process Management (BPM) and Application Program
Interface (API) etc. along with Supply Chain Management (SCM) solutions like Maximo and Microsoft Dynamics based solutions. The
focus areas are:

|· | BPM
                                         solutions to help global enterprises overcome business challenges through process orchestration,
                                         rules implementation, simplify business process, improve productivity, reduce costs,
                                         and significantly reduce time-to-market.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|· | SoA
                                         & EAI offers standardized and centralized integrated solutions to optimize SoA transformation
                                         for global enterprises with in-depth and clear-cut SoA strategy, architecture, and implementation
                                         offerings.
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|· | A
                                         dedicated competency center focused on implementing APIs as the new method of connecting
                                         and developing new applications, within and outside the enterprise. The API economy is
                                         enabling rapid response to ever changing business requirements, new application development
                                         and new business models.
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|· | SCM
                                         & Enterprise Asset Management (EAM) have in-depth expertise in creating point solutions
                                         on Order Management, Warehouse Management, planning, procurement solutions across industries
                                         with dedicated centers of excellence for multiple product offerings.
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|· | Microsoft
                                         Dynamics caters to the business needs of both the large enterprises and mid-sized organizations
                                         by providing end-to-end services on Microsoft DynamicsTM AX, Microsoft DynamicsTM
                                         NAV, and Microsoft DynamicsTM CRM. These solutions lower the total cost of ownership
                                         and ensure higher and quicker return on investment, thus enabling customers to use Microsoft
                                         DynamicsTM to maximize their business value and improve their competitiveness.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Infosys Digital



Digital technology continues to impact
our world through its transformative capability and pervasive impact, and is on the top of the agenda for most of our clients,
leading to a strong demand. Infosys' Digital Practice focuses and works with our customers across four areas: Experience, Digitization,
Connected Devices and New Business Models.



Experience: We focus on enabling
our customers to better connect with consumers, partners and employees. Our specific offerings in this area are an omni-channel
experience, omni-channel commerce, digital marketing, and developing a workforce of the future.



Digitization: We focus on optimizing
operations and simplifying processes for our customers, to enable them to provide better experiences. Our specific offerings include
the digitization and simplification of processes, business process management, process SaaSification (Software on the Cloud) wrap
and renew, and supply chain planning and fulfillment.



Connected Devices: We enable our
customers to collaborate and engage in new ways of leveraging the world of connected devices. We provide services based on connected
devices, wearables, and IoT.



New Business Models: We work with
our clients to help them create new business models and new product possibilities. We provide services aimed at using the API economy,
and also work with our customers to build industry-specific digital solutions.



We ensure the success of digital transformation
programs for clients by not only providing innovative solutions, but also ensuring their timely execution. We also seek to enable
our clients to look at digital transformation holistically across consumerization, enterprise and the ecosystem, and provide them
an end-to-end view and capabilities across the consulting, creative, technology and operations functions.



Enterprise
Mobility



As smart devices (phone, tablets and wearables)
rapidly become more pervasive and intrinsic in our lives, enterprises are eagerly looking at ways to leverage this phenomenon and
transform their business. The Enterprise Mobility Practice at Infosys plays a pivotal role in ‘smart devices-led digital
transformation’ for our clients. We work across all industries and help clients create a smarter workforce, enhance customer
intimacy and simplify operations.



This Practice provides comprehensive solutions
and capabilities to our clients, from consulting services, to design, implementation and support. Our approach which focuses on
the ‘end user’, while placing emphasis on experience and short-burst execution cycles, delivers timely and valuable
solutions to clients. We work in a collaborative manner with clients and end users, to identify transformation opportunities, define
the transformation roadmap, co-create, innovate and implement
the right solutions and tools for the client.



We accelerate the deployment of mobility-driven
solutions through our pre-built solutions and reference architectures, industry-leading tools and frameworks, and an eco-system
of innovative partner capabilities. In the fast-changing and innovative mobile world, investing in creating a sustainable engine
is essential.



We continue to invest in mobile research
initiatives, mobile devices labs, and the latest tools aimed at testing and automation, our Mobile Academy, User Experience (UX)
Labs, and in our mobile centers of excellence along with enhancing the SKAVA mobility platform. Our alliances, acquisitions and
partnerships with strategic and innovative players are essential to delivering a comprehensive mobility experience to our clients.
In fact, Infosys sees mobility as a pivotal element of our customers' digital transformation journey.



Application Development Services



We develop customized software solutions
for our clients through projects that leverage a combination of our technical capabilities, domain understanding, consultative
capabilities, intellectual property assets and methodologies. We aim to provide high-quality solutions that are secure, easy-to-deploy
and modular, to facilitate enhancements and extensions. Our proprietary methodologies also allow our software applications to integrate
stringent security measures throughout the software development lifecycle. Infosys' vast pool of consultants and certified
program management professionals help our clients execute both projects and large transformation programs.



With the rapid embrace of Digitization
by our clients, Infosys has taken the lead to move away from the traditional waterfall development approach to an Agile &
Scrum based approach supported by a robust DevOps framework. Infosys’ global Agile and Virtual Scrum (distributed Agile
project execution platform) solutions embody the best practices developed from more than 1000 projects. These best practices
enable clients to leverage the benefits of globally distributed teams while retaining all the advantages of co-located Agile teams.
Additionally, the service virtualization and continuous delivery frameworks, as part of the Infosys DevOps Ecosystem, ensure that
not just the development, but also the delivery of IT solutions, embrace agility, which is the ultimate goal of our clients.



Our accelerated development ecosystem
improves business agility and cycle time by leveraging standardized technical and business assets. Our Rapid Prototyping tool helps
us engage with clients more effectively when gathering software requirements, and our Tabletop solution provides best-in-class
collaboration to enable distributed story creation, design and development. Our Value Realization Method (VRMTM)helps
clients maximize business value early on in the lifecycle of a project, by driving measurable results along with Business Value
Articulation (BVA), through process improvements, to ensure we track value effectively.



Application Management Services



Our Application Management Services help
our clients reduce their cost of IT operations, deliver higher business value, and bring technology innovation, to transform and
grow their business. We bring in efficiencies through an industrialized, IP-based service delivery model. Through our automation
platform, we enhance productivity and ensure consistent high quality service delivery. Using machine learning algorithms and natural
language processing, we are able to mine rich insights from IT support data and drive IT improvement strategies.



We help improve business availability through
proactive monitoring of critical business processes using one of our IPs, thus reducing the impact of any potential business disruption.
We have a structured, tool-based approach towards application portfolio analysis, which helps our clients harvest more value from
existing assets. We also help our clients tap new technologies, to further grow and transform their business.



We have a dedicated team, which continuously
monitors technology and business trends, and develops solutions and accelerators that enable us to deliver best-in-class application
management services to our clients.



Application Modernization Services



Our Application Modernization Services
help modernize legacy systems to enhance flexibility, mitigate risk, minimize disruption, and lower costs. We address issues in
the legacy system such as multiple technology platforms, high cost of maintenance, unsupported systems, shrinking employee expertise,
lack of integration, and web capabilities. The services provide a metrics-based framework to help our clients choose from various
modernization methods – such as web enabling, re-engineering, re-hosting, componentization, and new development.





Independent Validation Solutions



Our Independent Validation Solutions Practice
offers end-to-end validation solutions, and specialized testing services, such as SoA testing, data warehouse testing, package
testing, test consulting and other testing services, to clients across various industry verticals. Also, in response to changing
market and client demands, we have introduced new service offerings such as cloud testing, infrastructure testing, test environment
management, agile testing and security testing. Our quality assurance solutions are aimed at building high reliability and predictability
in our client technology systems, keeping in mind the time-to-market and optimization constraints.



We have invested internally in developing
technology-based solutions for test lifecycle automation, non-functional testing and vertical-specific testing. We have also built
alliances with leading test tool vendors such as Hewlett-Packard Company (HP), IBM, Microsoft Corporation, CA, Inc., Parasoft Corporation,
Micro Focus International plc, Compuware Corporation and TestPlant Ltd., and are involved in building joint solutions with some
of these alliance partners. These testing solutions facilitate high reliability in our clients’ applications and products,
while enabling us to deliver such solutions cost-effectively and with a reduced time-to-market. Our dedicated testing professionals
are trained at an in-house testing academy in various areas, including industry domains, technology, quality processes, testing
methodologies and project management. We also use a best-of-breed approach to include industry-standard tools and our proprietary
IP to achieve significant benefits across the testing lifecycle through the Infosys Test Lifecycle Platform, test management and
data testing workbenches.



Our engagements span multiple geographies
across business lines of our clients. We provide a broad range of services, including independent testing, maintenance testing,
package testing for implementations, upgrades and roll outs, functional automation, performance testing, test process maturity
assessment, Test Center of Excellence (TCoE) design and implementation, quality assurance transformation, and user acceptance testing.
We provide these offerings through a ‘Managed Testing Services’ model, with centers of specialization for test automation,
performance testing, data warehouse testing, SOA testing, test data management, infrastructure testing and user acceptance testing.
With our managed testing services model and our test consulting services, we have played a key role in transforming our clients’
testing organizations, leading to continuous improvements in quality at reduced costs.



Data
and Analytics

Our
Data and Analytics (DNA) service helps customers realize business value from their data and drive superior business performance
through better visibility and decision-making.



We work
with customers across the entire lifecycle of their data, right from defining their DNA strategy, to defining and implementing
their enterprise information architecture, data acquisition and transformation from disparate data sources, and organizing data
to arrive at meaningful conclusions and derive actionable information and insights that are delivered through multiple channels,
including self-service options. We also prescribe solutions to their business problems, and predict future outcomes of their business
processes through the use of statistical analysis, data mining, mathematical modeling, predictive analysis and
data visualization tools, which finally leads to the application of robotics, machine learning and business process automation
that relies on continuously accumulated knowledge and data to improve the efficiency of their business process.



We help
customers achieve all this using systems that can work with the huge data volumes that come with the increasing speed of business,
and enables near real-time insights through high-speed data ingestion and processing capabilities. The ‘Infosys Information
Platform’ provides such capabilities with a reduced time-to-market, and significantly lowers the cost envelope for driving
insights and predictive and prescriptive analytics.



Infosys
is able to achieve this through a talented pool of people having rich industry and technology expertise honed over several engagements
with our customers, our dedicated centers of excellence in the areas of enterprise performance management, big data, mobile BI
and data visualization, a full-stack open source-based platform that reduces the time-to-market and total cost of ownership for
our customers, and a set of tools, IP and accelerators that bring in speed, predictability, agility, accuracy, higher quality,
higher productivity and an industrialized approach to our engagements with our customers.



The
Practice’s service offerings include:



|· | DNA
    Strategy Consulting: define DNA strategy, roadmap and governance, advice on technology, architecture choices and assist
    our clients build their data, analytics and business intelligence competency centers.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | Big
    Data, Architecture and Technology Consulting: define and implement end-to-end enterprise information architecture, and
    enable clients to move onto the Infosys Information Platform.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | Data
    Integration and Extract, Transform and Load (ETL): provide end-to-end services for building enterprise data warehouses,
    data marts, and data stores. This includes building best-in-class data models or adopting industry-specific models and building
    the entire data provisioning layer using ETL tools.
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | Master
    Data Management (MDM), Data Quality and Governance: define and implement MDM platforms using tools and custom technologies,
    and industry-specific data quality and governance services.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | Business
    Intelligence and Reporting: Our information delivery services include reporting, dashboards and analytics.
|- | -----------------------------------------------------------------------------------------------------------------------



|· | Mobile,
    Self-Service and Visualization Technologies: enable end-users with self-service BI, and enable its consumption on mobile
    platforms. We also build next-generation reporting systems using best-in-class visualization technologies.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | Enterprise
    Performance Management: conceptualize and deliver enterprise performance management solutions that help corporations assess
    and analyze their performance around key KPIs, profitability analysis and the like, as well as applications that deliver capabilities
    based on financial consolidation and planning.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | Data
    Mining and Predictive Analytics: design and develop data mining models, and predictive analytics systems.
|- | ------------------------------------------------------------------------------------------------------------------



Engineering
Services



Our
Engineering Services unit provides cutting-edge engineering solutions to support our clients across the product lifecycle of their
offerings, from product ideation and creation to sustenance and end-of-life management. This Practice features deep core and emerging
engineering skills, and strong ecosystem partnerships, along with manufacturing and supply chain expertise that ranges from embedded
firmware to composite material design. Our offerings enable clients to reduce time from concept to market, redesign products for
new demands, and value-engineer for emerging markets. This is augmented by our investments in emerging technologies, which
help clients gain from new business opportunities such as the IoT and Software Defined Networking (SDN).



We have
over twenty years of delivering excellence to Fortune Global 500 clients across multiple industries, utilizing our Global Delivery
Model to design, build, execute and manage complex projects requiring the integration of engineering services with IT and business
process outsourcing (BPO). Our offerings include:



|· | Mechanical
    products and systems, including the design and rendering of automotive, aircraft and industrial subsystems such as lightweight
    composite aero-structures, and design optimization leveraging knowledge-based engineering (KBE)
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | Communications
    engineering, including media services such as interactive TV solutions, large-scale network engineering, and enabling enterprise
    collaboration
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | Electronic
    products and systems, ranging from the new product development (NPD) of home security and automation solutions and wearable
    medical devices, to high-end advanced driver assistance systems (ADAS) connected car solutions
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | Software
    Product Development Services (SPDS) incorporating new technologies that enable clients across multiple industries to further
    differentiate their offerings
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | Product
    Lifecycle Management (PLM), including implementation, systems integration and solution development
|- | --------------------------------------------------------------------------------------------------------------



Cloud
and Infrastructure Services



Our
Cloud and Infrastructure Servicesaims to be the most innovative service provider in the cloud and infrastructure services
space. Our offerings are aimed at helping client organizations simplify and evolve their IT infrastructure for a digital future.



Increasingly,
clients are migrating workloads to a hybrid environment, by benchmarking their internal IT infrastructure services on the basis
of performance, cost, agility and reliability vis-à-vis private and public Cloud infrastructure. Infosys is poised to cater
to this trend through our unique and comprehensive suite of solutions and methodologies based on ‘hybrid IT management’
and ‘workload migration to Cloud’.



At the same time, our industrialized
service delivery and unified hybrid IT management approach deliver a simplified and responsive IT environment using the latest
developments in automation, Cloud, analytics and mobility. With our automation assets, analytics-driven operations, and rapid
environment deployment solutions, we have been able to reduce manual effort, improve asset utilization, and accelerate time-to-market.



Infosys
has also made large investments to create comprehensive platforms and solutions aimed at addressing hybrid IT management and the
industrialization of services. The platforms include:



|· | Infosys
    Hybrid IT Management Platform: It effectively helps enterprises manage and govern a unified hybrid IT environment. The
    solution enables the rapid creation, adoption and governance of Cloud services across the ecosystem. The Unified Services
    Catalog, together with the platform’s smart brokerage capabilities, provides an enterprise-wide, collaborative decision-support
    mechanism to accelerate the assessment and deployment of best-in-class Cloud infrastructure, platforms and applications.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | Infosys
    Automation Suite: Along with Infosys' IT operations analytics solution, this suite reduces manual effort significantly
    through process standardization, predictive analytics and workflow automation
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Infosys Center for Emerging Technology Solutions (iCETS)



iCETS is responsible for incubating new technological capabilities; competencies for emerging technologies,
IP/Accelerators that differentiate service offerings and automation platforms. The mandate for iCETS is to keep an eye on emerging
horizon and help service lines scale the adoption.



iCETS
has developed and deployed platforms for our service lines that include Smart Asset Store, Rapid prototyping Tool for Application
Development, data analysis and migration tools that support DNA Oracle and SAP Practices. Platforms for data privacy, data testing
and functional testing for IVS and IOT platform for Engineering Service. Infosys Enterprise Gamification Platform, recognized
as an industry leading platform, was incubated by iCETS along with location based services and hyper personalized visualization/video.



Our
clients are facing a highly connected, competitive and technology-driven business environment. Predicting the next big threat
or the next big opportunity is becoming increasingly difficult. Our client’s expect us, as their innovation partners, to
help them differentiate themselves with proactive technology guidance and innovation. iCETS brings together the Interdisciplinary
learning by working with multiple segments and clients and contextualization of emerging technologies. iCETS strives to fulfill
these expectations by playing a catalytic role in the technology led innovation and to provide our clients with first mover advantage
in emerging technologies.



3)
Products



EdgeVerve
Systems Limited, a wholly owned subsidiary of Infosys, develops innovative software products and offers them on premise and on
the cloud. Our products help businesses develop deeper connections with stakeholders, power continuous innovation and accelerate
growth in the digital world. We power our clients’ growth in rapidly evolving areas like banking, digital marketing, interactive
commerce, distributive trade, credit servicing, customer service and enterprise buying.

Today
EdgeVerve products and platforms are used by global corporations across industries such as financial services, insurance, retail
and CPG, life sciences, manufacturing  and telecom. Our solutions are available in two broad categories –
Edge suite and FinacleTM



Edge
suite includes – AssistEdge, CreditFinanceEdge, TradeEdge, and ProcureEdge. The solutions focus on realizing business outcomes
for clients by driving revenue growth, cost effectiveness and profitability. AssistEdge is an enterprise class customer service
product that delivers an integrated, cross-channel experience and reduces service intensity by enhancing operational productivity.
CreditFinanceEdge is an integrated credit servicing and asset management platform that manages multiple credit types and asset
classes – from on-boarding to resolution to closure. TradeEdge helps global companies, reach billions of new consumers and
increase revenues while reducing non-productive inventory.  ProcureEdge helps global enterprises realize rapid and sustainable
savings in indirect-spend while providing significant business benefits across the Source-to-Pay (S2P) life cycle.



FinacleTMour universal banking solution suite, is the choice of financial institutions across 92 countries and serves over 839 million
customers. FinacleTM solutions address the core banking, e-banking, mobile banking, CRM, payments, treasury, origination,
liquidity management, Islamic banking, wealth management, and analytics needs of financial institutions. FinacleTM
solutions are consistently rated as a leader in the market by top industry analysts and is proven to be the most scalable banking
platform globally.



4)
Platforms



One
important part of our strategy is the creation of “Infosys Platforms” that consist of Infosys Mana, along with its
three embedded platform components - Infosys Information Platform (IIP), Infosys Automation Platform (IAP) and the Infosys Knowledge
Platform (IKP). Our platforms leverage open source software components, and/or our proprietary software products, all of which
can be deployed in the public or private cloud or on the customers' premises.

Infosys
Mana –Infosys
Mana is our knowledge-based and machine-learning based Artificial Intelligence (AI) offering to enable the re-invention of the
business operations, IT operations and engineering operations in an enterprise. Enterprises constantly have a need to re-imagine
and re-invent their systems landscapes. However, this is currently very hard due to the high cost of making any changes and
the fragmentation of the knowledge about the operations and maintenance of these systems across
multiple people, organizations and systems. This then leads to a significant loss in agility to evolve the business
processes of the enterprise to match the changing customer expectations. Infosys Mana addresses these challenges using
the latest in AI technologies.

IIP- Our
IIP helps enterprises embark on their big data journey by providing a compelling price-performance ratio in data processing
while also enabling them to take advantage of innovations happening in the open source community. IIP is based on an assembly
of tested open source components and offers rapid deployment as a base for a broad variety of industry-specific scenarios. IIP
is the big data component of Infosys Mana, and provides the data ingestion, modeling, NLP and machine learning capabilities.

IAP- Our IAP (Infosys Automation Platform), which was built on top of our IIP, enables improved efficiencies in IT operations.
IAP helps ensures business outcomes by monitoring and analyzing in near real-time, the health of all layers of IT systems including
business processes, applications and infrastructure leveraging stream processing and big data technologies. IAP aim to predict
issues using knowledge models, machine learning algorithms and predictive analytics and aims to prevent business disruptions through
proactive interventions. IAP automates repetitive tasks in IT operations and leverages advanced capabilities like natural language
processing and artificial intelligence to make IT systems self-learning and self-healing. IAP is the automation component of Infosys
Mana.

Panaya

Panaya,
an Infosys company, is a leader in ERP change analytics and cloud-based enterprise software testing. The Panaya CloudQualityTM
Suite disrupts the risk, time and costs required to deliver all types of SAP® and Oracle® EBS changes. Powered by big
data analytics and aggregating since 2008, Panaya CloudQualityTM Suite delivers insights that tell organizations what will
break, how to fix it and what to test. It is constantly improving and finding smarter ways to perform everything from day-to-day
maintenance to major projects.

5)
Skava

Skava,
an Infosys company, powers the next generation of digital transformation for leading retailers worldwide by delivering the most
versatile technology platform in the industry. Skava enables digital shopping experiences for global brands across mobile, tablet,
desktop, in-store, and all emerging channels.



6) Infosys BPO



Infosys BPO offers services to operate,
optimize and transform business processes. Infosys BPO enables clients to outsource several critical business processes that relate
to specific industry verticals and functional horizontals. We operate in the banking, financial services, insurance services, manufacturing,
energy, utilities, communications, media, entertainment, retail, consumer packaged goods, logistics, life sciences and healthcare
verticals.



Our functional horizontals are spread
across the areas of customer service, finance and accounting, human resource outsourcing, legal process outsourcing, sales and
fulfillment operations, sourcing and procurement, and operational analytics. Infosys BPO has not only pioneered ‘Business
Value Realization’ (BVR), but has also emerged as a trusted and valued collaboration partner, through its consistent focus
on improving process and end-business metrics. Through technology solutions and domain competency, Infosys BPO is focused on the
automation of processes to make them touch-less, realize business value, and co-create to sustain long-term partnerships.



OUR CLIENTS



We market our services to large enterprises
throughout the globe. We have a strong market presence in North America, Europe and Asia Pacific. We are also currently building
a strong presence in South America and Africa.



Our revenues for the last three fiscal
years by geographic area are as follows:



|                  | Fiscal
|----------------- | ------
|                  | 2016  
|North America     | 62.7% 
|Europe            | 23.0% 
|India             | 2.6%  
|Rest of the World | 11.7% 
|Total             | 100.0%



Our revenues for the last three fiscal
years by business segment were as follows:



|Business Segments                                    | Fiscal
|---------------------------------------------------- | ------
|                                                     | 2016  
|Financial services (FS)                              | 27.3% 
|Manufacturing (MFG)                                  | 11.0% 
|Energy & utilities, Communication and Services (ECS) | 21.7% 
|Retail, Consumer packaged goods and Logistics (RCL)  | 16.4% 
|Life Sciences, Healthcare and Insurance (HILIFE)     | 13.0% 
|Hi-Tech                                              | 7.9%  
|All other Segments                                   | 2.7%  
|Total                                                | 100.0%



For fiscal 2016, 2015 and 2014 our largest
client contributed 3.6%, 3.3% and 3.8%, respectively, of our total revenues.



The volume of work we perform for specific
clients varies from year to year based on the nature of the assignments we have with our clients. Thus, a major client in one year
may not provide the same level of revenues in a subsequent year. However, in any given year, a limited number of clients tend to
contribute a significant portion of our revenues. Our revenues experience seasonality across certain quarters based on the billable
effort that varies across quarters due to differences in the number of working days for our clients and variation in the amount
of client spending across quarters.



SALES AND MARKETING OVERVIEW



We have organized our sales, marketing
and business development departments into teams that focus on specific geographies and industries, enabling us to better customize
our service offerings to our clients’ needs. Our sales and marketing strategy is focused on articulating and demonstrating
that higher productivity and optimal contribution of each individual can be achieved due to both innovation and experienced professionals
whose talents, are amplified by the knowledge, imagination, conviction,community and the ecosystem
they bring with them.



Infosys branding is designed to position
Infosys as the next-generation services company that will help enterprises renew themselves and create new avenues from which
to generate value. The Infosys brand is built around the premise that software, in a very fundamental way, is reshaping the
world around us. Because of this, there is a duality that every business faces; - on the one hand, the need to renew existing systems
and improve their effectiveness with new technologies and innovation, and on the other hand, deliver completely new kinds of services,
new solutions in new ways using next-generation technologies.



Our sales organization is aligned by industry
segments and we have sales and marketing offices in 43 countries around the world including India. Our blend of geographic reach
and industry expertise allow us to deliver global expertise locally and tailored to each of our client's needs.



COMPETITION



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



We typically compete with other technology
services providers in response to requests for proposals. Clients often cite our industry expertise, comprehensive end-to-end solutions,
ability to scale, superior quality and process execution, 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 strengthen their offshore presence in India or other
low-cost locations, firms that offer technology based solutions to business problems and from firms incumbent in market segments
that we have recently entered.

We believe that the principal competitive
factors in our business are:



|· | the ability to keep pace with ever-changing
technology and customer requirements;
|- | ---------------------------------------------------------------------------------

|· | the ability to increase the scale and breadth
of service offerings to provide one-stop solutions for customer needs;
|- | --------------------------------------------------------------------------------------------------------------------

|· | the ability to articulate and demonstrate
long-term value to existing and potential customers;
|- | ----------------------------------------------------------------------------------------------

|· | the ability to attract and retain high-quality
management, technology professionals, and sales personnel;
|- | ---------------------------------------------------------------------------------------------------------

|· | the ability to effectively integrate onsite
and offshore execution capabilities to deliver high quality, seamless, scalable, cost-effective services
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------

|· | a strong and well-recognized brand;
|- | -----------------------------------

|· | a proven track record of performance excellence
and customer satisfaction;
|- | --------------------------------------------------------------------------

|· | the financial strength to be able to invest
in personnel and infrastructure to support the evolving demands of customers; and
|- | -----------------------------------------------------------------------------------------------------------------------------

|· | high ethical and corporate governance standards
to ensure honest and professional business practices and protect the reputation of the company and its customers.
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------



HUMAN CAPITAL



Our professionals are our most important
assets. We believe that the quality and level of service that our professionals deliver are among the highest in the global technology
services industry. We are committed to remaining among the industry’s leading employers.



As of March 31, 2016, we employed 194,044
employees, of which 182,329 are software professionals, including trainees. During fiscal 2016, we added 17,857 new hires, net
of attrition. Our culture and reputation as a leader in the technology services industry enables us to recruit and retain some
of the best available talent in India.



We have built our global talent pool
by recruiting new students from premier universities, colleges and institutes in India and through need-based hiring of project
leaders and middle managers across the globe. We recruit students who have consistently shown high levels of achievement from campuses
in India.  We, generally, also recruit students from campuses including the United States, the United Kingdom, Australia and China.
We rely on a rigorous selection process involving aptitude tests and interviews to identify the best applicants. This selection
process is continually assessed and refined based on the performance tracking of past recruits.



During fiscal 2016, we received 1,115,745
employment applications, interviewed 121,670 applicants and extended offers of employment to 55,056 applicants. These statistics
do not include our subsidiaries.



A large part of our focus in fiscal 2015 was on listening to employee feedback to make the right changes.
Zero Distance, a movement to bring innovation to every project at Infosys, facilitated by a 5 point framework of innovation was
an example of employee engagement built through ground-up involvement in organizational growth and strategy. Through the year,
we gathered feedback from employees across all our communication channels and platforms, including our annual employee engagement
survey (LITMUS 2016). From LITMUS, we identified a number of tracks to be actionized, and invited employees to be a part of these.
We also worked on an exercise to identify influencer groups within the organization, whose networks could be leveraged to spread
ideas of innovation and collaboration. To ensure that employees are able to be their productive best, we worked on simplifying
internal processes through a collaborative effort with various teams. Rewards and recognition in terms of the annual awards for
excellence, quarterly promotions, and unit awards continued.



Education, Training and Assessment



Competency
development continues to be a key area of strategic focus for us. We launched new programs for our employees in keeping with the
changes in the use of technology in education. We enhanced our technology led training efforts in multiple areas. With over 1,405
videos on various topics and many multimedia artifacts for learning, we now have a rich repository of technology assisted learning.



During
fiscal 2016, the total training provided for employees was over 2.12 million person days. Many of our employees also took external
certifications creating a large pool of certified people.





We
conduct Design Thinking programs to enhance the innovation quotient of our employees. The number of total participants who benefited
from the Design Thinking training crossed over 80,000 as of March 31, 2016.

Our
industry-academia partnership program, Campus Connect, made progress through the launch of electives to help engineering colleges
run new programs within their curricula. During fiscal 2016, we engaged with 1,225 faculty members who in turn trained 40,996
students. With this, the total number of beneficiaries covered has reached 13,111 faculty members and 371,639 students from 317
engineering institutions. Our knowledge management system set a new record by winning the Global Most Admired Knowledge Enterprise
(MAKE) award for the 11th time, Asian MAKE Award for the 13th time and the Indian MAKE award for the 11thtime.



Compensation



Our
technology professionals receive competitive salaries and benefits. We have a performance-linked compensation program that links
compensation to individual performance, as well as our company performance.



INTELLECTUAL PROPERTY



Our intellectual property rights are
critical to our business. We rely on a combination of patent, copyright, trademark and design laws, trade secrets, confidentiality
procedures and contractual provisions to protect our intellectual property. We currently have 292 patents issued by the United
States Patent and Trademark Office, 1 patent issued by Australian Patent Office, 6 patents issued by Intellectual Property Office
of Singapore and 3 patents issued by the Luxembourg Patent Office and an aggregate of 424 pending patent applications. We also
have 37 trademarks registered across classes identified for various goods and services in India and in other countries. We require
employees, independent contractors and whenever possible, vendors to enter into confidentiality agreements upon the commencement
of their relationships with us. These agreements generally provide that any confidential or proprietary information developed by
us or on our behalf be kept confidential. These agreements also provide that any confidential or proprietary information disclosed
to third parties in the course of our business be kept confidential by such third parties. However, our clients usually own the
intellectual property in the software we develop for them.



We regard our trade name, trademarks,
service marks and domain names as important to our success. We rely on the law to protect our proprietary rights to them, and we
have taken steps to enhance our rights by filing trademark applications where appropriate. We have obtained registration of our
key brand ‘INFOSYS’ as a trademark in both India and in the United States. We also aggressively protect these names
and marks from infringement by others.



EFFECT OF GOVERNMENT REGULATION ON
OUR BUSINESS



Regulation of our business by the Indian
government affects us in several ways. We have benefited from certain tax incentives promulgated by the Government of India, including
tax holiday from Indian corporate income tax on the income from the operation of the units registered under the Software Technology
Parks Scheme and tax holidays on the income from the operation of our units registered under the Special Economic Zone Act. The
tax holiday for all of our STP units expired as of March 31, 2011. We have also benefited from the liberalization and deregulation
of the Indian economy by the successive Indian governments since 1991. Further, there are restrictive Indian laws and regulations
that affect our business, including regulations that require us to obtain approval from the RBI and / or the Ministry of Finance
of the Government of India in certain cases, to acquire companies incorporated outside India and regulations that require us, subject
to some exceptions, to obtain approval from relevant government authorities in India in order to raise capital outside India. The
conversion of our equity shares into ADSs is governed by guidelines issued by the RBI. The Indian Companies Act, 2013 has introduced
the concept of compulsory corporate social responsibilities. As per the Indian Companies Act, 2013, all companies having net worth
of rupees five hundred crore or more, turnover of rupees one thousand crore or more or a net profit of rupees five crore or more
during any financial year will be required to constitute a Corporate Social Responsibility (CSR) Committee of the board of directors
consisting of three or more directors, at least one of whom will be an independent director, and have a CSR policy approved by
the Board. Consequent to the requirements of the Indian Companies Act, 2013, $33 million was contributed towards corporate social
responsibility activities during fiscal 2016.



The ability of our technology professionals
to work in the United States, Europe and in other countries depends on the ability to obtain the necessary visas and work permits.
As of March 31, 2016, the majority of our professionals in the United States held either H-1B visas (14,659 persons), which allow
the employee to remain in the United States for up to six years during the term of the work permit and work as long as he or she
remains an employee of the sponsoring firm, or L-1 visas (1,364 persons), which allow the employee to stay in the United States
only temporarily. If employees are on L-1A visas, they can typically stay in the United States temporarily for a maximum duration
of 7 years and if they are on L-1B visas they can stay in the United States temporarily for a maximum duration of 5 years. Both
are temporary visas, but the company may sponsor employees on either visa for green cards.



U.S. law provides that the annual limit
on H-1B visas is 65,000 plus 20,000 additional H-1B visas that are available to those who possess a master's or higher degree from
institutions of higher education in the United States. For fiscal 2017, over 236,000 applications were received during the filing
period which began on April 1, 2016. The government conducts a random lottery to determine which H-1B applications will be adjudicated
that year. Increasing demand for H-1B visas, or changes in how the annual limit is administered, could limit the company’s
ability to access that visa classification.



Changesin L-1 visa policy, either by statute or through administrative policy, could limit our ability to transfer existing employees
to the United States.



Immigration laws in the United States
may also require us to meet certain levels of compensation, and to comply with other legal requirements, including labor market
tests, as a condition to obtaining or maintaining work visas for our technology professionals working in the United States.



Immigration laws in the United States
and in other countries are subject to legislative and policy changes, as well as to variations in standards of application and
enforcement due to political forces and economic conditions. In addition, the U.S. Congress is considering extensive changes to
U.S. immigration laws regarding the admission of high-skilled temporary and permanent workers. This could have a material and adverse
effect on our business, revenues and operating results.



Similar labor market protective immigration
reform measures have been introduced in many countries, which include minimum wage floor requirements for certain work permit categories.
Many governments have also tightened adjudication standards for labor market tests. These changes could negatively affect our ability
to utilize current employees to fulfil existing or new projects and could also result in higher operating expenses.



It is difficult to predict the political
and economic events that could affect immigration laws, or the restrictive impact they could have on obtaining or monitoring work
visas for our technology professionals. Our reliance on work visas for a significant number of technology professionals makes us
particularly vulnerable to such changes and variations as it affects our ability to staff projects with technology professionals
who are not citizens of the country where the work is to be performed. Recently, there has been an increase in the number of visa
application rejections. This may affect our ability to get timely visas and staff projects accordingly. As a result, we may not
be able to obtain a sufficient number of visas for our technology professionals or may encounter delays or additional costs in
obtaining or maintaining the conditions of such visas. Additionally, we may have to apply in advance for visas and this could result
in additional expenses during certain quarters of the fiscal year.



LEGAL PROCEEDINGS



The company is subject to legal proceedings
and claims, which have arisen in the ordinary course of business. The company’s management does not reasonably expect that
these legal actions, when ultimately concluded and determined, will have a material and adverse effect on the company’s results
of operations or financial condition.



|C. | ORGANIZATIONAL STRUCTURE
|-- | ------------------------



We hold a majority interest in the following
companies:



Infosys BPO. Infosys established
Infosys BPO Limited in April 2002, under the laws of India. As of March 31, 2016, Infosys holds 99.98% of the outstanding equity
shares of Infosys BPO.



Infosys is the sole shareholder of the
following companies:



Infosys Australia. In January
2004, we acquired, for cash, 100% of the equity in Expert Information Services Pty. Limited, Australia. The acquired company was
renamed as 'Infosys Technologies (Australia) Pty. Limited'. As of March 31, 2016, Infosys Australia is under liquidation.



Infosys China. In October
2003, we established a wholly-owned subsidiary, Infosys Technologies (China) Co. Limited (Infosys China) in Shanghai, China, to
expand our business operations in China.



Infosys Mexico.In June
2007, we established a wholly-owned subsidiary, Infosys Technologies S.de R.L.de C. V. (Infosys Mexico) to expand our business
operations in Latin America.



Infosys Sweden.In March
2009, we incorporated a wholly-owned subsidiary, Infosys Technologies (Sweden) AB to expand our operations in Sweden.



Infosys Brasil.In August
2009, we incorporated a wholly-owned subsidiary, Infosys Tecnologia do Brasil Ltda to expand our operations in South America.



Infosys Public Services.In
October 2009, we incorporated a wholly-owned subsidiary, Infosys Public Services Inc., to focus and expand our operations in the
U.S. public services market.



Infosys Shanghai.In February
2011, we incorporated a wholly-owned subsidiary, Infosys Technologies (Shanghai) Company Limited, in China.



Infosys Consulting India Limited.
Infosys Consulting India Limited (ICIL) was a wholly owned subsidiary of Infosys Consulting Inc. until the termination of Infosys
Consulting Inc., effective January 12, 2012. Pursuant to the transfer of assets and liabilities of Infosys Consulting Inc. to Infosys
Limited, Infosys Consulting India Limited became a wholly owned subsidiary of Infosys Limited. On February 9, 2012, ICIL filed
a petition in the Honourable High Court of Karnataka for its merger with Infosys Limited. The Hon’ble High Court of Karnataka
sanctioned the scheme of amalgamation of ICIL with Infosys Limited with an effective date of August 23, 2013 and an appointed date
of January 12, 2012. Accordingly, all the assets and liabilities of ICIL were transferred to Infosys Limited on a going concern
basis. As ICIL was a wholly owned subsidiary of Infosys Limited, no shares have been allotted to the shareholders upon the scheme
becoming effective.



Infosys Lodestone.In October
2012, Infosys acquired 100% of the voting interests in Infosys Consulting Holding AG (formerly Lodestone Holding AG), a global
management consultancy firm headquartered in Zurich, Switzerland.



Infosys Americas.In June
2013, we incorporated a wholly-owned subsidiary, Infosys Americas Inc.



EdgeVerve.In February
2014, we incorporated a wholly owned subsidiary EdgeVerve Systems Limited to focus on developing and selling products and platforms.



Infosys Nova.In January
2015, we incorporated a wholly owned subsidiary Infosys Nova Holding LLC. During the year ended March 31, 2015, Infosys Nova acquired
20% of the equity interests in DWA Nova LLC for a cash consideration of $15 million. The Company has made this investment to form
a new company along with Dream Works Animation (DWA). As of March 31, 2016, Infosys Nova holds 16% of the equity interests in DWA
Nova LLC.



Panaya.In March 2015, we
acquired 100% of the voting interests in Panaya Inc. (Panaya), a Delaware Corporation in the United States. Panaya is a leading
provider of automation technology for large scale enterprise and software management.



Kallidus.In June 2015,
Infosys acquired 100% of the voting interests in Kallidus Inc., US (Kallidus), a leading provider of digital experience solutions,
including mobile commerce and in-store shopping experiences to large retail clients and 100% of the voting interests of Skava Systems
Private Limited, an affiliate of Kallidus.



Noah.In November 2015, Infosys has acquired 100% membership interest in Noah Consulting, LLC (Noah), a leading
provider of advanced information management consulting services for the oil and gas industry.



See Note 2.18, Related Party transactions
under Item 18 of this Annual Report on Form 20-F for a list of all our subsidiaries and associates.



|D. | PROPERTY, PLANT AND EQUIPMENT
|-- | -----------------------------



The campus of our corporate headquarters, Infosys City, is located at Electronics City, Bangalore, India. Infosys City consists of approximately 4.6 million square feet
of land and 4.4 million square feet of operational facilities. The campus features, among other things, an Education, Training
and Assessment unit, a Management Development Center and extensive state-of-the-art conference facilities.



Additionally, we have leased independent
facilities measuring approximately 949,000 square feet in Electronics City which accommodate approximately 10,000 employees.



Our capital expenditure on property,
plant and equipment for fiscal 2016, 2015, and 2014 was $413 million, $367 million, and $451 million, respectively. As of March
31, 2016 we had contractual commitments for capital expenditure of $224 million. All our capital expenditures are financed out
of cash generated from operations.



Our software development facilities are
equipped with a world-class technology infrastructure that includes networked workstations, servers, data communication links and
video-conferencing.



We have 85 sales and marketing offices
across the world. Appropriate expansion plans are being undertaken to meet our expected future growth.



Our most significant leased and owned
properties are listed in the table below.



|Location                                                                   | Building        | Seating capacity | Ownership | Land            | Ownership
|-------------------------------------------------------------------------- | --------------- | ---------------- | --------- | --------------- | ---------
|                                                                           | Approx. Sq. ft. |                  |           | Approx. Sq. ft. |          
|Software Development Facilities                                            |                 |                  |           |                 |          
|Bangalore (Infosys City), Karnataka                                        | –               | –                | –         | 23,958          | Leased   
|Bangalore - J.P.Nagar Sarakki, Karnataka                                   | –               | –                | –         | 16,553          | Owned    
|Bangalore (Infosys City Main Campus), Karnataka                            | 3,782,492       | 22,578           | Owned     | 3,505,446       | Owned    
|Bangalore (Infosys City-Phase 2), Karnataka                                | –               | –                | –         | 152,896         | Owned    
|Bangalore SY No 66 (Electronics City Karnataka)                            | –               | –                | –         | 44,083          | Owned    
|Bangalore Plot no 44 (SY No 5,11 15(p) - (Electronics City Karnataka)      | –               | –                | –         | 217,801         | Owned    
|Bangalore Plot
    no 20 (SY No 43(p) Electronic City-Phase 2              | –               | –                | –         | 43,647          | Owned    
|Bangalore (Center Point, Electronics City), Karnataka                      | 158,100         | 1,175            | Leased    | –               | –        
|Bangalore Sarjapur & Billapur, Karnataka                                   | –               | –                | –         | 14,272,751      | Owned    
|Bangalore (Devanahalli), Karnataka                                         | –               | –                | –         | 374,313         | Owned    
|Bangalore (Salarpuria Building, Electronics City) Karnataka                | 225,245         | 3,264            | Leased    | –               | –        
|Bangalore (Tower Office, Banerghatta Road), Karnataka                      | 120,906         | 1,408            | Leased    | –               | –        
|Bangalore (JP IT Park Building, Electronics City), Karnataka               | 170,724         | 1,654            | Leased    | –               | –        
|Bangalore - Building next to Gate 2 (Opp. Siemens), Karnataka              | 399,080         | 2,081            | Owned     | 90,170          | Owned    
|Bangalore - EC 53 Building (Electronics City Karnataka)                    | 220,334         | 2,089            | Owned     | 131,552         | Owned    
|Bangalore - Opp to EC 53 Building (Electronics City Karnataka)             | –               | –                | –         | 437,344         | Owned    
|Bangalore – Goldhill building on rent Phase-2 (Electronics City Karnataka) | 394,500         | 3,930            | Leased    | –               | –        
|Bhubaneswar (Chandaka Industrial Park), Orissa                             | 879,721         | 3,974            | Owned     | 1,999,455       | Leased   
|Bhubaneswar (Info Valley Goudakasipur & Arisol), Orissa                    | 325,689         | 2,194            | Owned     | 2,218,040       | Leased   
|Chandigarh (SEZ Campus)                                                    | 1,135,580       | 6,079            | Owned     | 1,316,388       | Leased   
|Chennai
(Sholinganallur), Tamil Nadu                                       | 508,300         | 3,490            | Owned     | 578,043         | Leased   
|Chennai (Maraimalai Nagar), Tamil Nadu                                     | 3,637,108       | 20,168           | Owned     | 5,617,084       | Leased   
|Chennai Kothari Rd Nungambakkam Tamil Nadu                                 | –               | –                | –         | 16,610          | Owned    
|Chennai - BPO Offices                                                      | 131,128         | 1,612            | Leased    | –               | –        
|Hyderabad (Manikonda Village), Andhra Pradesh                              | 1,873,209       | 10,266           | Owned     | 2,194,997       | Owned    
|Hyderabad (Pocharam Village), Andhra Pradesh                               | 3,051,680       | 15,719           | Owned     | 19,615,145      | Owned    
|Mangalore (Kottara), Karnataka                                             | 204,000         | 1,268            | Owned     | 119,790         | Owned    
|Mangalore (Pajeeru and Kairangala Village), Karnataka                      | 1,741,636       | 5,604            | Owned     | 15,156,794      | Leased   
|Mangalore (Kairangala Village), Karnataka                                  | –               | –                | –         | 258,747         | Owned    
|Mysore (Hebbal Electronic City), Karnataka                                 | 11,564,877      | 15,576           | Owned     | 12,652,487      | Owned    
|Mysore (Hebbal Electronic City), Karnataka                                 | –               | –                | –         | 2,047,346       | Leased   
|Mysore – Hebbal Village Karnataka                                          | –               | –                | –         | 10,803          | Owned    
|Mysore – Hebbal Village Karnataka                                          | –               | –                | –         | 460,083         | Owned    
|Pune (Hinjewadi), Maharashtra                                              | 589,647         | 3,771            | Owned     | 1,089,004       | Leased   
|Pune (Hinjewadi Phase II), Maharashtra                                     | 6,123,575       | 33,084           | Owned     | 4,987,787       | Leased   
|Thiruvananthapuram, Attipura Village, Kerala                               | 1,989,655       | 7,070            | Owned     | 2,178,009       | Leased   
|Thiruvananthapuram, Pallipuram Village, Kerala                             | –               | –                | –         | 2,171,039       | Leased   
|Jaipur (M-City), Rajasthan                                                 | 778,245         | 6,908            | Owned     | –               | –        
|Jaipur (Mahindra World City), Rajasthan                                    | –               | –                | –         | 6,452,568       | Leased   
|Nagpur - Dahegaon Village (SEZ campus)                                     | –               | –                | –         | 6,193,211       | Leased   
|Indore - Tikgarita Badshah & Badangarda Village (SEZ campus)               | –               | –                | –         | 5,666,307       | Leased   
|Hubli - Gokul Village (SEZ campus)                                         | –               | –                | –         | 1,875,265       | Leased   
|Noida - Plot No A-1 to A-6 Sector 85                                       | –               | –                | –         | 1,201,346       | Leased   
|Mohali Plot No I-3 Sector 83 A IT City SAS Nagar                           | –               | –                | –         | 2,178,009       | Leased   
|New Delhi Vasanth Vihar                                                    | –               | –                | –         | 9,360           | Owned    
|Shanghai Infosys Technologies (Shanghai) Co. Ltd(1)(2)                     | –               | –                | –         | 657,403         | Leased   
|Shanghai, China                                                            | 254,278         | 2,021            | Leased    | –               | –        
|Hangzhou, China                                                            | 186,814         | 2,149            | Leased    | –               | –        
|Manila, Philippines                                                        | 149,974         | 2,365            | Leased    | –               | –        
|Lodz, Poland                                                               | 224,643         | 2,597            | Leased    | –               | –        



|(1) |  | The nature of the ownership
is that of a land use right.
|--- |  | --------------------------------------------------------



|(2) |  | We
                                         are in the process of establishing a new software development facility center in China.
                                         The facility center will have an area of approximately 1,050,000 square feet with
                                         a seating capacity of around 4,500 to focus on Chinese and global markets. The project
                                         would require an estimated cost of approximately $170 million. We expect to complete
                                         the construction of this software development center in the fiscal year ending March
                                         31, 2017.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Item
4 A. Unresolved Staff Comments



None.



Item 5. Operating and Financial Review
and Prospects



The consolidated financial statements
of the Company included in this Annual Report on Form 20-F have been prepared in accordance with International Financial Reporting
Standards as issued by International Accounting Standards Board. The discussion, analysis and information presented in this section
should be read in conjunction with our consolidated financial statements included herein and the notes thereto.



OPERATING RESULTS



This information is set forth under the
caption entitled 'Management's Discussion and Analysis of Financial Condition and Results of Operations' below and is incorporated
herein by reference.



LIQUIDITY AND CAPITAL RESOURCES



This information is set forth under the
caption entitled 'Management's Discussion and Analysis of Financial Condition and Results of Operations' below and is incorporated
herein by reference.



RESEARCH AND DEVELOPMENT, PATENTS
AND LICENSES, ETC.



We have committed and expect to continue
to commit in the future, a portion of our resources to research and development. Efforts towards research and development are focused
on refinement of methodologies, tools and techniques, implementation of metrics, improvement in estimation process and the adoption
of new technologies.



Our research and development expenses
for fiscal 2016, 2015 and 2014 were $108 million, $110 million and $147 million, respectively.



TREND INFORMATION



This information is set forth under the
caption entitled “Management's Discussion and Analysis of Financial Condition and Results of Operations” below and
is incorporated herein by reference.



MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS



Overview



Infosys is a leading provider of consulting, technology, outsourcing solutions and next-generation services.



Our professionals deliver high quality
solutions through our Global Delivery Model. Using our Global Delivery Model, we divide projects into components that we execute
simultaneously at client sites and at our Development Centers in India and around the world. We optimize our cost structure by
maintaining the flexibility to execute project components where it is most cost effective. Our Global Delivery Model, with its
scalable infrastructure and ability to execute project components around the clock and across time zones, also enables us to reduce
project delivery times.



We have organized our sales and marketing
departments into teams that focus on specific geographies and industries, enabling us to better customize our service offerings
to our clients’ needs. Our primary geographic markets are North America, Europe, India and Rest of the World. We serve clients
in financial services; manufacturing; energy, communications, utilities and services; retail, consumer packaged goods and logistics;
life sciences, healthcare, insurance and Hi-Tech.



There is an increasing need for highly
skilled technology professionals in the markets in which we operate and in the industries to which we provide services. At the
same time, companies are reluctant to expand their internal IT departments and increase costs. These factors have increased the
reliance of companies on their outsourcing service providers and are expected to continue to drive future growth for outsourcing
services. We believe that because the effective use of offshore technology services offers lower total costs of ownership of IT
infrastructure, lower labor costs, improved quality and innovation and faster delivery of technology solutions, companies are increasingly
turning to offshore technology service providers. The key factors contributing to the growth of IT and IT enabled services in India
include high quality delivery, significant cost benefits and the availability of a large and growing skilled and English speaking
IT professionals. Our proven Global Delivery Model, our comprehensive end-to-end solutions, our commitment to superior quality
and process execution, our long standing client relationships, our ability to service clients across industries and our ability
to scale make us one of the leading offshore service providers in India.



There are numerous risks and challenges
affecting the business. These risks and challenges are discussed in detail in the section entitled 'Risk Factors' and elsewhere
in this Annual Report on Form 20-F.



We were founded in 1981 and are headquartered
in Bangalore, India. We completed our initial public offering of equity shares in India in 1993 and our initial public offering
of ADSs in the United States in 1999. We completed three sponsored secondary ADS offerings in the United States in August 2003,
June 2005 and November 2006. We did not receive any of the proceeds from any of our sponsored secondary offerings.



The Hon’ble High Court of Karnataka
sanctioned the scheme of amalgamation of Infosys Consulting India Limited (ICIL) with Infosys Limited with an effective date of
August 23, 2013. Accordingly, during fiscal 2014, all the assets and liabilities of ICIL were transferred to Infosys Limited on
a going concern basis. As ICIL was a wholly owned subsidiary of Infosys Limited, no shares have been allotted to the shareholders
upon the scheme becoming effective.



We incorporated a wholly owned subsidiary,
Infosys Americas Inc., on June 25, 2013.



EdgeVerve was created as a wholly
owned subsidiary on February 14, 2014 to focus on developing and selling products and platforms. On April 15, 2014, the Board
authorized the Company to execute a Business Transfer Agreement and related documents with EdgeVerve, subject to securing the
requisite approval from shareholders in the Annual General Meeting. Subsequently, at the AGM held on June 14, 2014, the
shareholders have authorized the Board to enter into a Business Transfer Agreement and related documents with EdgeVerve, with
effect from July 1, 2014 or such other date as may be decided by the Board. We have undertaken an enterprise valuation by an
independent valuer and accordingly the business has been transferred to the Company’s wholly owned subsidiary for a
consideration of $70 million (421 crore) with effect from July 1, 2014 which is settled through the issue of fully paid-up equity
shares of such subsidiary. The transfer of assets and liabilities between entities under common control is accounted for at
carrying values and does not have any impact on the consolidated financial statements.



Further, on April 24, 2015, the Board
authorized the Company to execute a Business Transfer Agreement and related documents with EdgeVerve, to transfer the business
of Finacle and EdgeServices. After the requisite approval from the shareholders through postal ballot on June 4, 2015, a Business
Transfer Agreement and other related documents were executed with EdgeVerve to transfer the business with effect from August 1,
2015. We have undertaken an enterprise valuation by an independent valuer and accordingly the business were transferred for a consideration
of approximately $491 million and approximately $27 million for Finacle and EdgeServices, respectively. The consideration was settled
through issue of 850,000,000 equity shares amounting to approximately $129 million and 254,900,000 non-convertible redeemable debentures
amounting to approximately $389 million in EdgeVerve, post the requisite approval from shareholders on December 11, 2015. The transfer
of assets and liabilities between entities under common control was accounted for at carrying values and did not have an impact
on the consolidated financial statements.



On January 23,2015, a wholly
owned subsidiary, Infosys Nova Holdings LLC, was incorporated. During fiscal 2015, the Company acquired 20% of the equity interests
in DWA Nova LLC for a cash consideration of $15 million. The Company has made this investment to form a new company along with
Dream Works Animation (DWA). The new company, DWA Nova LLC, will develop and commercialize image generation technology in order
to provide end-to-end digital manufacturing capabilities for companies involved in the design, manufacturing, marketing or distribution
of physical consumer products. As of March 31, 2016, Infosys Nova holds 16% of the equity interest in DWA Nova LLC.



On March 5, 2015, Infosys acquired 100%
of the voting interests in Panaya Inc. (Panaya), a Delaware Corporation in the United States. Panaya is a leading provider of automation
technology for large scale enterprise and software management. The business acquisition was conducted by entering into a share
purchase agreement for cash consideration of $225 million. Panaya’s CloudQualityTM suite positions Infosys to bring
automation to several of its service lines via an agile SaaS model, and helps mitigate risk, reduce costs and shorten time to market
for clients.



On June 2, 2015,
Infosys acquired 100% of the voting interests in Kallidus Inc., U.S (Kallidus), a leading provider of digital experience
solutions, including mobile commerce and in-store shopping experiences to large retail clients and 100% of the voting
interests of Skava Systems Private Limited, India, an affiliate of Kallidus. Infosys expects to help its clients bring new
digital experience to their customers through IP-led technology offerings, new automation tools and skill and expertise in
these new emerging areas. The business acquisition was conducted by entering into a share purchase agreement for cash
consideration of $91 million and a contingent consideration of up to $20 million. The payment of the contingent consideration
to sellers of Kallidus is dependent upon the achievement of certain financial targets by Kallidus over a period of 3 years
ending on December 31, 2017.



On November 16, 2015, Infosys
acquired 100% membership interest in Noah Consulting, LLC, (Noah), a leading provider of advanced information management
consulting services for oil and gas industry. The acquisition combines Noah’s industry knowledge, information strategy
planning, data governance and architecture capabilities with Infosys’ ability to provide technology and outsourcing
services on a global scale to oil and gas clients. The business acquisition was conducted by entering into a share purchase
agreement for a cash consideration of $33 million, a contingent consideration of up to $5 million and an additional
consideration of up to $32 million, referred to as retention bonus payable to the employees of Noah at each anniversary year
following the acquisition date for the next three years, subject to their continuous employment with the group at each
anniversary. The payment of the contingent consideration to the sellers of Noah was dependent upon the achievement of certain
financial targets by Noah for the year ended December 31, 2015 and year ending December 31, 2016. During fiscal 2016, based
on an assessment of Noah achieving the targets for the year ended December 31, 2015 and year ending December 31, 2016, the
entire contingent consideration has been reversed in the statement of comprehensive income.



We
allotted 574,236,166 fully paid up equity shares of face value 5/- each during the three
months ended December 31, 2014 pursuant to a bonus issue approved by the shareholders through postal ballot. The record date
fixed by our Board was December 3, 2014. A bonus share of one equity share for every equity share held, and a stock dividend
of one American Depositary Share (ADS) for every ADS held, respectively, has been allotted. Consequently, the ratio of equity
shares underlying the ADSs held by an American Depositary Receipt holder remains unchanged. Options granted under the
stock option plan have been adjusted for bonus shares.



We have allotted 1,148,472,332
fully paid-up equity shares of face value 5/- each during the three months ended June 30, 2015 pursuant to a bonus issue approved
by our shareholders through postal ballot. We allotted bonus share of one equity share for every equity share held, and a stock
dividend of one American Depositary Share (ADS) for every ADS held, respectively, to holders of our securities as of the record
date of June 17, 2015. Consequently, the ratio of equity shares underlying the ADSs held by an American Depositary Receipt holder
remains unchanged. Options granted under the stock option plan have been adjusted for bonus shares.



11,323,576 and 5,667,200 shares
were held by controlled trust, as of March 31, 2016 and March 31, 2015, respectively.



Effective fiscal 2014, the board decided
to increase the dividend pay-out ratio of the company from up to 30% of post-tax consolidated profits to up to 40% of post-tax
consolidated profits. In its meeting on April 24, 2015, the Board decided to increase dividend pay-out ratio from up to 40% to
up to 50% of post-tax consolidated profits effective fiscal 2015.



At our Annual General Meeting held on
June 22, 2015, our shareholders approved a final dividend of 29.50 per equity share (approximately $0.47 per equity share) (not
adjusted for the June 17, 2015 bonus issue) which in the aggregate resulted in a cash outflow of $636 million (excluding dividend
paid on treasury shares), including of corporate dividend tax.



On October 12, 2015, our Board declared
an interim dividend of 10.00 ($0.15 per equity share) which resulted in a cash outflow of $423 million, (excluding dividend paid
on treasury shares) inclusive of corporate dividend tax.



Our Board, in its meeting on April 15,
2016, proposed a final dividend of 14.25 per equity share (approximately $0.22 per equity share). The proposal is subject to the
approval of shareholders at the ensuing Annual General Meeting to be held on June 18, 2016, and if approved, would result in a
cash outflow of approximately $592 million (excluding dividend paid on treasury shares), including corporate dividend tax.



On March 31, 2016, pursuant to the approval
by the shareholders through postal ballot the Board has been authorised to introduce, offer, issue and allot share-based
incentives to eligible employees of the Company and its subsidiaries under the 2015 Stock incentive compensation plan (the 2015
Plan). The maximum number of shares under the 2015 plan shall not exceed 24,038,883 equity shares. 17,038,883 equity shares will
be issued as RSUs at par value and 7,000,000 equity shares will be issued as stock options at market price. These instruments will
vest over a period of 4 years and the Company expects to grant the instruments under the 2015 Plan over the period of 4 to 7 years.
For additional information of the Company’s stock incentive compensation plans, see Note 2.15 Employees’ Stock
Options Plans under Item 18 of this Annual Report.



The following table illustrates our compounded
annual growth rate in revenues, net profit, earnings per equity share and number of employees from fiscal
2012 to fiscal 2016:



(Dollars in millions
except per share and employee data)

|                                                  | Fiscal 2016 | Fiscal 2012 | Compounded annualgrowth rate
|------------------------------------------------- | ----------- | ----------- | ----------------------------
|Revenues                                          | 9,501       | 6,994       | 8.0%                        
|Net profit                                        | 2,052       | 1,716       | 4.6%                        
|Earnings per equity share (Basic)*                | 0.90        | 0.75        | 4.6%                        
|Earnings per equity share (Diluted)*              | 0.90        | 0.75        | 4.6%                        
|Number of employees at the end of the fiscal year | 194,044     | 149,994     | 6.6%                        



* Adjusted for bonus
shares



Our revenue growth was attributable to
a number of factors, including an increase in the volume and number of projects executed for clients, as well as an expansion in
the solutions that we provide to our clients. We added 325 new customers (gross) during fiscal 2016 as compared to 221 new customers
(gross) during fiscal 2015 and 238 new customers (gross) during fiscal 2014. For fiscal 2016, 2015 and 2014, 97.1%, 97.8% and 97.7%,
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 year.



Results of Operations



The following table sets forth certain
financial information as a percentage of revenues:



|                                     | Fiscal 2016 | Fiscal 2015 | Fiscal 2014
|------------------------------------ | ----------- | ----------- | -----------
|Revenues                             | 100.0%      | 100.0%      | 100.0%     
|Cost of sales                        | 62.6%       | 61.7%       | 64.2%      
|Gross profit                         | 37.4%       | 38.3%       | 35.8%      
|Operating expenses:                  |             |             |            
|Selling and marketing expenses       | 5.5%        | 5.5%        | 5.2%       
|Administrative expenses              | 6.9%        | 6.9%        | 6.6%       
|Total operating expenses             | 12.4%       | 12.4%       | 11.8%      
|Operating profit                     | 25.0%       | 25.9%       | 24.0%      
|Other income, net                    | 5.0%        | 6.4%        | 5.3%       
|Share in associate's profit / (loss) | –           | –           | –          
|Profit before income taxes           | 30.0%       | 32.3%       | 29.3%      
|Income tax expense                   | 8.4%        | 9.2%        | 8.1%       
|Net profit                           | 21.6%       | 23.1%       | 21.2%      



Results for Fiscal 2016 compared to
Fiscal 2015



Revenues



Our revenues are generated principally
from services provided on either a time-and-materials or a fixed-price, fixed-timeframe basis. Many of our client contracts, including
those that are on a fixed-price, fixed-timeframe basis can be terminated by clients with or without cause and with short notice
periods of between 0 and 90 days. Since we collect revenues as portions of the contracts are completed, terminated contracts are
only subject to collection for portions of the contract completed through the time of termination. In order to manage and anticipate
the risk of early or abrupt contract terminations, we monitor the progress of contracts and change orders according to their characteristics
and the circumstances in which they occur. This includes a review of our ability and our client's ability to perform on the contract,
a review of extraordinary conditions that may lead to a contract termination and a review of the historical client performance
considerations. Since we also bear the risk of cost overruns and inflation with respect to fixed-price, fixed-timeframe projects,
our operating results could be adversely affected by inaccurate estimates of contract completion costs and dates, including wage
inflation rates and currency exchange rates that may affect cost projections. Although we revise our project completion estimates
from time to time, such revisions have not, to date, had a material adverse effect on our operating results or financial condition.



We experience from time to time, pricing
pressure from our clients. For example, clients often expect that as we do more business with them, they will receive volume discounts.
Additionally, clients may ask for fixed-price, fixed-timeframe arrangements or reduced rates. We attempt to use fixed-price arrangements
for engagements where the specifications are complete, so individual rates are not negotiated.



The following table sets forth the growth
in our revenues in fiscal 2016 from fiscal 2015:

(Dollars in
millions)

|         | Fiscal 2016 | Fiscal 2015 | Change | Percentage Change
|-------- | ----------- | ----------- | ------ | -----------------
|Revenues | 9,501       | 8,711       | 790    | 9.1%             



The increase in revenues was primarily
attributable to an increase in volumes in our segments.



During fiscal 2016, we reorganized some
of our segments to enhance executive customer relationships, improve focus of sales investments and increase management oversight.
Consequent to the internal reorganization there were changes effected in the segments based on the “management approach”
as defined in IFRS 8, Operating Segments, Growth Markets (GMU) comprising enterprises in APAC (Asia Pacific) and Africa have been
subsumed across the other verticals and businesses in India, Japan and China are run as standalone regional business units and
Infosys Public services (IPS) is reviewed separately by the Chief Operating Decision Maker (CODM). Further, the erstwhile manufacturing
segment is now being reviewed as Hi-Tech, Manufacturing and others included in ECS (See Note 2.19, Segment reporting, of Item 18
of this Annual report on Form 20-F for additional information). Accordingly, the prior period comparatives have been restated.



The following table sets forth our revenues
by business segments for fiscal 2016 and fiscal 2015:



|Business Segments                                    | Percentage of Revenues
|---------------------------------------------------- | ----------------------
|                                                     | Fiscal 2016           
|Financial Services (FS)                              | 27.3%                 
|Manufacturing (MFG)                                  | 11.0%                 
|Energy & utilities, Communication and Services (ECS) | 21.7%                 
|Retail, Consumer packaged goods and Logistics (RCL)  | 16.4%                 
|Life Sciences, Healthcare and Insurance (HILIFE)     | 13.0%                 
|Hi-Tech                                              | 7.9%                  
|All other Segments                                   | 2.7%                  



There were significant currency movements
during fiscal 2016 as compared to fiscal 2015, the U.S. dollar appreciated by 6.2% against the United Kingdom Pound Sterling, 12.7%
against the Euro and 16.1% against the Australian Dollar.



Had the average exchange rate between
various currencies and the U.S. dollar remained constant, during fiscal 2016 in comparison to fiscal 2015, our revenues in constant
currency terms for fiscal 2016 would have been higher by $366 million at $9,867 million as against our reported revenues of $9,501
million, resulting in a growth of 13.3% as against a reported growth of 9.1%.



The following table sets forth our business
segment profit (revenues less identifiable operating expenses and allocated expenses) as a percentage of business segment revenue
for fiscal 2016 and fiscal 2015 (see Note 2.19.1, Business Segments under Item 18 of this Annual Report on Form 20-F for additional
information):



|Business Segments                                    | Fiscal 2016 | Fiscal 2015
|---------------------------------------------------- | ----------- | -----------
|Financial services (FS)                              | 28.4%       | 29.6%      
|Manufacturing (MFG)                                  | 22.6%       | 22.8%      
|Energy & utilities, Communication and Services (ECS) | 29.6%       | 30.0%      
|Retail, Consumer packaged goods and Logistics (RCL)  | 27.8%       | 30.2%      
|Life Sciences, Healthcare and Insurance (HILIFE)     | 28.0%       | 28.1%      
|Hi-Tech                                              | 26.5%       | 26.7%      
|All other Segments                                   | 15.4%       | 1.2%       



Overall segment profitability has marginally
declinedprimarily on account of increase in cost of efforts (comprising of employee cost and cost
of technical subcontractors), reduction in offshore mix, reduced realized revenue per employee, impact of cross currency partially
offset by gains on account of depreciation of the Indian Rupee against US Dollar and increase in utilization. RCL profitability
has decreased on account of higher cost of technical sub-contractors.



Our revenues are also segmented into onsite
and offshore revenues. The table below sets forth the percentage of our revenues by location for fiscal 2016 and fiscal 2015:



|         | Percentage of revenues
|-------- | ----------------------
|         | Fiscal 2016           
|Onsite   | 53.2%                 
|Offshore | 46.8%                 



We typically assume full project management
responsibility for each project that we undertake. Using our Global Delivery Model, we divide projects into components that we
execute simultaneously at client sites and our Development Centers located outside India (‘onsite’) and at our Global
Development Centers in India (‘offshore’). The proportion of work performed at our facilities and at client sites varies
from quarter-to-quarter. We charge higher rates and incur higher compensation and other expenses for work performed onsite. 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. As a result, our total revenues, cost of sales and gross profit in absolute
terms and as a percentage of revenues fluctuate from quarter-to-quarter.



The table below sets forth details of
billable hours expended for onsite and offshore for fiscal 2016 and fiscal 2015:



|         | Fiscal 2016 | Fiscal 2015
|-------- | ----------- | -----------
|Onsite   | 24.7%       | 24.1%      
|Offshore | 75.3%       | 75.9%      



Revenues from services represented 96.9%
of total revenues for fiscal 2016 as compared to 96.8% for fiscal 2015. We also generate revenue from software application products,
including banking software. Sales of our software products represented 3.1% of our total revenues for fiscal 2016 as compared to
3.2% for fiscal 2015.



The following table sets forth the revenues
from fixed-price, fixed-timeframe contracts and time-and-materials contracts as a percentage of services revenues for fiscal 2016
and fiscal 2015:



|                                       | Percentage of total services revenues
|-------------------------------------- | -------------------------------------
|                                       | Fiscal 2016                          
|Fixed-price, fixed-timeframe contracts | 44.0%                                
|Time-and-materials contracts           | 56.0%                                



Revenues and gross profits are also affected
by employee utilization rates. We define employee utilization as the proportion of total billed person months to total available
person months, excluding sales, administrative and support personnel. We manage utilization by monitoring project requirements
and timetables. The number of software professionals that we assign to a project will vary according to the size, complexity, duration,
and demands of the project. An unanticipated termination of a significant project could also cause lower utilization of technology
professionals. In addition, we do not utilize our technology professionals when they are enrolled in training programs, particularly
during our training course for new employees.



The following table sets forth the utilization
rates of billable IT services professionals:



|                   | Fiscal 2016 | Fiscal 2015
|------------------ | ----------- | -----------
|Including trainees | 75.0%       | 74.6%      
|Excluding trainees | 80.6%       | 80.9%      



The following table sets forth our revenues
by geographic segments for fiscal 2016 and fiscal 2015:



|Geographic Segments | Percentage of revenues
|------------------- | ----------------------
|                    | Fiscal 2016           
|North America       | 62.7%                 
|Europe              | 23.0%                 
|India               | 2.6%                  
|Rest of the World   | 11.7%                 



The decline in percentage of revenues
in Europe and Rest of the World was primarily due to depreciation in the respective currencies in those regions against US Dollar.



The following table sets forth our geographic
segment profit (revenues less identifiable operating expenses and allocated expenses) as a percentage of geographic segment revenue
for fiscal 2016 and fiscal 2015 (see Note 2.19.2, Geographic Segments, under Item 18 of this Annual Report on Form 20-F for additional
information):



|Geographic Segments | Fiscal 2016 | Fiscal 2015
|------------------- | ----------- | -----------
|North America       | 26.2%       | 27.9%      
|Europe              | 27.1%       | 26.8%      
|India               | 35.1%       | 24.1%      
|Rest of the World   | 32.3%       | 31.0%      



Overall segment profitability has marginally
declinedprimarily on account of increase in cost of efforts (comprising of employee cost and cost
of technical subcontractors), reduction in offshore mix, reduced realized revenue per employee, impact of cross currency partially
offset by gains on account of depreciation of the Indian Rupee against US Dollar and increase in utilization. North America profitability
has decreased on account of higher cost of technical sub-contractors.



During fiscal 2016,
the total billed person-months for our IT services professionals grew by 14.5% compared to fiscal 2015. The onsite and offshore
billed person-months for our IT services professionals grew by 16.8% and 13.6%, respectively during fiscal 2016. During fiscal
2016, there was a 7.2% decrease in offshore revenue productivity, and a 4.0% decrease in the onsite revenue productivity of our
IT services professionals when compared to fiscal 2015. On a blended basis, the revenue productivity decreased by 4.7% during fiscal
2016 when compared to fiscal 2015.



Cost of sales



The following table sets forth our cost
of sales for fiscal 2016 and fiscal 2015:

(Dollars in millions)

|                           | Fiscal 2016 | Fiscal 2015 | Change | Percentage Change
|-------------------------- | ----------- | ----------- | ------ | -----------------
|Cost of sales              | 5,950       | 5,374       | 576    | 10.7%            
|As a percentage of revenue | 62.6%       | 61.7%       |        |                  



(Dollars in millions)

|                                                                                 | Fiscal 2016 | Fiscal 2015 | Change
|-------------------------------------------------------------------------------- | ----------- | ----------- | ------
|Employee benefit costs                                                           | 4,627       | 4,299       | 328   
|Deferred purchase price pertaining to acquisition (Refer to note 2.3 of Item 18) | 23          | 41          | (18)  
|Depreciation and amortization                                                    | 222         | 175         | 47    
|Travelling costs                                                                 | 250         | 219         | 31    
|Cost of technical sub-contractors                                                | 537         | 354         | 183   
|Cost of Software packages for own use                                            | 111         | 139         | (28)  
|Third party items bought for service delivery to clients                         | 81          | 31          | 50    
|Operating lease payments                                                         | 37          | 35          | 2     
|Communication costs                                                              | 27          | 34          | (7)   
|Provision for post-sales client support                                          | 1           | 6           | (5)   
|Repairs and maintenance                                                          | 28          | 27          | 1     
|Other expenses                                                                   | 6           | 14          | (8)   
|Total                                                                            | 5,950       | 5,374       | 576   



The increase in cost of sales during
fiscal 2016 from fiscal 2015 was primarily due to increase in cost of efforts (comprising of employees cost and cost of technical
subcontractors). The cost of efforts have increased as a percentage of revenue from 53.4% in fiscal 2015 to 54.4% in fiscal 2016.
The increase in cost of efforts is due an increased engagement of technical sub-contractors to meet certain skill requirements
in complex projects which has been partially offset by a decrease in employee cost as a percentage of revenue. For fiscal 2016
and 2015, 9.0% and 6.6%, respectively, of our cost of sales was attributable to cost of technical subcontractors. We hire subcontractors
from time to time for client requirements and we generally do not perform subcontracted work for other technology service providers.
The increase in employee cost during fiscal 2016 from fiscal 2015 is on account of increased compensation in last 12 months, promotions
and increase in the number of employees partially offset by role mix change and currency impact.



Gross profit



The following table sets forth our gross
profit for fiscal 2016 and fiscal 2015:

(Dollars in millions)

|                           | Fiscal 2016 | Fiscal 2015 | Change | Percentage Change
|-------------------------- | ----------- | ----------- | ------ | -----------------
|Gross profit               | 3,551       | 3,337       | 214    | 6.4%             
|As a percentage of revenue | 37.4%       | 38.3%       |        |                  



The decrease in gross profit as a percentage
of revenue during fiscal 2016 from fiscal 2015 was attributable to an increase in cost of sales as a percentage of revenue during
the same period as explained above.



Selling and marketing expenses



The following table sets forth our selling
and marketing expenses for fiscal 2016 and fiscal 2015:

(Dollars in millions)

|                               | Fiscal 2016 | Fiscal 2015 | Change | Percentage Change
|------------------------------ | ----------- | ----------- | ------ | -----------------
|Selling and marketing expenses | 522         | 480         | 42     | 8.7%             
|As a percentage of revenue     | 5.5%        | 5.5%        |        |                  



(Dollars in millions)

|                                     | Fiscal 2016 | Fiscal 2015 | Change
|------------------------------------ | ----------- | ----------- | ------
|Employee benefit costs               | 403         | 389         | 14    
|Travelling costs                     | 54          | 43          | 11    
|Branding and marketing               | 44          | 26          | 18    
|Operating lease payments             | 7           | 6           | 1     
|Consultancy and professional charges | 7           | 3           | 4     
|Communication costs                  | 3           | 4           | (1)   
|Other expenses                       | 4           | 9           | (5)   
|Total                                | 522         | 480         | 42    



The increase
in selling and marketing expenses during fiscal 2016 from fiscal 2015 was attributable primarily on account of branding and marketing
activities undertaken by the company and increase in travelling cost on account of an overall increase in business. The employee
benefit costs as a percentage of revenue has not changed significantly in fiscal 2016 as compared to fiscal 2015.



Administrative expenses



The following table sets forth our administrative
expenses for fiscal 2016 and fiscal 2015:

(Dollars in millions)

|                           | Fiscal 2016 | Fiscal 2015 | Change | Percentage Change
|-------------------------- | ----------- | ----------- | ------ | -----------------
|Administrative expenses    | 654         | 599         | 55     | 9.2%             
|As a percentage of revenue | 6.9%        | 6.9%        |        |                  



(Dollars in millions)

|                                                           | Fiscal 2016 | Fiscal 2015 | Change
|---------------------------------------------------------- | ----------- | ----------- | ------
|Employee benefit costs                                     | 206         | 174         | 32    
|Consultancy and professional charges                       | 107         | 65          | 42    
|Repairs and maintenance                                    | 131         | 97          | 34    
|Power and fuel                                             | 33          | 36          | (3)   
|Communication costs                                        | 38          | 44          | (6)   
|Travelling costs                                           | 41          | 35          | 6     
|Rates and taxes                                            | 17          | 21          | (4)   
|Operating lease payments                                   | 11          | 9           | 2     
|Insurance charges                                          | 9           | 9           | –     
|Provisions for doubtful trade receivables                  | (7)         | 29          | (36)  
|Contribution towards Corporate Social Responsibility (CSR) | 33          | 42          | (9)   
|Other expenses                                             | 35          | 38          | (3)   
|Total                                                      | 654         | 599         | 55    



The increase
in administrative expenses for fiscal 2016 from fiscal 2015 was primarily due to increase in consultancy and professional charges,
repairs and maintenance, partially offset by a decrease in provision for doubtful trade receivables. The increase in consultancy
and professional charges was due to additional costs arising out of acquisitions, increased recruitment and training initiatives
and increase in other professional fees. The increase in repairs and maintenance cost was primarily on account of higher cost incurred
on maintenance of physical and technology infrastructure. The decrease in Provision for Bad and Doubtful trade receivables was
primarily due to collection of receivables which were earlier provided for.The employee benefit
costs as a percentage of revenue has not changed significantly in fiscal 2016 as compared to fiscal 2015.



Operating profit



The following table sets forth our operating
profit for fiscal 2016 and fiscal 2015:

(Dollars in millions)

|                           | Fiscal 2016 | Fiscal 2015 | Change | Percentage Change
|-------------------------- | ----------- | ----------- | ------ | -----------------
|Operating profit           | 2,375       | 2,258       | 117    | 5.2%             
|As a percentage of revenue | 25.0%       | 25.9%       |        |                  



The decrease in operating profit as a
percentage of revenue for fiscal 2016 from fiscal 2015 was attributable to a decrease of 0.9% in gross profit as a percentage of
revenue during the same period.



Other income



The following table sets forth our other
income for fiscal 2016 and fiscal 2015:

(Dollars in millions)

|                  | Fiscal 2016 | Fiscal 2015 | Change | Percentage Change
|----------------- | ----------- | ----------- | ------ | -----------------
|Other income, net | 476         | 560         | (84)   | (15.0%)          





Other income for fiscal 2016 primarily
includes interest income on deposits and certificates of deposit of $385 million, income from available-for-sale financial assets
of $27 million, and a foreign exchange gain of $4 million on forward and options contracts and foreign exchange gain of $21 million
on translation of other assets and liabilities. The interest income for fiscal 2016 has declined as compared to fiscal 2015 primarily
due to the softening interest rate environment in India.



Other income for fiscal 2015 primarily includes interest income on deposits and certificates of deposit of
$430 million, income from available-for-sale financial assets of $43 million, and a foreign exchange gain of $85 million on forward
and option contracts, partially offset by a foreign exchange loss of $7 million on translation of other assets and liabilities.





Functional Currency and Foreign Exchange



The functional currency of Infosys, Infosys
BPO, controlled trusts, EdgeVerve and Skava Systems Pvt. Ltd. is the Indian rupee. The functional currencies for all of the other
subsidiaries are the respective local currencies. The consolidated financial statements included in this Annual Report on Form
20-F are presented in U.S. dollars (rounded off to the nearest million) to facilitate comparability. The translation of functional
currencies of foreign subsidiaries to U.S. dollars is performed for assets and liabilities using the exchange rate at the
balance sheet date, and for revenue, expenses and cash flow items using a monthly average exchange rate for the respective periods.
The gains or losses resulting from such translation are included in other comprehensive income and presented as currency translation
reserves under other components of equity.



Generally, Indian law requires residents
of India to repatriate any foreign currency earnings to India to control the exchange of foreign currency. More specifically, Section
8 of the Foreign Exchange Management Act, or FEMA, requires an Indian company to take all reasonable steps to realize and repatriate
into India all foreign currency earned by the company outside India, within such time periods and in the manner specified by the
RBI. The RBI has promulgated guidelines that require the company to repatriate any realized foreign currency back to a
foreign currency account such as an Exchange Earners Foreign Currency, or EEFC account with an authorized dealer in India, subject
to the condition that the sum total of the accruals in the account during a calendar month should be converted into rupees on or
before the last day of the succeeding calendar month, after adjusting for utilization of the balances for approved purposes or
forward commitments.



We typically collect our earnings denominated
in foreign currencies using a dedicated foreign currency account located in the local country of operation. In order to do this,
we are required to obtain, and have obtained, approval from an authorized dealer, on behalf of the RBI, to maintain a foreign currency
account in overseas countries.



Our failure to comply with RBI regulations
could result in RBI enforcement actions against us.



We generate substantially all of our
revenues in foreign currencies, particularly the U.S. dollar, the United Kingdom Pound Sterling, Euro and the Australian dollar,
whereas we incur a significant portion of our expenses in Indian rupees. The exchange rate between the Indian rupee and the U.S.
dollar has changed substantially in recent years and may fluctuate substantially in the future. Consequently, the results of our
operations are adversely affected as the Indian rupee appreciates against the U.S. dollar. Foreign exchange gains and losses arise
from the depreciation and appreciation of the Indian rupee against other currencies in which we transact business and from foreign
exchange forward and option contracts.



The following table sets forth the currencies
in which our revenues for fiscal 2016 and fiscal 2015 were denominated:



|Currency                      | Percentage of Revenues
|----------------------------- | ----------------------
|                              | Fiscal 2016           
|U.S. dollar                   | 69.9%                 
|United Kingdom Pound Sterling | 6.6%                  
|Euro                          | 9.3%                  
|Australian dollar             | 6.9%                  
|Others                        | 7.3%                  



The following table sets forth information
on the foreign exchange rates in rupees per U.S. dollar, United Kingdom Pound Sterling, Euro and Australian dollar for fiscal 2016
and fiscal 2015:



|                                         | Fiscal 2016() | Fiscal 2015() | Appreciation / (Depreciation)in percentage
|---------------------------------------- | ------------- | ------------- | ------------------------------------------
|Average exchange rate during the period: |               |               |                                           
|U.S. dollar                              | 65.69         | 61.18         | (7.4%)                                    
|United Kingdom Pound Sterling            | 98.88         | 98.37         | (0.5%)                                    
|Euro                                     | 72.51         | 77.06         | 5.9%                                      
|Australian dollar                        | 48.27         | 53.11         | 9.1%                                      



|                                                                                                               | Fiscal 2016() | Fiscal 2015()
|-------------------------------------------------------------------------------------------------------------- | ------------- | -------------
|Exchange rate at the beginning of the period: (a)                                                              |               |              
|U.S. dollar                                                                                                    | 62.50         | 59.92        
|United Kingdom Pound Sterling                                                                                  | 92.47         | 99.77        
|Euro                                                                                                           | 67.19         | 82.69        
|Australian dollar                                                                                              | 47.54         | 55.30        
|Exchange rate at the end of the period: (b)                                                                    |               |              
|U.S. dollar                                                                                                    | 66.26         | 62.50        
|United Kingdom Pound Sterling                                                                                  | 95.47         | 92.47        
|Euro                                                                                                           | 75.40         | 67.19        
|Australian dollar                                                                                              | 50.98         | 47.54        
|Appreciation / (Depreciation) of the Indian rupee against the relevant currency: ((b) / (a) - as a percentage) |               |              
|U.S. dollar                                                                                                    | (6.0)%        | (4.3)%       
|United Kingdom Pound Sterling                                                                                  | (3.2)%        | 7.3%         
|Euro                                                                                                           | (12.2)%       | 18.7%        
|Australian dollar                                                                                              | (7.2)%        | 14.0%        



The following table sets forth information
on the foreign exchange rates in U.S. dollar per United Kingdom Pound Sterling, Euro and Australian dollar for fiscal 2016 and
fiscal 2015:



|                                         | Fiscal 2016 ($) | Fiscal 2015 ($) | Appreciation / (Depreciation)in percentage
|---------------------------------------- | --------------- | --------------- | ------------------------------------------
|Average exchange rate during the period: |                 |                 |                                           
|United Kingdom Pound Sterling            | 1.51            | 1.61            | 6.2%                                      
|Euro                                     | 1.10            | 1.26            | 12.7%                                     
|Australian dollar                        | 0.73            | 0.87            | 16.1%                                     



|                                                                                                          | Fiscal 2016 ($) | Fiscal 2015 ($)
|--------------------------------------------------------------------------------------------------------- | --------------- | ---------------
|Exchange rate at the beginning of the period: (a)                                                         |                 |                
|United Kingdom Pound Sterling                                                                             | 1.48            | 1.67           
|Euro                                                                                                      | 1.08            | 1.38           
|Australian dollars                                                                                        | 0.76            | 0.92           
|Exchange rate at the end of the period: (b)                                                               |                 |                
|United Kingdom Pound Sterling                                                                             | 1.44            | 1.48           
|Euro                                                                                                      | 1.14            | 1.08           
|Australian dollar                                                                                         | 0.77            | 0.76           
|Appreciation / (Depreciation) of U.S. dollar against the relevant currency: ((b) / (a) - as a percentage) |                 |                
|United Kingdom Pound Sterling                                                                             | 2.7%            | 11.4%          
|Euro                                                                                                      | (5.6)%          | 21.7%          
|Australian dollar                                                                                         | (1.3)%          | 17.4%          



For fiscal 2016 and fiscal 2015, every
percentage point depreciation / appreciation in the exchange rate between the Indian rupee and the U.S. dollar has affected our
incremental operating margins by approximately 0.50% and 0.52%, respectively. The exchange rate between the Indian rupee and the
U.S. dollar has fluctuated substantially in recent years and may continue to do so in the future. We are unable to predict the
impact that future fluctuations may have on our operating margins. For more discussion on our foreign exchange exposure, see Item
3 in the section titled “Risk Factors - Risks Related to Our Company and Our Industry - Currency fluctuations may affect
the results or our operations” in this Annual Report on Form 20-F.



We recorded a gain of $4 million and
$85 million for fiscal 2016 and fiscal 2015, respectively, on account of foreign exchange forward and option contracts and foreign
exchange gain of $21 million and foreign exchange loss of $7 million on translation of other assets and liabilities for fiscal
2016 and fiscal 2015, respectively. Our accounting policy requires us to mark to market and recognize the effect in statement of
comprehensive income immediately of any derivative that is either not designated as a hedge, or is so designated but is ineffective
as per IAS 39.



Income tax expense



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 a credit against our tax liability in India.



We, being a resident company in India
as per the provisions of the Income Tax Act, 1961, are required to pay taxes in India on the global income in accordance with the
provisions of Section 5 of the Indian Income Tax Act, 1961, which is reflected as domestic taxes. The geographical segment disclosures
on revenue in note 2.19.2 of Item 18 of this Annual Report on Form 20-F are based on the location of customers and do not reflect
the geographies where the actual delivery or revenue-related efforts occur. The income on which domestic taxes are imposed are
not restricted to the income generated from the “India” geographic segment. As such, amounts applicable to domestic
income taxes and foreign income taxes will not necessarily correlate to the proportion of revenue generated from India and other
geographical segments.



In India, we have benefited from certain tax incentives that the Government of India had provided for the
export of software from the units registered under the Software Technology Parks Scheme (STP) and we continue to benefit from certain
tax incentives for the units registered under the Special Economic Zones Act, 2005 (SEZ). However, as the income tax incentives
provided by the Government of India for STP units have expired, the income from all of our STP units are now taxable. SEZ units
that began the provision of 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 percent of such profits or gains for the five years thereafter. Up to 50% of such profits or gains is also available for
a further five years subject to creation of a Special Economic Zone 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.



As a result of these tax incentives,
a portion of our pre-tax income has not been subject to income tax. These tax incentives resulted in a decrease in our income tax
expense of $268 million and $273 million for fiscal 2016 and 2015, respectively, compared to the tax amounts that we estimate we
would have been required to pay if these incentives had not been available. The per share effect of these tax incentives computed
based on both basic and diluted weighted average number of equity shares for fiscal 2016 and 2015 was $0.12 each. The basic and
diluted weighted average number of equity shares have been adjusted for bonus issue, wherever applicable (See Note 2.12, Equity,
under Item 18 of this Annual Report on Form 20-F for additional information). See Note 2.16, Income Taxes, under Item 18 of this
Annual Report on Form 20-F for reconciliation of the income tax provision to the amount computed by applying the statutory income
tax rate to the income before income taxes.



The following table sets forth our income
tax expense and effective tax rate for fiscal 2016 and fiscal 2015:

(Dollars
in millions)

|                   | Fiscal 2016 | Fiscal 2015 | Change | Percentage Change
|------------------ | ----------- | ----------- | ------ | -----------------
|Income tax expense | 799         | 805         | (6)    | (0.8%)           
|Effective tax rate | 28.0%       | 28.6%       |        |                  



Our effective tax rate for the fiscal
2016 was 28.0% compared to 28.6% for fiscal 2015. Effective tax rate is generally influenced by various factors including non-deductible
expenses, exempt non-operating income, overseas taxes, benefits from SEZ units and other tax deductions. The decrease in the effective
tax rate to 28.0% for the fiscal 2016 compared to fiscal 2015, was mainly due to a decrease in overseas taxes, increase in tax
reversals (net) partially offset by decrease in benefits from SEZ units as a percentage of profit before income taxes and increase
in tax rates. The tax reversals (net) comprise of reversal of provisions of $51 million made in earlier periods which is partially
offset by an additional tax provision of $4 million pertaining to prior periods. The reversal of the provision is primarily due
to completion of audits in certain jurisdictions. (See Note 2.16, Income Taxes, under Item 18 of this Annual report on Form 20-F
for a reconciliation of the income tax provision to the amount computed by applying the statutory income tax rate to the income
before income taxes).



Net profit



The following table sets forth our net
profit for fiscal 2016 and fiscal 2015:

(Dollars in millions)

|                            | Fiscal 2016 | Fiscal 2015 | Change | Percentage Change
|--------------------------- | ----------- | ----------- | ------ | -----------------
|Net profit                  | 2,052       | 2,013       | 39     | 1.9%             
|As a percentage of revenues | 21.6%       | 23.1%       |        |                  



The decrease in net profit as a percentage of revenues for fiscal 2016 as compared to fiscal 2015 was primarily
attributable to a 0.9% decrease in operating profit as a percentage of revenue and decrease in other income partially offset by
a decrease in effective tax rate, as explained above.



Results for Fiscal 2015 compared to
Fiscal 2014



Revenues



Our revenues are generated principally
from services provided on either a time-and-materials or a fixed-price, fixed-timeframe basis. Many of our client contracts, including
those that are on a fixed-price, fixed-timeframe basis can be terminated by clients with or without cause and with short notice
periods of between 0 and 90 days. Since we collect revenues as portions of the contracts are completed, terminated contracts are
only subject to collection for portions of the contract completed through the time of termination. In order to manage and anticipate
the risk of early or abrupt contract terminations, we monitor the progress of contracts and change orders according to their characteristics
and the circumstances in which they occur. This includes a review of our ability and our client's ability to perform on the contract,
a review of extraordinary conditions that may lead to a contract termination and a review of the historical client performance
considerations. Since we also bear the risk of cost overruns and inflation with respect to fixed-price, fixed-timeframe projects,
our operating results could be adversely affected by inaccurate estimates of contract completion costs and dates, including wage
inflation rates and currency exchange rates that may affect cost projections. Although we revise our project completion estimates
from time to time, such revisions have not, to date, had a material adverse effect on our operating results or financial condition.



We experience from time to time, pricing
pressure from our clients. For example, clients often expect that as we do more business with them, they will receive volume discounts.
Additionally, clients may ask for fixed-price, fixed-timeframe arrangements or reduced rates. We attempt to use fixed-price arrangements
for engagements where the specifications are complete, so individual rates are not negotiated.



The following table sets forth the growth
in our revenues in fiscal 2015 from fiscal 2014:

(Dollars in
millions)

|         | Fiscal 2015 | Fiscal 2014 | Change | Percentage Change
|-------- | ----------- | ----------- | ------ | -----------------
|Revenues | 8,711       | 8,249       | 462    | 5.6%             



The increase in revenues was attributable
to an increase in volumes in our segments.





During fiscal 2016, we reorganized some of our segments to further sharpen focus on industry segments and
increase management oversight. Consequent to the internal reorganization there were changes effected in the segments based on the
“management approach” as defined in IFRS 8, Operating Segments, Growth Markets (GMU) comprising enterprises in APAC
(Asia Pacific) and Africa have been subsumed across the other verticals and businesses in India, Japan and China are run as standalone
regional business units and Infosys Public services (IPS) is reviewed separately by the Chief Operating Decision Maker (CODM).
Further, the erstwhile manufacturing segment is now being reviewed as Hi-Tech, Manufacturing and others included in ECS. Accordingly,
the numbers for fiscal 2015 and fiscal 2014 have been restated. (See Note 2.19, Segment reporting, of Item 18 of this Annual report
on Form 20-F for additional information).



The following table sets forth our revenues
by business segments for fiscal 2015 and fiscal 2014:



|Business Segments                                    | Percentage of Revenues
|---------------------------------------------------- | ----------------------
|                                                     | Fiscal 2015           
|Financial Services (FS)                              | 27.0%                 
|Manufacturing (MFG)                                  | 11.6%                 
|Energy & utilities, Communication and Services (ECS) | 22.5%                 
|Retail, Consumer packaged goods and Logistics (RCL)  | 16.6%                 
|Life Sciences, Healthcare and Insurance (HILIFE)     | 12.6%                 
|Hi-Tech                                              | 7.3%                  
|All other Segments                                   | 2.4%                  



There were significant currency movements
during fiscal 2015 as compared to fiscal 2014, the U.S. dollar appreciated by 6.5% and 6.7% against the Australian dollar and Euro,
respectively and depreciated by 0.6% against the United Kingdom Pound Sterling.



Had the average exchange rate between
various currencies and the U.S. dollar remained constant, during fiscal 2015 in comparison to fiscal 2014, our revenues in constant
currency terms for fiscal 2015 would have been higher by $122 million at $8,833 million as against our reported revenues of $8,711
million, resulting in a growth of 7.1% as against a reported growth of 5.6%.



The following table sets forth our business
segment profit (revenues less identifiable operating expenses and allocated expenses) as a percentage of business segment revenue
for fiscal 2015 and fiscal 2014 (see Note 2.19.1, Business Segments, under Item 18 of this Annual Report on Form 20-F for additional
information):



|Business Segments                                    | Fiscal 2015 | Fiscal 2014
|---------------------------------------------------- | ----------- | -----------
|Financial services (FS)                              | 29.6%       | 28.9%      
|Manufacturing (MFG)                                  | 22.8%       | 20.5%      
|Energy & utilities, Communication and Services (ECS) | 30.0%       | 29.1%      
|Retail, Consumer packaged goods and Logistics (RCL)  | 30.2%       | 26.8%      
|Life Sciences, Healthcare and Insurance (HILIFE)     | 28.1%       | 27.1%      
|Hi-Tech                                              | 26.7%       | 26.2%      
|All other Segments                                   | 1.2%        | 9.9%       



Profitability across most of the segments
has improved primarily on account of improved utilization and improved offshore mix which was partially offset by the investments
in business through compensation increases given to employees during the last 12 months, promotions, increase in variable payout
and adverse cross currency movement. Consequent to the requirements of the Indian Companies Act, 2013, $42 million was contributed
towards Corporate Social Responsibility (CSR) activities during the fiscal 2015. The segment profitability for fiscal 2014 included
a provision of $35 million towards visa related matters. RCL profitability has increased on account of higher offshore mix and
utilization rates.



Our revenues are also segmented into onsite
and offshore revenues. The table below sets forth the percentage of our revenues by location for fiscal 2015 and fiscal 2014:



|         | Percentage of revenues
|-------- | ----------------------
|         | Fiscal 2015           
|Onsite   | 51.2%                 
|Offshore | 48.8%                 



We typically assume full project management
responsibility for each project that we undertake. Using our Global Delivery Model, we divide projects into components that we
execute simultaneously at client sites and our Development Centers located outside India (‘onsite’) and at our Global
Development Centers in India (‘offshore’). The proportion of work performed at our facilities and at client sites varies
from quarter-to-quarter. We charge higher rates and incur higher compensation and other expenses for work performed onsite. 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. As a result, our total revenues, cost of sales and gross profit in absolute
terms and as a percentage of revenues fluctuate from quarter-to-quarter.



The table below sets forth details of
billable hours expended for onsite and offshore for fiscal 2015 and fiscal 2014:



|         | Fiscal 2015 | Fiscal 2014
|-------- | ----------- | -----------
|Onsite   | 24.1%       | 25.2%      
|Offshore | 75.9%       | 74.8%      



Revenues from services represented 96.8%
of total revenues for fiscal 2015 as compared to 96.4% for fiscal 2014. We also generate revenue from software application products,
including banking software. Sales of our software products represented 3.2% of our total revenues for fiscal 2015 as compared to
3.6% for fiscal 2014.



The following table sets forth the revenues
from fixed-price, fixed-timeframe contracts and time-and-materials contracts as a percentage of services revenues for fiscal 2015
and fiscal 2014:



|                                       | Percentage of total services revenues
|-------------------------------------- | -------------------------------------
|                                       | Fiscal 2015                          
|Fixed-price, fixed-timeframe contracts | 42.1%                                
|Time-and-materials contracts           | 57.9%                                



Revenues and gross profits are also affected
by employee utilization rates. We define employee utilization as the proportion of total billed person months to total available
person months, excluding sales, administrative and support personnel. We manage utilization by monitoring project requirements
and timetables. The number of software professionals that we assign to a project will vary according to the size, complexity, duration,
and demands of the project. An unanticipated termination of a significant project could also cause lower utilization of technology
professionals. In addition, we do not utilize our technology professionals when they are enrolled in training programs, particularly
during our training course for new employees.



The following table sets forth the utilization
rates of billable IT services professionals:



|                   | Fiscal 2015 | Fiscal 2014
|------------------ | ----------- | -----------
|Including trainees | 74.6%       | 72.3%      
|Excluding trainees | 80.9%       | 76.4%      



The following table sets forth our revenues
by geographic segments for fiscal 2015 and fiscal 2014:



|Geographic Segments | Percentage of revenues
|------------------- | ----------------------
|                    | Fiscal 2015           
|North America       | 61.5%                 
|Europe              | 24.1%                 
|India               | 2.4%                  
|Rest of the World   | 12.0%                 



The following table sets forth our geographic
segment profit (revenues less identifiable operating expenses and allocated expenses) as a percentage of geographic segment revenue
for fiscal 2015 and fiscal 2014 (see Note 2.19.2, Geographical Segments, under Item 18 of this Annual Report on Form 20-F for additional
information):



|Geographic Segments | Fiscal 2015 | Fiscal 2014
|------------------- | ----------- | -----------
|North America       | 27.9%       | 26.0%      
|Europe              | 26.8%       | 25.4%      
|India               | 24.1%       | 27.3%      
|Rest of the World   | 31.0%       | 32.7%      



Profitability across most of the segments
has improved primarily on account of improved utilization and improved offshore mix which was partially offset by the investments
in business through compensation increases given to employees during the last 12 months, promotions, increases in variable payout
and adverse cross currency movement. Consequent to the requirements of the Indian Companies Act, 2013, $42 million was contributed
towards CSR activities during the fiscal 2015. The profitability in Europe and Rest of the World has been impacted by adverse cross
currency movement. However in Europe, the impact of the same has been partially offset by improved margins of Infosys Lodestone.
The segment profitability of North America for the fiscal 2014 included a provision of $35 million towards visa related matters.



During fiscal 2015, the total billed
person-months for our IT services professionals grew by 9.3% compared to fiscal 2014. The onsite and offshore billed person-months
for our IT services professionals grew by 2.9% and 12.1%, respectively during fiscal 2015. During fiscal 2015, there was a 2.7%
decrease in offshore revenue productivity, and a 1.1% increase in the onsite revenue productivity of our IT services professional
when compared to fiscal 2014. On a blended basis, the revenue productivity decreased by 2.8% during fiscal 2015 when compared to
fiscal 2014.



Cost of sales



The following table sets forth our cost
of sales for fiscal 2015 and fiscal 2014:

(Dollars in millions)

|                           | Fiscal 2015 | Fiscal 2014 | Change | Percentage Change
|-------------------------- | ----------- | ----------- | ------ | -----------------
|Cost of sales              | 5,374       | 5,292       | 82     | 1.5%             
|As a percentage of revenue | 61.7%       | 64.2%       |        |                  



(Dollars in millions)

|                                                                                    | Fiscal 2015 | Fiscal 2014 | Change
|----------------------------------------------------------------------------------- | ----------- | ----------- | ------
|Employee benefit costs                                                              | 4,299       | 4,222       | 77    
|Deferred purchase price pertaining to acquisition (Refer to note 2.3 under Item 18) | 41          | 31          | 10    
|Depreciation and amortization                                                       | 175         | 226         | (51)  
|Travelling costs                                                                    | 219         | 225         | (6)   
|Cost of technical sub-contractors                                                   | 354         | 322         | 32    
|Cost of Software packages for own use                                               | 139         | 128         | 11    
|Third party items bought for service delivery to clients                            | 31          | 32          | (1)   
|Operating lease payments                                                            | 35          | 35          | –     
|Communication costs                                                                 | 34          | 26          | 8     
|Provision for post-sales client support                                             | 6           | 8           | (2)   
|Repairs and maintenance                                                             | 27          | 18          | 9     
|Other expenses                                                                      | 14          | 19          | (5)   
|Total                                                                               | 5,374       | 5,292       | 82    



The increase in cost of sales during
fiscal 2015 from fiscal 2014 was attributable primarily to an increase in our employee benefit costs and cost of technical sub-contractors
partially offset by decrease in depreciation. The increase in employee benefit costs during the fiscal 2015 from fiscal 2014 was
primarily due to compensation increases given to employees during the last 12 months, promotions, higher variable payout and an
increase in the number of employees partially offset by reduction in onsite mix, role mix change and cross currency impact. The
decrease in depreciation is primarily on account of changes in the estimated useful life of buildings and computer equipment. During
the three months ended June 30, 2014, the management based on internal and external technical evaluation reassessed the remaining
useful life of assets primarily consisting of buildings and computer equipment with effect from April 1, 2014. Accordingly, the
useful lives of certain assets required a change from the previous estimates. Had the group continued with the previously assessed
useful lives, charge for depreciation and cost of sales for the fiscal 2015 would have been higher by $72 million for assets held
at April 1, 2014 (see note 2.5 in Item 18 of this Annual Report on Form 20-F for additional information).



We hire subcontractors on a
limited basis from time to time for client requirements and we generally do not perform subcontracted work for other
technology service providers. For fiscal 2015 and  2014,   6.6% and 6.1% respectively, of our cost of sales was
attributable to cost of technical subcontractors.



Gross profit



The following table sets forth our gross
profit for fiscal 2015 and fiscal 2014:

(Dollars in millions)

|                           | Fiscal 2015 | Fiscal 2014 | Change | Percentage Change
|-------------------------- | ----------- | ----------- | ------ | -----------------
|Gross profit               | 3,337       | 2,957       | 380    | 12.9%            
|As a percentage of revenue | 38.3%       | 35.8%       |        |                  



The increase in gross profit as a percentage
of revenue during fiscal 2015 from fiscal 2014 was attributable to a decrease in cost of sales as a percentage of revenue, during
the same period, as explained above.



Selling and marketing expenses



The following table sets forth our selling
and marketing expenses for fiscal 2015 and fiscal 2014:

(Dollars in millions)

|                               | Fiscal 2015 | Fiscal 2014 | Change | Percentage Change
|------------------------------ | ----------- | ----------- | ------ | -----------------
|Selling and marketing expenses | 480         | 431         | 49     | 11.4%            
|As a percentage of revenue     | 5.5%        | 5.2%        |        |                  



(Dollars in millions)

|                                     | Fiscal 2015 | Fiscal 2014 | Change
|------------------------------------ | ----------- | ----------- | ------
|Employee benefit costs               | 389         | 356         | 33    
|Travelling costs                     | 43          | 32          | 11    
|Branding and marketing               | 26          | 22          | 4     
|Operating lease payments             | 6           | 7           | (1)   
|Consultancy and professional charges | 3           | 3           | –     
|Communication costs                  | 4           | 4           | –     
|Other expenses                       | 9           | 7           | 2     
|Total                                | 480         | 431         | 49    



The increase
in selling and marketing expenses during fiscal 2015 from fiscal 2014 was attributable primarily to an increase in the employee
benefit costs on account of increase in the number of employees, compensation increases given to sales and marketing personnel
during the last 12 months, promotions, increase in variable payout and cross currency impact. The increase in travelling cost was
on account of an overall increase in business.



Administrative expenses



The following table sets forth our administrative
expenses for fiscal 2015 and fiscal 2014:

(Dollars in millions)

|                           | Fiscal 2015 | Fiscal 2014 | Change | Percentage Change
|-------------------------- | ----------- | ----------- | ------ | -----------------
|Administrative expenses    | 599         | 547         | 52     | 9.5%             
|As a percentage of revenue | 6.9%        | 6.6%        |        |                  



(Dollars in millions)

|                                                           | Fiscal 2015 | Fiscal 2014 | Change
|---------------------------------------------------------- | ----------- | ----------- | ------
|Employee benefit costs                                     | 174         | 168         | 6     
|Consultancy and professional charges                       | 65          | 80          | (15)  
|Repairs and maintenance                                    | 97          | 77          | 20    
|Power and fuel                                             | 36          | 36          | –     
|Communication costs                                        | 44          | 42          | 2     
|Travelling costs                                           | 35          | 23          | 12    
|Rates and taxes                                            | 21          | 17          | 4     
|Operating lease payments                                   | 9           | 11          | (2)   
|Insurance charges                                          | 9           | 9           | –     
|Provisions for doubtful trade receivables                  | 29          | 23          | 6     
|Contribution towards Corporate Social Responsibility (CSR) | 42          | –           | 42    
|Other
    expenses (Refer note 2.20)                       | 38          | 61          | (23)  
|Total                                                      | 599         | 547         | 52    



The increase in administrative expenses
for fiscal 2015 from fiscal 2014 was primarily due to increase in repairs and maintenance, contribution towards CSR, partially
offset by a decrease in consultancy and professional charges and other expenses. The increase in the employee benefit costs was
on account of compensation increase during the last 12 months, promotions and increase in variable payout offset by reduction in
person months and cross currency impact. Consequent to the requirements of the Indian Companies Act, 2013, a CSR committee has
been formed by the company to formulate and monitor the CSR policy of the company and $42 million was contributed towards CSR activities
during fiscal 2015. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture,
healthcare, destitute care and rehabilitation and rural development projects. The funds were primarily allocated to a corpus and
utilized through the year on these activities. Other expenses for fiscal 2014 include a charge of $35 million towards visa related
matters (See note 2.20 under Item 18 of this Annual Report on Form 20-F for additional information).



Operating profit



The following table sets forth our operating
profit for fiscal 2015 and fiscal 2014:

(Dollars in millions)

|                           | Fiscal 2015 | Fiscal 2014 | Change | Percentage Change
|-------------------------- | ----------- | ----------- | ------ | -----------------
|Operating profit           | 2,258       | 1,979       | 279    | 14.1%            
|As a percentage of revenue | 25.9%       | 24.0%       |        |                  



The increase in operating profit as a
percentage of revenue for fiscal 2015 from fiscal 2014 was attributable to an increase of 2.5% in gross profit as a percentage
of revenue partially offset by a 0.3% increase in selling and marketing expenses and a 0.3% increase in administrative expenses
as a percentage of revenue.



Other income



The following table sets forth our other
income for fiscal 2015 and fiscal 2014:

(Dollars in millions)

|                  | Fiscal 2015 | Fiscal 2014 | Change | Percentage Change
|----------------- | ----------- | ----------- | ------ | -----------------
|Other income, net | 560         | 440         | 120    | 27.3%            



Other income for fiscal 2015 primarily
includes interest income on deposits and certificates of deposit of $430 million, income from available-for-sale financial assets
of $43 million, and a foreign exchange gain of $85 million on forward and options contracts, partially offset by foreign exchange
loss of $7 million on translation of other assets and liabilities.



Other income for fiscal 2014 primarily
includes interest income on deposits and certificates of deposit of $356 million, income from available-for-sale financial assets
of $37 million, foreign exchange gain of $78 million on translation of other assets and liabilities, partially offset by a foreign
exchange loss of $40 million on forward and options contracts.



The increase in interest income, including
income from available-for-sale financial assets, for fiscal 2015 over fiscal 2014 is primarily on account of an increase in investible
surplus.



Functional Currency and Foreign Exchange



The functional currency of Infosys, Infosys
BPO, EdgeVerve and controlled trusts is the Indian rupee. The functional currencies for all of the other subsidiaries are
the respective local currencies. The consolidated financial statements included in this Annual Report on Form 20-F are presented
in U.S. dollars (rounded off to the nearest million) to facilitate comparability. The translation of functional currencies of foreign
subsidiaries to U.S. dollars is performed for assets and liabilities using the exchange rate at the balance sheet date, and
for revenue, expenses and cash flow items using a monthly average exchange rate for the respective periods. The gains or losses
resulting from such translation are included in other comprehensive income and presented as currency translation reserves under
other components of equity.



We generate substantially all of our
revenues in foreign currencies, particularly the U.S. dollar, the United Kingdom Pound Sterling, Euro and the Australian dollar,
whereas we incur a significant portion of our expenses in Indian rupees. The exchange rate between the Indian rupee and the U.S.
dollar has changed substantially in recent years and may fluctuate substantially in the future. Consequently, the results of our
operations are adversely affected as the Indian rupee appreciates against the U.S. dollar. Foreign exchange gains and losses arise
from the depreciation and appreciation of the Indian rupee against other currencies in which we transact business and from foreign
exchange forward and option contracts.



The following table sets forth the currencies
in which our revenues for fiscal 2015 and fiscal 2014 were denominated:



|Currency                      | Percentage of Revenues
|----------------------------- | ----------------------
|                              | Fiscal 2015           
|U.S. dollar                   | 68.9%                 
|United Kingdom Pound Sterling | 5.9%                  
|Euro                          | 10.2%                 
|Australian dollar             | 7.6%                  
|Others                        | 7.4%                  



The following table sets forth information
on the foreign exchange rates in rupees per U.S. dollar, United Kingdom Pound Sterling, Euro and Australian dollar for fiscal 2015
and fiscal 2014:



|                                         | Fiscal 2015() | Fiscal 2014() | Appreciation / (Depreciation)in percentage
|---------------------------------------- | ------------- | ------------- | ------------------------------------------
|Average exchange rate during the period: |               |               |                                           
|U.S. dollar                              | 61.18         | 60.75         | (0.7)%                                    
|United Kingdom Pound Sterling            | 98.37         | 97.00         | (1.4)%                                    
|Euro                                     | 77.06         | 81.77         | 5.8%                                      
|Australian dollar                        | 53.11         | 56.28         | 5.6%                                      



|                                                                                                               | Fiscal 2015() | Fiscal 2014()
|-------------------------------------------------------------------------------------------------------------- | ------------- | -------------
|Exchange rate at the beginning of the period: (a)                                                              |               |              
|U.S. dollar                                                                                                    | 59.92         | 54.29        
|United Kingdom Pound Sterling                                                                                  | 99.77         | 82.23        
|Euro                                                                                                           | 82.69         | 69.50        
|Australian dollar                                                                                              | 55.30         | 56.63        
|Exchange rate at the end of the period: (b)                                                                    |               |              
|U.S. dollar                                                                                                    | 62.50         | 59.92        
|United Kingdom Pound Sterling                                                                                  | 92.47         | 99.77        
|Euro                                                                                                           | 67.19         | 82.69        
|Australian dollar                                                                                              | 47.54         | 55.30        
|Appreciation / (Depreciation) of the Indian rupee against the relevant currency: ((b) / (a) - as a percentage) |               |              
|U.S. dollar                                                                                                    | (4.3)%        | (10.4)%      
|United Kingdom Pound Sterling                                                                                  | 7.3%          | (21.3)%      
|Euro                                                                                                           | 18.7%         | (19.0)%      
|Australian dollar                                                                                              | 14.0%         | 2.3%         



The following table sets forth information
on the foreign exchange rates in U.S. dollar per United Kingdom Pound Sterling, Euro and Australian dollar for fiscal 2015 and
fiscal 2014:



|                                         | Fiscal 2015 ($) | Fiscal 2014 ($) | Appreciation / (Depreciation)in percentage
|---------------------------------------- | --------------- | --------------- | ------------------------------------------
|Average exchange rate during the period: |                 |                 |                                           
|United Kingdom Pound Sterling            | 1.61            | 1.60            | (0.6)%                                    
|Euro                                     | 1.26            | 1.35            | 6.7%                                      
|Australian dollar                        | 0.87            | 0.93            | 6.5%                                      



|                                                                                                              | Fiscal 2015 ($) | Fiscal 2014 ($)
|------------------------------------------------------------------------------------------------------------- | --------------- | ---------------
|Exchange rate at the beginning of the period: (a)                                                             |                 |                
|United Kingdom Pound Sterling                                                                                 | 1.67            | 1.51           
|Euro                                                                                                          | 1.38            | 1.28           
|Australian dollars                                                                                            | 0.92            | 1.04           
|Exchange rate at the end of the period: (b)                                                                   |                 |                
|United Kingdom Pound Sterling                                                                                 | 1.48            | 1.67           
|Euro                                                                                                          | 1.08            | 1.38           
|Australian dollar                                                                                             | 0.76            | 0.92           
|Appreciation / (Depreciation)
    of U.S. dollar against the relevant currency: ((b) / (a) - as a percentage) |                 |                
|United Kingdom Pound
    Sterling                                                                             | 11.4%           | (10.6)%        
|Euro                                                                                                          | 21.7%           | (7.8)%         
|Australian
    dollar                                                                                         | 17.4%           | 11.5%          



For fiscal 2015 and fiscal 2014, every
percentage point depreciation / appreciation in the exchange rate between the Indian rupee and the U.S. dollar has affected our
incremental operating margins by approximately 0.52% and 0.48%, respectively. The exchange rate between the Indian rupee and the
U.S. dollar has fluctuated substantially in recent years and may continue to do so in the future. We are unable to predict the
impact that future fluctuations may have on our operating margins.



We recorded a gain of $85 million and
loss of $40 million for fiscal 2015 and fiscal 2014, respectively, on account of foreign exchange forward and option contracts
and foreign exchange loss of $7 million and foreign exchange gain $78 million on translation of other assets and liabilities for
fiscal 2015 and fiscal 2014, respectively. Our accounting policy requires us to mark to market and recognize the effect in statement
of comprehensive income immediately of any derivative that is either not designated as a hedge, or is so designated but is ineffective
as per IAS 39.



Income tax expense



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 a credit against our tax liability in India.



We, being a resident company in India
as per the provisions of the Income Tax Act, 1961, are required to pay taxes in India on the global income in accordance with the
provisions of Section 5 of the Indian Income Tax Act, 1961, which is reflected as domestic taxes. The geographical segment disclosures
on revenue in note 2.19.2 of Item 18 of this Annual Report on Form 20-F are based on the location of customers and do not reflect
the geographies where the actual delivery or revenue-related efforts occur. The income on which domestic taxes are imposed are
not restricted to the income generated from the “India” geographic segment. As such, amounts applicable to domestic
income taxes and foreign income taxes will not necessarily correlate to the proportion of revenue generated from India and other
geographical segments.



In India, we have benefited from certain
tax incentives that the Government of India had provided for the export of software from the units registered under the Software
Technology Parks Scheme (‘STP’) and we continue to benefit from certain tax incentives for the units registered under
the Special Economic Zones Act, 2005 (SEZ). However, as the income tax incentives provided by the Government
of India for STP units have expired, the income from all of our STP units are now taxable. SEZ units which began provision of
services on or after April 1, 2005 are eligible for a deduction of 100 percent 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 percent
of such profits or gains for the five years thereafter. Up to 50% of such profits or gains is also available for a further five
years subject to creation of a Special Economic Zone 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.



As a result of these tax incentives,
a portion of our pre-tax income has not been subject to income tax. These tax incentives resulted in a decrease in our income tax
expense of $273 million and $273 million for fiscal 2015 and 2014, respectively, compared to the tax amounts that we estimate we
would have been required to pay if these incentives had not been available. The per share effect of these tax incentives computed
based on both basic and diluted weighted average number of equity shares for fiscal 2015 and 2014 was $0.12 each and $0.12 each,
respectively. The basic and diluted weighted average number of equity shares have been adjusted for bonus issue (See Note 2.12,
Equity, Item 18 under this Annual Report on Form 20-F for additional information). See Note 2.16, Income Taxes, under Item 18 of
this Annual Report on Form 20-F for reconciliation of the income tax provision to the amount computed by applying the statutory
income tax rate to the income before income taxes.



The following table sets forth our income
tax expense and effective tax rate for fiscal 2015 and fiscal 2014:

(Dollars
in millions)

|                   | Fiscal 2015 | Fiscal 2014 | Change | Percentage Change
|------------------ | ----------- | ----------- | ------ | -----------------
|Income tax expense | 805         | 668         | 137    | 20.5%            
|Effective tax rate | 28.6%       | 27.6%       |        |                  



Our effective tax rate for the fiscal
2015 was 28.6% compared to 27.6% for fiscal 2014. Effective tax rate is generally influenced by various factors including non-deductible
expenses, exempt non-operating income, overseas taxes, benefits from SEZ units and other tax deductions. The increase in the effective
tax rate to 28.6% for the fiscal 2015 compared to fiscal 2014, was mainly due to an increase in overseas taxes, decrease in benefits
from SEZ units as a percentage of profit before income taxes, partially offset by increase in tax reversals (net) and decrease
in non-deductible expenses. The tax reversals (net) comprise of reversal of provisions of $101 million made in earlier periods
which is partially offset by an additional tax provision of $75 million pertaining to prior periods. The reversal of the provision
is due to adjudication of a disputed matter in favor of the company and the creation of additional tax provisions for prior years
is based on tax assessments made during the year by tax authorities. (Refer to Note 2.16 of Item 18 of this Annual report for a
reconciliation of the income tax provision to the amount computed by applying the statutory income tax rate to the income before
income taxes).



Net profit



The following table sets forth our net
profit for fiscal 2015 and fiscal 2014:

(Dollars in millions)

|                            | Fiscal 2015 | Fiscal 2014 | Change | Percentage Change
|--------------------------- | ----------- | ----------- | ------ | -----------------
|Net profit                  | 2,013       | 1,751       | 262    | 15.0%            
|As a percentage of revenues | 23.1%       | 21.2%       |        |                  



The increase in net profit as a percentage
of revenues for fiscal 2015 as compared to fiscal 2014 was primarily attributable to a 1.9% increase in operating profit as a percentage
of revenues and increases in other income partially offset by increase in income tax expense, as explained above.



Sensitivity analysis for significant
defined benefit plans for Fiscal 2016 over Fiscal 2015



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 employee’s salary
and the tenure of employment.



The following table sets forth the defined
benefit obligation and fair value of plan assets as of March 31, 2016 and March 31, 2015:

(Dollars in millions)

|                                     | As of         
|------------------------------------ | --------------
|                                     | March 31, 2016
|Benefit obligation at the end        | 142           
|Fair Value of plan assets at the end | 143           
|Funded Status                        | 1             



See Note 2.11.1, Gratuity, under Item
18 of this Annual Report on Form 20-F for disclosures on assumptions used, basis of determination of assumptions and sensitivity
analysis for significant actuarial assumptions.



Liquidity and capital resources



In 1993, we raised approximately $4.4
million in gross aggregate proceeds from our initial public offering of equity shares in India. In 1994, we raised an additional
$7.7 million through private placements of our equity shares with foreign institutional investors, mutual funds, Indian domestic
financial institutions and corporations. On March 11, 1999, we raised $70.4 million in gross aggregate proceeds from our initial
public offering of ADSs in the United States. Our growth in recent years has been financed largely by cash generated from operations.



As of March 31, 2016, 2015 and 2014,
we had $5,804 million, $5,731 million and $5,656 million in working capital, respectively. The working capital as of March 31,
2016 includes $4,935 million in cash and cash equivalents and $11 million in available-for-sale financial assets. The working capital
as of March 31, 2015 includes $4,859 million in cash and cash equivalents, $140 million in available-for-sale financial assets.
The working capital as of March 31, 2014 includes $4,331 million in cash and cash equivalents, $367 million in available-for-sale
financial assets and $143 million in investments in certificates of deposit. We have no outstanding bank borrowings. We believe
that our working capital is sufficient to meet our current requirements. We believe that a sustained reduction in IT spending,
a longer sales cycle, or a continued economic downturn in any of the various geographic locations or business segments in which
we operate, could result in a decline in our revenue and negatively impact our liquidity and cash resources.



Our principal sources of liquidity are
cash and cash equivalents and the cash flow that we generate from operations. Our cash and cash equivalents are comprised of 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. Cash and cash equivalents are primarily held
in Indian Rupees. These cash and cash equivalents included a restricted cash balance of $74 million, $58 million and $53 million
as of March 31, 2016, 2015 and 2014, respectively. These restrictions are primarily on account of balances held in unpaid dividend
bank accounts, bank balances held as margin money deposit and cash balances held by irrevocable trusts controlled by us. Our investments
in available for sale financial assets comprising mutual fund units and quoted debt securities represent funds deposited at a bank
or other eligible financial institution for a specified time period and are also high credit-rated by domestic credit rating agencies.





The following table sets forth our cash
flows for fiscal 2016, 2015 and 2014:

(Dollars in
millions)

|                                          | Fiscal 2016 | Fiscal 2015 | Fiscal 2014
|----------------------------------------- | ----------- | ----------- | -----------
|Net cash provided by operating activities | 1,862       | 1,756       | 2,003      
|Net cash (used) in investing activities   | (474)       | (205)       | (823)      
|Net cash (used) in financing activities   | (1,059)     | (815)       | (519)      



Net cash provided by operations consisted
primarily of net profit adjusted for depreciation and amortization, deferred purchase price, income taxes, income on available-for-sale
financial assets and certificates of deposit, provisions for doubtful trade receivable and changes in working capital.



Trade receivables included under changes
in working capital increased by $225 million, $240 million and $232 million during fiscal 2016, 2015 and 2014, respectively. Trade
receivables as a percentage of last 12 months revenues were 18.0%, 17.8% and 16.9% as of March 31, 2016, 2015 and 2014, respectively.
Day’s sales outstanding on the basis of last 12 months revenues were 66 days, 65 days and 62 days as of March 31, 2016, 2015
and 2014, respectively.



Prepayments and other assets have
increased primarily on account of increase in withholding taxes, deferred contract cost, interest accrued, prepaid expenses
and loans advanced to employees. The interest accrued has increased on account of increase in the proportion of cumulative
fixed deposits. Deferred contract costs are upfront costs incurred for the contract and are amortized over the term of the
contract.





Increase in other liabilities and provisions
is primarily on account of increases in withholding taxes payable, accrued expenses, contingent consideration and accrued compensation
to employees partially offset by a decrease in liability towards acquisition of business comprising of deferred consideration towards
post acquisition employee remuneration which was settled during the year



Unearned revenues has increased primarily
on account of advance client billings on fixed-price, fixed-timeframe contracts for which related efforts had not been expended.
Unbilled revenues has increased primarily on account of increase in costs and earnings in excess of billings.



In fiscal 2016, income tax of $138 million
was paid consequent to demand from tax authorities in India for fiscal 2011 and in fiscal 2015, income tax of $286 million was
paid consequent to demand from tax authorities in India for fiscal 2010. Both these demands were towards denial of certain tax
benefits. We have filed an appeal with the Income Tax Appellate Authorities (see note 2.16, Income Taxes, under Item 18 of this
Annual Report on Form 20-F).



Based on the assumptions as of March
31, 2016, we expect to contribute $15 million to gratuity trusts during fiscal 2017 (see note 2.11.1, Gratuity, under Item 18 of
this Annual Report on Form 20-F).



Net cash used in investing
activities relating to our business acquisitions for fiscal 2016, 2015 and 2014 was $117 million, $206 million and nil,
respectively. Net cash used in investing activities, relating to acquisition of additional property, plant and equipment for
fiscal 2016, 2015 and 2014 was $413 million, $367 million and $451 million, respectively for our software Development
Centers. During fiscal 2016, we invested $3,676 million in liquid mutual funds, $22 million in deposits with corporations,
$12 million in preference securities, $3 million in other available for sale financial assets, $46 million in quoted debt
securities and redeemed liquid mutual funds of $3,795 million and $5 million of fixed maturity plan securities.
The redemption of liquid mutual funds was to lock-in interest rates on account of softening interest rates in
India. During fiscal 2015, we invested $3,901 million in liquid mutual funds, $22 million in deposits with corporations, $5
million in fixed maturity plan securities and redeemed liquid mutual funds of $4,098 million, $25 million on fixed maturity
plan securities and $135 million in certificates of deposit. During fiscal 2014, we invested $3,731 million in liquid mutual
fund units, $154 million in quoted debt securities, $37 million in deposits with corporations, $24 million in fixed maturity
plan securities, $210 million in certificate of deposits and redeemed liquid mutual funds of $3,681 million and $74 million
of certificates of deposit. The proceeds realized from the redemption of available-for-sale financial assets were used in our
business activities.



On October 22, 2012, we acquired 100%
of the voting interests in Lodestone Holding AG, a global management consultancy firm headquartered in Zurich, Switzerland. The
business acquisition was conducted by entering into a share purchase agreement for cash consideration of $219 million and additional
consideration of up to $112 million, which we refer to as deferred purchase price, payable to the selling shareholders of Lodestone
Holding AG who are continuously employed or otherwise engaged by us or our subsidiaries during the three year period following
the date of the acquisition. In fiscal 2016, the liability towards post acquisition employee remuneration expense was settled.



On March 5, 2015, Infosys
acquired 100% of the voting interests in Panaya Inc. (Panaya), a Delaware Corporation in the United States. Panaya is a leading
provider of automation technology for large scale enterprise and software management. The business acquisition was conducted by
entering into a share purchase agreement for a cash consideration of $225 million.



During
the year ended March 31, 2015, the group acquired 20% of the equity interests in DWA Nova LLC for a cash consideration of $15 million.
The Company has made this investment to form a new company along with Dream Works Animation (DWA). The new company, DWA Nova LLC,
will develop and commercialize image generation technology in order to provide end-to-end digital manufacturing capabilities for
companies involved in the design, manufacturing, marketing or distribution of physical consumer products. As
of March 31, 2016, Infosys Nova holds 16% of the equity interest in DWA Nova LLC.



On June 2, 2015, Infosys acquired 100%
of the voting interests in Kallidus Inc. U.S (Kallidus), a leading provider of digital experience solutions, including mobile commerce
and in-store shopping experiences to large retail clients and 100% of the voting interests of Skava Systems Private Limited, India,
an affiliate of Kallidus. The business acquisition was conducted by entering into a share purchase agreement for a cash consideration
of $91 million and a contingent consideration of up to $20 million. The payment of the contingent consideration to sellers of Kallidus
is dependent upon the achievement of certain financial targets by Kallidus over a period of 3 years ending on December 31, 2017



On November 16, 2015, Infosys
acquired 100% membership interest in Noah Consulting, LLC, (Noah), a leading provider of advanced information management
consulting services for oil and gas industry. The business acquisition was conducted by entering into a share purchase
agreement for a cash consideration of $33 million, a contingent consideration of up to $5 million and an additional
consideration of up to $32 million, referred to as retention bonus payable to the employees of Noah at each anniversary year
following the acquisition date the next three years, subject to their continuous employment with the group at each
anniversary. The payment of the contingent consideration to the sellers of Noah was dependent upon the achievement of certain
financial targets by Noah for the year ended December 31, 2015 and year ending December 31, 2016. During fiscal 2016, based
on an assessment of Noah achieving the targets for the year ended December 31, 2015 and year ending December 31, 2016, the
entire contingent consideration has been reversed in the statement of comprehensive income.



We have an innovation fund with an outlay of $500 million to support the creation of a global eco-system of
strategic partners.



We provide personal loans and salary advances to employees
who are not executive officers or directors.



The annual rates of interest for these
loans vary from 0% to 10%. Loans and advances aggregating $50 million, $40 million and $41 million were outstanding as of March
31, 2016, 2015 and 2014, respectively.



The timing of required repayments / recovery
of employee loans and advances outstanding as of March 31, 2016 are as detailed below:

(Dollars in millions)

|12 months ending March 31, | Repayment
|-------------------------- | ---------
|2017                       | 46       
|2018                       | 4        
|                           | 50       



Net cash used in financing activities
for fiscal 2016 was $1,059 million towards dividend payments including corporate dividend tax. Net cash used in financing activities
for fiscal 2015 was $815 million towards dividend payments including corporate dividend tax. Net cash used in financing activities
for fiscal 2014 was $519 million towards dividend payments including corporate dividend tax.



Our Board increased dividend
pay-out ratio from up to 40% to up to 50% of post-tax consolidated profits effective fiscal 2015. Our Board, in its meeting on
April 15, 2016, proposed a final dividend of 14.25 per equity share (approximately $0.22 per equity share). The proposal is subject
to the approval of shareholders at our Annual General Meeting to be held on June 18, 2016, and if approved, would result in a cash
outflow of approximately $592 million (excluding dividend paid on treasury shares), inclusive of corporate dividend tax.



As of March 31, 2016, we had contractual
commitments for capital expenditure of $224 million, as compared to $252 million and $227 million of contractual commitments as
of March 31, 2015 and 2014, respectively. These commitments include $181 million in commitments for domestic purchases as of March
31, 2016, as compared to $182 million and $129 million as of March 31, 2015 and 2014, respectively, and $43 million in overseas
commitments for hardware, supplies and services to support our operations generally as of March 31, 2016, as compared to $70 million
and $98 million as of March 31, 2015 and 2014, respectively. All our capital commitments will be financed out of cash generated
from operations. We expect our outstanding contractual commitments as of March 31, 2016 to be significantly completed in a year.



Quantitative and Qualitative Disclosures
about Market Risk



General



Market risk is attributable to all market
sensitive financial instruments including foreign currency receivables and payables. The value of a financial instrument may change
as a result of changes in the interest rates, foreign currency exchange rates, commodity prices, equity prices and other market
changes that affect market risk sensitive instruments.



Our exposure to market risk is a function
of our revenue generating activities and any future borrowing activities in foreign currency. The objective of market risk management
is to avoid excessive exposure of our earnings and equity to loss. Most of our exposure to market risk arises out of our foreign
currency trade receivables.



We have chosen alternative 1 provided
by Item 11 of Form 20-F to disclose quantitative information about market risk. All the required information under alternative
1 has been either included in components of market risk as given below or in note 2.7 under Item 18 of this Annual Report and such
information has been incorporated herein by reference.



The following table provides the cross
references to notes under Item 18 of this Annual Report which contains disclosures required under alternative 1 of Item 11 of Form
20-F.



|Sl. No. | Requirements of Alternative 1 of Item 11                                                                         | Cross reference to notes in the financial statements for instruments held for trading (Derivative financial instruments)                                                                                                                                                                                                                                                                                                                                                                                                                                     | Cross reference to notes in the financial statements for instruments other than for trading purposes (All other financial instruments)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|------- | ---------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1.      | Fair values of market risk sensitive instruments                                                                 | Table: The carrying value and fair value of financial instruments by categories under Note 2.7, Financial Instruments, of Item 18 of this Annual Report.                                                                                                                                                                                                                                                                                                                                                                                                     | Table: The carrying value and fair value of financial instruments by categories under Note 2.7, Financial Instruments, of Item 18 of this Annual Report.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|2.      | Contract terms to determine future cash flows, categorized by expected maturity terms                            | Section: Derivative Financial Instruments
        under Note 2.7, Financial Instruments, of Item 18 of this Annual Report describing the terms of forward and options contracts and
        the table depicting the relevant maturity groupings based on the remaining period as of March 31, 2016 and March 31, 2015.
        We have provided the outstanding contract amounts in Note 2.7, Financial Instruments, of Item 18 of this Annual Report, table giving
        details in respect of outstanding foreign exchange forward and option contracts. | Current Financial Assets: The expected maturity of these assets falls within one year, hence no additional disclosures are required.Non-Current Financial Assets:Prepayments and Other Assets - Primarily consist of deposit held with corporation to settle certain employee-related obligations as and when they arise during the normal course of business, rental deposits and security deposits with service providers. Consequently, the period of maturity could not be estimated. (see Note 2.4, Prepayments and Other Assets, under Item 18 of this Annual Report on Form 20-F for additional information). Hence we have not made any additional disclosures for the maturity of non-current financial assets.Financial Liabilities: Refer to Section “Liquidity Risk” under Note 2.7 of Item 18 of this Annual Report, table containing the details regarding the contractual maturities of significant financial liabilities as of March 31, 2016 and March 31, 2015.
|3.      | Contract terms to determine cash flows for each of the next five years and aggregate amount for remaining years. | Same table as above however as all our forward and option contracts mature within 12 months, we do not require further classification.                                                                                                                                                                                                                                                                                                                                                                                                                       | Refer to Section “Liquidity Risk” under Note 2.7 of Item 18 of this Annual Report, table containing the details regarding the contractual maturities of significant financial liabilities as of March 31, 2016 and March 31, 2015.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|4.      | Categorization of market risk sensitive instruments                                                              | We have categorized the forwards and option contracts based on the currency in which the forwards and option contracts were denominated in accordance with instruction to Item 11(a) 2 B (v). Refer to section entitled: Derivative Financial Instruments under Note 2.7, Financial Instruments, of Item 18 of this Annual Report; table giving details in respect of outstanding foreign exchange forward and option contracts.                                                                                                                             | We have categorized the financial assets and financial liabilities based on the currency in which the financial instruments were denominated in accordance with instruction to Item 11(a) 2 B (v). Refer to section entitled: Financial Risk Management under Note 2.7, Financial Instruments, under Item 18 of this Annual Report; table analyzing the foreign currency risk from financial instruments as of March 31, 2016 and March 31, 2015.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|5.      | Descriptions and assumptions to understand the above disclosures                                                 | All the tables given under Note 2.7, Financial Instruments, under Item 18 of this Annual Report have explanatory headings and the necessary details to understand the information contained in the tables.                                                                                                                                                                                                                                                                                                                                                   | All the tables given under Note 2.7, Financial Instruments, under Item 18 of this Annual Report have explanatory headings and the necessary details to understand the information contained in the tables.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       









Risk Management Procedures



We manage market risk through treasury
operations. Our treasury operations' objectives and policies are approved by senior management and our Audit Committee. The activities
of treasury operations include management of cash resources, implementing hedging strategies for foreign currency exposures, borrowing
strategies, if any, and ensuring compliance with market risk limits and policies.



Components of Market Risk



|(1) |  | Exchange rate risk. Our exposure to market risk arises principally from exchange
rate risk. Even though our functional currency is the Indian rupee, we generate a major portion of our revenues in foreign currencies,
particularly the U.S. dollar, the United Kingdom Pound Sterling, Euro and the Australian dollar, whereas we incur a significant
portion of our expenses in Indian rupees. The exchange rate between the Indian rupee and the U.S. dollar has changed substantially
in recent years and may fluctuate substantially in the future. Consequently, the results of our operations are adversely affected
as the Indian rupee appreciates against the U.S. dollar. For fiscal 2016, 2015 and 2014, U.S. dollar denominated revenues represented
69.9%, 68.9% and 68.8% of total revenues, respectively. For the same periods, revenues denominated in United Kingdom Pound Sterling
represented 6.6%, 5.9% and 5.9% of total revenues, revenues denominated in the Euro represented 9.3%, 10.2% and 10.3% of total
revenues while revenues denominated in the Australian dollar represented 6.9%, 7.6% and 7.9% of total revenues. Our exchange rate
risk primarily arises from our foreign currency revenues, receivables and payables.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | We use derivative financial instruments such as foreign exchange forward and option
contracts to mitigate the risk of changes in exchange rates on foreign currency exposures. The counterparty for these contracts
is a bank.
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | As of March 31, 2016, we had outstanding forward contracts of $510 million, Euro
100 million, United Kingdom Pound Sterling 65 million, Australian dollar 55 million, and Swiss Franc 25 million and outstanding
options contract of $125 million. As of March 31, 2015, we had outstanding forward contracts of $716 million, Euro 67 million,
United Kingdom Pound Sterling 73 million, Australian dollar 98 million, Canadian dollar 12 million and Singapore dollar 25 million.
As of March 31, 2014, we had outstanding forward contracts of $751 million, Euro 64 million, United Kingdom Pound Sterling 77
million and Australian dollar 75 million and option contracts of $20 million. The forward and option contracts typically mature
within 12 months, must be settled on the day of maturity and may be cancelled subject to the payment of any gains or losses in
the difference between the contract exchange rate and the market exchange rate on the date of cancellation. We use these derivative
instruments only as a hedging mechanism and not for speculative purposes. We may not purchase adequate instruments to insulate
ourselves from foreign exchange currency risks. In addition, any such instruments may not perform adequately as a hedging mechanism.
The policies of the RBI may change from time to time which may limit our ability to hedge our foreign currency exposures adequately.
We may, in the future, adopt more active hedging policies, and have done so in the past.
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(2) |  | Fair value.The fair value of our market rate risk sensitive instruments approximates
their carrying value.
|--- |  | ----------------------------------------------------------------------------------------------------------



Recent Accounting Pronouncements



IFRS 9 Financial instruments:In
July 2014, the International Accounting Standards Board issued the final version of IFRS 9, Financial Instruments. The standard
reduces the complexity of the current rules on financial instruments as mandated in IAS 39. IFRS 9 has fewer classification and
measurement categories as compared to IAS 39 and has eliminated the categories of held to maturity, available for sale and loans
and receivables. Further, it eliminates the rule-based requirement of segregating embedded derivatives and tainting rules pertaining
to held to maturity investments. For an investment in an equity instrument which is not held for trading, IFRS 9 permits an irrevocable
election, on initial recognition, on an individual share-by-share basis, to present all fair value changes from the investment
in other comprehensive income. No amount recognized in other comprehensive income would ever be reclassified to profit or loss.
It requires the entity, which chooses to measure a liability at fair value, to present the portion of the fair value change attributable
to the entity’s own credit risk in the other comprehensive income



IFRS 9 replaces the ‘incurred loss
model’ in IAS 39 with an ‘expected credit loss’ model. The measurement uses a dual measurement approach, under
which the loss allowance is measured as either 12 month expected credit losses or lifetime expected credit losses. The standard
also introduces new presentation and disclosure requirements.



The effective date for adoption
of IFRS 9 is annual periods beginning on or after January 1, 2018, though early adoption is permitted. We have elected to early
adopt the standard effective April 1, 2016 and the impact on the consolidated financial statements is not material.



IFRS
15 Revenue from Contracts with Customers: In May 2014, the International
Accounting Standards Board (IASB) issued IFRS 15, Revenue from Contract with Customers. The core principle of the new standard
is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that
reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Further the new
standard requires enhanced disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from
the entity’s contracts with customers. The standard permits the use of either the retrospective or cumulative effect transition
method. The effective date for adoption of IFRS 15 is annual periods beginning on or after January 1, 2017, though early adoption
is permitted. In September 2015, the IASB issued an amendment to IFRS 15, deferring the adoption of the standard to periods beginning
on or after January 1, 2018 instead of January 1, 2017



We are evaluating the effect of IFRS
15 on the consolidated financial statements including the transition method to be adopted and the related disclosures. We continue
to evaluate the effect of the standard on ongoing financial reporting.



IFRS 16 Leases: On January 13,
2016, the International Accounting Standards Board issued the final version of IFRS 16, Leases. IFRS 16 will replace the existing
leases Standard, IAS 17 Leases, and related Interpretations. The Standard sets out the principles for the recognition, measurement,
presentation and disclosure of leases for both parties to a contract i.e., the lessee and the lessor. IFRS 16 introduces a single
lessee accounting model and requires a lessee to recognise assets and liabilities for all leases with a term of more than 12 months,
unless the underlying asset is of low value. Currently, operating lease expenses are charged to the statement of comprehensive
income. The Standard also contains enhanced disclosure requirements for lessees. IFRS 16 substantially carries forward the lessor
accounting requirements in IAS 17.



The effective date for adoption of IFRS
16 is annual periods beginning on or after January 1, 2019, though early adoption is permitted for companies applying IFRS 15 Revenue
from Contracts with Customers. We are yet to evaluate the requirements of IFRS 16 and the impact on the consolidated financial
statements.



Critical Accounting Policies



We consider the policies discussed below
to be critical to an understanding of our financial statements as their application places the most significant demands on management's
judgment, with financial reporting results relying on estimation about the effect of matters that are inherently uncertain. Specific
risks for these critical accounting policies are described in the following paragraphs. For all of these policies, future events
rarely develop exactly as forecast, and the best estimates routinely require adjustment.



Estimates



We prepare financial statements in conformity
with IFRS, which requires us to make estimates, judgments and assumptions. These estimates, judgments and assumptions affect the
application of accounting policies and the reported amounts of assets and liabilities, the disclosures of contingent assets and
liabilities at the date of the financial statements and reported amounts of revenues and expenses during the period. Application
of accounting policies which require critical accounting estimates involving complex and subjective judgments and the use of assumptions
in the consolidated financial statements have been disclosed below. However, accounting estimates could change from period to period
and actual results could differ from those estimates. Appropriate changes in estimates are made as and when we become aware of
changes in circumstances surrounding the estimates. Changes in estimates are reflected in the period in which changes are made
and, if material, their effects are disclosed in the notes to the consolidated financial statements.



a. Revenue recognition



We use the percentage-of-completion method
in accounting for fixed-price contracts. Use of the percentage-of-completion method requires us to estimate the efforts or costs
expended to date as a proportion of the total efforts or costs to be expended. Efforts or costs expended have been used to measure
progress towards completion as there is a direct relationship between input and productivity. Provisions for estimated losses,
if any, on uncompleted contracts are recorded in the period in which such losses become probable based on the expected contract
estimates at the reporting date.



b.Income taxes



Our two major tax jurisdictions are India
and the U.S., though we also file tax returns in other foreign jurisdictions. Significant judgments are involved in determining
the provision for income taxes, including the amount expected to be paid / recovered for uncertain tax positions.



c. Business combinations and Intangible
assets



Our business combinations are accounted
for using IFRS 3 (Revised), Business Combinations. IFRS 3 requires us to fair value identifiable intangible assets and contingent
consideration to ascertain the net fair value of identifiable assets, liabilities and contingent liabilities of the acquiree. Significant
estimates are required to be made in determining the value of contingent consideration and intangible assets. These valuations
are conducted by independent valuation experts.



d. Property, plant and equipment



Property, plant and equipment represent
a significant proportion of the asset base of the Group. The charge in respect of periodic depreciation is derived after determining
an estimate of an asset’s expected useful life and the expected residual value at the end of its life. The useful lives and
residual values of Group's assets are determined by management at the time the asset is acquired and reviewed periodically, including
at each financial year end. The lives are based on historical experience with similar assets as well as anticipation of future
events, which may impact their life, such as changes in technology. Refer to note 2.5 of Item 18 of this Annual Report.



e. Impairment of Goodwill



Goodwill is tested for impairment on
an annual basis and whenever there is an indication that the recoverable amount of a cash generating unit is less than its carrying
amount, based on a number of factors including operating results, business plans, future cash flows and economic conditions. The
recoverable amount of cash generating units is determined based on higher of value-in-use and fair value less cost to sell. The
goodwill impairment test is performed at the level of the cash-generating unit or groups of cash-generating units which are benefitting
from the synergies of the acquisition and which represents the lowest level at which goodwill is monitored for internal management
purposes.



We use market related information and
estimates to determine the recoverable amount. Key assumptions on which management has based its determination of recoverable amount
include estimated long term growth rates, weighted average cost of capital and estimated operating margins. Cash flow projections
take into account past experience and represent management’s best estimate about future developments.



Revenue Recognition



We derive our revenues primarily from
software development and related services and the licensing of software products. Arrangements with customers for software development
and related services are either on a fixed-price, fixed-timeframe or on a time-and-material basis.



We recognize revenue on time-and-material contracts as the related services are performed. Revenue from the
end of the last billing to the balance sheet date is recognized as unbilled revenues. Revenue from fixed-price, fixed-timeframe
contracts, where there is no uncertainty as to measurement or collectability of consideration, is recognized as per the percentage-of-completion
method. When there is uncertainty as to measurement or ultimate collectability, revenue recognition is postponed until such uncertainty
is resolved. Efforts or costs expended have been used to measure progress towards completion as there is a direct relationship
between input and productivity. Provisions for estimated losses, if any, on uncompleted contracts are recorded in the period in
which such losses become probable based on the current contract estimates. Costs and earnings in excess of billings have been classified
as unbilled revenue while billings in excess of costs and earnings have been classified as unearned revenue.Deferred contract costs are amortized over the term of the contract. Maintenance revenue is recognized ratably
over the term of the underlying maintenance arrangement.



At the end of every reporting period, we evaluate each project for estimated revenue and estimated efforts
or costs. Any revisions or updates to existing estimates are made wherever required by obtaining approvals from officers having
the requisite authority. Management regularly reviews and evaluates the status of each contract in progress to estimate the profit
or loss. As part of the review, detailed actual efforts or costs and a realistic estimate of efforts or costs to complete all phases
of the project are compared with the details of the original estimate and the total contract price. We evaluate change orders according
to their characteristics and the circumstances in which they occur. If such change orders are considered by the parties to be a
normal element within the original scope of the contract, no change in the contract price is made. Otherwise, the adjustment to
the contract price may be routinely negotiated. Contract revenue and costs are adjusted to reflect change orders approved by the
client and us, regarding both scope and price. Changes are reflected in revenue recognition only after the change order has been
approved by both parties. The same principle is also followed for escalation clauses.



In arrangements for
software development and related services and maintenance services, we have applied the guidance in IAS 18, Revenue, by
applying the revenue recognition criteria for each separately identifiable component of a single transaction. The
arrangements generally meet the criteria for considering software development and related services as separately identifiable
components. For allocating the consideration, we have measured the revenue in respect of each separable component of a
transaction at its fair value, in accordance with principles given in IAS 18. The price that is regularly charged for an item
when sold separately is the best evidence of its fair value. In cases where we are unable to establish objective and reliable
evidence of fair value for the software development and related services, we have used a residual method to allocate the
arrangement consideration. In these cases the balance of the consideration after allocating the fair values of undelivered
components of a transaction has been allocated to the delivered components for which specific fair values do not exist.



License fee revenues have been recognized
when the general revenue recognition criteria given in IAS 18 are met. Arrangements to deliver software products generally have
three components: license, implementation and Annual Technical Services (ATS). We have applied the principles given in IAS 18 to
account for revenues from these multiple element arrangements. Objective and reliable evidence of fair value has been established
for ATS. Objective and reliable evidence of fair value is the price charged when the element is sold separately. When other services
are provided in conjunction with the licensing arrangement and objective and reliable evidence of their fair values have been established,
the revenue from such contracts are allocated to each component of the contract in a manner, whereby revenue is deferred for the
undelivered services and the residual amounts are recognized as revenue for delivered elements. In the absence of objective and
reliable evidence of fair value for implementation, the entire arrangement fee for license and implementation is recognized using
the percentage-of-completion method as the implementation is performed. Revenue from client training, support and other services
arising due to the sale of software products is recognized as the services are performed. ATS revenue is recognized ratably over
the period in which the services are rendered.



Advances received for services and products
are reported as client deposits until all conditions for revenue recognition are met.



We account for volume discounts and pricing
incentives to customers by reducing the amount of discount from the amount of revenue recognized at the time of sale. In some arrangements,
the level of discount varies with increases in the levels of revenue transactions. The discounts are passed on to the customer
either as direct payments or as a reduction of payments due from the customer. Further, we recognize discount obligations as a
reduction of revenue based on the ratable allocation of the discount to each of the underlying revenue transactions that result
in progress by the customer toward earning the discount. We recognize the liability based on an estimate of the customer's future
purchases. If it is probable that the criteria for the discount will not be met, or if the amount thereof cannot be estimated reliably,
then discount is not recognized until the payment is probable and the amount can be estimated reliably. We recognize changes in
the estimated amount of obligations for discounts in the period in which the change occurs. We present revenues net of sales and
value-added taxes in our consolidated statement of comprehensive income.



Income Tax



Our income tax expense comprises current
and deferred income tax and is recognized in net profit in the statement of comprehensive income except to the extent that it relates
to items recognized directly in equity, in which case it is recognized in equity. Current income tax for current and prior periods
is recognized at the amount expected to be paid to or recovered from the tax authorities, using the tax rates and tax laws that
have been enacted or substantively enacted by the balance sheet date. Deferred income tax assets and liabilities are recognized
for all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial
statements except when the deferred income tax arises from the initial recognition of goodwill or an asset or liability in a transaction
that is not a business combination and affects neither accounting nor taxable profit or loss at the time of the transaction. Deferred
tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax
benefit will be realized.



Deferred income tax assets and liabilities
are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date and are expected
to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect
of changes in tax rates on deferred income tax assets and liabilities is recognized as income or expense in the period that includes
the enactment or the substantive enactment date. A deferred income tax asset is recognized to the extent that it is probable that
future taxable profit will be available against which the deductible temporary differences and tax losses can be utilized. Deferred
income taxes are not provided on the undistributed earnings of subsidiaries and branches where it is expected that the earnings
of the subsidiary or branch will not be distributed in the foreseeable future. We offset current tax assets and current tax liabilities,
where we have a legally enforceable right to set off the recognized amounts and where we intend either to settle on a net basis,
or to realize the asset and settle the liability simultaneously. We offset deferred tax assets and deferred tax liabilities wherever
we have a legally enforceable right to set off current tax assets against current tax liabilities and where the deferred tax assets
and deferred tax liabilities relate to income taxes levied by the same taxation authority. Tax benefits of deductions earned on
exercise of employee share options in excess of compensation charged to income are credited to share premium.



Business Combinations, Goodwill and
Intangible Assets



Business combinations have been accounted
for using the acquisition method under the provisions of IFRS 3 (Revised), Business Combinations. The cost of an acquisition is
measured at the fair value of the assets transferred, equity instruments issued and liabilities incurred or assumed at the date
of acquisition, which is the date on which control is transferred. The cost of acquisition also includes the fair value of any
contingent consideration. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination
are measured initially at their fair value on the date of acquisition. Business combinations between entities under common control
is outside the scope of IFRS 3 (Revised), Business Combinations and is accounted for at carrying value. Transaction costs that
we incur in connection with a business combination such as finders’ fees, legal fees, due diligence fees, and other professional
and consulting fees are expensed as incurred.



Goodwill represents the cost of business
acquisition in excess of our interest in the net fair value of identifiable assets, liabilities and contingent liabilities of the
acquiree. When the net fair value of the identifiable assets, liabilities and contingent liabilities acquired exceed the cost of
the business acquisition, we recognize a gain immediately in net profit in the statement of comprehensive income. Goodwill is measured
at cost less accumulated impairment losses.



Intangible assets are stated at cost
less accumulated amortization and impairments. They are amortized over their respective individual estimated useful lives on a
straight-line basis, from the date that they are available for use. The estimated useful life of an identifiable intangible asset
is based on a number of factors including the effects of obsolescence, demand, competition, and other economic factors (such as
the stability of the industry, and known technological advances), and the level of maintenance expenditures required to obtain
the expected future cash flows from the asset. Amortization methods and useful lives are reviewed periodically including at each
financial year end.



We expense research costs as and when
the same are incurred. Software product development costs are expensed as incurred unless technical and commercial feasibility
of the project is demonstrated, future economic benefits are probable, we have the intention and ability to complete and use or
sell the software and the costs can be measured reliably. The costs which can be capitalized include the cost of material, direct
labour, overhead costs that are directly attributable to preparing the asset for its intended use. Research and development costs
and software development costs incurred under contractual arrangements with customers are accounted as cost of sales.



OFF - BALANCE SHEET ARRANGEMENTS



None.



CONTRACTUAL OBLIGATIONS



Set forth below are our outstanding contractual
obligations as of March 31, 2016.

(Dollars in millions)

|Contractual obligations              | Total | Less than 1 year | 1-3 years | 3-5 years | More than 5 years
|------------------------------------ | ----- | ---------------- | --------- | --------- | -----------------
|Operating lease obligations          | 255   | 56               | 82        | 50        | 67               
|Purchase obligations                 | 411   | 379              | 26        | 5         | 1                
|Unrecognized tax benefits            | 443   | –                | –         | –         | –                
|Post-retirement benefits obligations | 257   | 22               | 46        | 52        | 137              



We have various operating leases, mainly
for office buildings, that are renewable on a periodic basis. A majority of our operating lease arrangements extend up to a maximum
of ten years from their respective dates of inception, and relate to rented overseas premises.



Purchase
obligation means an agreement to purchase goods or services that are enforceable and legally binding on the Company that specifies
all significant terms, including fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and
the approximate timing of the transaction. Purchase obligations include capital commitments.



Unrecognized tax benefits relate to liability
towards uncertain tax positions taken in major tax jurisdictions. The period in which these uncertain tax positions will be settled
is not practically determinable.



Post-retirement benefits obligations
are the benefit payments, which are expected to be paid under our gratuity plans.



Item 6. Directors, Senior Management
and Employees



DIRECTORS AND EXECUTIVE OFFICERS



Set forth below are the respective ages
and positions of our directors and executive officers as of the date of this Annual Report on Form 20-F.



|Dr. Vishal Sikka(1)        | 48 | Chief Executive Officer and Managing Director                         
|-------------------------- | -- | ----------------------------------------------------------------------
|U. B. Pravin Rao           | 54 | Chief Operating Officer and Whole-time Director                       
|M. D. Ranganath (2)        | 54 | Chief Financial Officer and Executive Vice President                  
|David D. Kennedy           | 54 | Executive Vice President, General Counsel and Chief Compliance Officer
|Kiran Mazumdar-Shaw        | 63 | Independent Director                                                  
|Ravi Venkatesan            | 53 | Independent Director                                                  
|Prof. Jeffrey S. Lehman(3) | 59 | Independent Director                                                  
|R. Seshasayee              | 67 | Non-Executive Chairman and Independent Director                       
|Prof. John W. Etchemendy   | 63 | Independent Director                                                  
|Roopa Kudva                | 52 | Independent Director                                                  
|Dr. Punita Kumar-Sinha(4)  | 53 | Independent Director                                                  





|(1) | Appointed as Chief Executive Officer and Managing Director with effect from June 14, 2014. Reappointment approved
by the shareholders by way of postal ballot on March 31, 2016, effective from April 1, 2016. | 
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|(2) | Appointed as Chief Financial Officer effective October 12, 2015.                                                                                                                                              
|(3) | Appointed as member of the Board with effect from April 14, 2006. Reappointment approved by the shareholders
by way of postal ballot on March 31, 2016, effective April 14, 2016.                             
|(4) | Appointed as a Member of the Board with effect from January 14, 2016. Appointment confirmed by the shareholders
by way of postal ballot on March 31, 2016.                                                    





The following are the details of membership
and chairmanship in Board committees :



|                             | Committees of the Board of Directors as on March 31, 2016
|---------------------------- | ---------------------------------------------------------
|Name                         | Board                                                    
|Prof. Jeffrey S. Lehman      | ●                                                        
|Ravi Venkatesan              | ●                                                        
|R Seshasayee                 | Chairman                                                 
|Roopa Kudva                  | ●                                                        
|Kiran Mazumdar-
        Shaw | ●                                                        
|Prof. John W. Etchemendy     | ●                                                        
|Dr. Punita Kumar-Sinha       | ●                                                        
|Dr. Vishal Sikka             | ●                                                        
|U B Pravin Rao               | ●                                                        



● Member of the Committee.





Size and
composition of the Board



We believe that
our Board needs to have an appropriate mix of executive and independent directors to maintain its independence, and separate its
functions of governance and management. Securities Exchange Board of India (SEBI) Listing regulations mandates that for a company
with a non-executive Chairman, at least one-third of the board should be independent directors. As of March 31, 2016, our Board
consists of nine members, two of whom are executive or whole-time directors, while the remaining seven are independent directors.
Three out of nine Board members are women. Five of our Board members are Indians, while four are foreign nationals. The Board periodically
evaluates the need for change in its composition and size.



Definition
of Independent Directors



The
Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 define an
‘independent director’ as a person who is not a promoter or employee or one of the key managerial personnel of
the company or its subsidiaries. They also state that the person should not have a material pecuniary relationship or
transactions with the company or its subsidiaries, apart from receiving remuneration as an independent director. We abide by
the above mentioned definitions of an independent Director in addition to definition of an independent director as laid down
in the NYSE rules and the Sarbanes-Oxley Act, 2002 since we are listed on NYSE in the U.S.



Board membership
criteria



The
Nomination and Remuneration Committee works with the entire Board to determine the appropriate characteristics, skills and
experience required for the Board as a whole and for individual members. Board members are expected to possess the required
qualifications, integrity, expertise and experience for the position. They should also possess deep expertise and insights in
sectors / areas relevant to the Company,

and ability to contribute to the Company’s growth.





Age
limit for Managing Director / Executive Director: 60 years



Age
limit for Independent Director: 70 years



The
term of the persons holding these positions may be extendedat
the discretion of the committee beyond the age of 60 or 70 yearswith shareholder approval by passing
a special resolution based onthe explanatory statement annexed
to the notice for such motionindicating the justification for
extension of appointment beyond 60 or 70 years as the case may be.



Board
members are expected to rigorously prepare for, attendand participate
in all Board andapplicable committee meetings.Each
member is expected to ensure that their other current andplanned
future commitments do notmaterially interfere with theirresponsibilities
with us.



Dr.
Vishal Sikka is Chief Executive Officer & Managing Director of Infosys. Dr. Sikka is Executive Officer Infosys Nova Holdings
LLC and he is also a member of our CSR Committee. Dr. Sikka joined Infosys in 2014 to help transform the company during a time
of significant change in the services industry. Since joining Infosys, Dr. Sikka has implemented a strategy of helping clients
renew their existing IT landscapes, and at the same time bring breakthrough innovation non-disruptively. In addition, Dr. Sikka
has created a strong focus on learning and education within Infosys and with clients. Prior to joining Infosys, Dr. Sikka was a
member of the Executive Board of SAP SE, leading all products and technologies, including all of product development, and driving
innovation globally. Dr. Sikka is the creator of ‘timeless software,’ a framework which articulates the principles
of renewing existing processes and landscapes without disruption to customer environments. He is especially known for his championship
of technology as an amplifier of human potential and his passion for applying software in purposeful ways to address some of the
biggest global challenges. Dr. Sikka received his BS in Computer Science from Syracuse University. He holds a Ph.D. in Computer
Science from Stanford University.

U. B. Pravin Raois the Chief Operating Officer of Infosys and Whole-time Director of the Board. As the Chief Operating Officer,
Mr. Pravin Rao is responsible for driving growth and differentiation across portfolios at Infosys. Additionally, he oversees global
delivery, quality and productivity, the supply chain, business enabler functions. He is also the Chairman of Infosys BPO, Chairman
of Infosys Technologies (Australia) Pty. Limited and the director of Infosys Consulting Holding AG (formerly Lodestone Holding
AG). Mr, Pravin Rao has over 28 years of experience. Since joining Infosys in 1986, he has held a number of senior leadership roles
such as Head of Infrastructure Management Services, Delivery Head for Europe, and Head of Retail, Consumer Packaged Goods, Logistics
and Life Sciences. Mr. Pravin Rao holds a degree in electrical engineering from Bangalore University, India.



M.
D. Ranganathis the Chief Financial Officer of Infosys. His responsibilities include corporate finance, mergers and acquisitions,
corporate planning, risk management and investor relations. He has over 24 years of experience in IT and financial services industries.
He has held several leadership positions during a tenure of over 15 years with Infosys. Till recently, as Executive Vice Presidentof Strategic Operations, he was
responsible for strategic planning, risk management, mergers & acquisitions and corporate marketing. Earlier, he led the cost
optimization initiative of the company as part of the Chairman’s Office. From January 2008 to July 2013, he was the Chief
Risk Officer and worked with the Board’s Risk Management and Audit committees to enable the Board’s overview of risk
management and governance. Prior to this, Mr. Ranganath was Head of the Domain Competency Group, where he led a group of industry
consultants and worked with global financial services clients. From 1991 to 1999, Mr. Ranganath worked with ICICI Limited, where
he held leadership responsibilities in Treasury, Planning and credit functions. He has a post graduate diploma in management (PGDM)
from the Indian Institute of Management, Ahmedabad, a master's degree in technology from the Indian Institute of Technology, Madras
and Bachelor’s degree in engineering from the University of Mysore. He is an Associate Member of CPA, Australia.



David
D. Kennedyis Executive Vice President, General Counsel and Chief Compliance Officer of Infosys. He is responsible for
all legal and compliance matters of the company. He is the Vice President of Infosys Nova Holdings LLC, he is also a director
in Infosys Technologies (China) Company Limited and Infosys Technologies (Shanghai) Company Limited. He has offered legal guidance
to international companies for over 25 years. Prior to Infosys, he was Chief Legal Officer at JDA Software, Inc., General Counsel
and Corporate Secretary at Better Place, Inc., and General Counsel and Secretary for Business Objects S.A. He began his professional
career with IBM and held various legal leadership roles within a number of business units. He holds a Bachelor of Science degree
in Business Administration from the University Of Connecticut School Of Business Administration and a J.D. from the University
Of Connecticut School Of Law.



Kiran
Mazumdar-Shawis
an Independent Director of Infosys. She has served as one of the directors on our Board since January 2014. She is the
Chairperson & Managing Director of Biocon Limited, a biotechnology company based in Bangalore, India. She is a member of
our Nomination and Remuneration Committee, CSR Committee, Risk and Strategy Committee and Finance and Investment Committee.
Ms. Shaw is highly respected in the corporate world and has been named among TIME magazine’s 100 most influential
people in the world. The Economic Times placed her at India Inc.’s top 10 most powerful women CEO for the year 2012.
Her pioneering efforts in biotechnology have drawn global recognition both for Indian Industry and Biocon. Ms. Shaw received
a graduate honors degree in Zoology from Bangalore University (1973) and qualified as a Master Brewer from Ballarat
University, Australia (1975). Ms. Shaw has also received many honorary Doctorates in recognition of her pre-eminent
contributions to the field of biotechnology.



Ravi
Venkatesanis an Independent Director of Infosys. He has served as one of the directors on our Board since April
2011. He is also the Chairperson of our Risk and Strategy Committee and a member of our Stakeholders Relationship Committee,
Audit Committee and Finance and Investment Committee. Mr. Venkatesan is the Chairman of the Bank of Baroda and was previously
the Chairman of Microsoft India. Mr. Venkatesan is also a trustee of Rockefeller Foundation and Chairman of Social Venture
Partners India. He is the author of "Conquering the Chaos: Win in India, Win Everywhere" published by Harvard
Business Review. Mr. Venkatesan received a Bachelor of technology in mechanical engineering from the Indian Institute of
Technology, Bombay, a Master of Science in Industrial Engineering from Purdue University and a Master of Business
Administration from Harvard University, where he was a Baker Scholar. He was voted as one of India's best management thinkers
by Thinkers50.





Prof.
Jeffrey S. Lehman is an Independent Director of Infosys. He has served as one of the directors on our Board since
April 2006. Mr. Lehman is the Chairperson of our Nomination and Remuneration Committee and Stakeholders Relationship Committee
and a member of our Audit Committee. He also serves as the Chairman of Infosys Public Services, Inc. For the past four years, Mr.
Lehman has been Vice Chancellor of NYU Shanghai.  He has previously served as the founding dean of the Peking University School
of Transnational Law, the president at Cornell University, and the dean of the University of Michigan Law School. Mr. Lehman received
a Bachelor of Arts in Mathematics from Cornell University and Master of Public Policy and Juris Doctor degrees from the University
of Michigan.



R.
Seshasayee is the Non-Executive Chairman at Infosys. He has served as one of the directors on ourBoard
since January 2011. He is the Chairperson of CSR Committee, a member of Audit Committee and a member of our Risk and Strategy Committee
and Nomination and Remuneration Committee. He joined Ashok Leyland Ltd. in 1976 and was appointed as Executive Director in 1983,
Deputy Managing Director in 1993 and elevated as Managing Director in April 1998. Currently, Mr. Seshasayee is the Non-Executive
Vice Chairman of Ashok Leyland Limited. Recognizing his contribution towards the enhancement of economic and social ties between
Italy and India, Mr. Seshasayee was accorded the 'Star of Italian Solidarity' award by the Italian Government. In 2008, he was
awarded the prestigious Sir Jehangir Ghandy Medal for Industrial and Social Peace by XLRI, Jamshedpur. In the same year, he was
conferred the 'Lifetime Achievement Award, by the Institute of Chartered Accountants of India.



Prof. John
W. Etchemendyis an Independent Director of Infosys. He has served as one of the directors on our Board since December
2014. He is member of Risk and Strategy Committee, Stakeholders Relationship Committee, Nomination and Remuneration Committee and
Financeand Investment Committee.
Heis the Provost of Stanford University, a position he has held for 16 years,
and holds the Patrick Suppes Family Professorship in the School of Humanities and Sciences. He is also a faculty member in the
Symbolic Systems Program and a senior researcher at the Center for the Study of Language and Information (CSLI). He has received
several teaching awards at Stanford and is the recipient of the Educom Medal for leadership in the application of technology to
teaching. He received his B.A. and M.A. in Philosophy from the University of Nevada, Reno. He earned his doctorate in Philosophy
at Stanford University. He served on the faculty at Princeton University for two years before joining Stanford's faculty in 1983.
He is the author of numerous books and articles on logic, some co-authored with close collaborators. He has been co-editor of the
Journal of Symbolic Logic and on the editorial board of several other journals.



Roopa Kudvais an Independent
Director of Infosys. She has served as one of the directors on our Board since February 2015.Roopa Kudva is Managing
Director of Omidyar Network India Advisors and Omidyar Network partner. Omidyar Network is a US-based philanthropic investment
firm. She was the Managing Director and Chief Executive Officer of CRISIL, a global analytical company providing ratings, research,
and risk and policy advisory services. She is the Chairperson of Audit Committee and Finance and Investment Committee, as a member
of Risk and Strategy Committee. She regularly features in lists of the most powerful women in business compiled by prominent publications,
including Fortune and Business Today. She is a recipient of several prestigious awards including the ‘Outstanding Woman Business
Leader of The Year’ at CNBC TV18’s ‘India Business Leader Awards 2012’, India Today ‘Corporate Woman
Award 2014’ and Indian Merchants’ Chamber Ladies' Wing’s ‘Woman of the Year’ Award 2013-14. She is
a member of several policy-level committees relating to the Indian financial system, including committees of the Securities and
Exchange Board of India and the RBI. She has also been a member of the Executive Council of NASSCOM. She is a regular speaker at
global conferences and seminars by multilateral agencies, market participants, and leading academic institutions. She holds a postgraduate
diploma in management from Indian Institute of Management, Ahmedabad (IIM-A) and also received the ‘Distinguished Alumnus
Award’ from her alma mater.





Dr. Punita
Kumar-Sinha is an Independent Director of Infosys. She has served as one of the directors on our Board since January
2016. Dr. Punita Kumar-Sinha has focused on investment management and financial markets during her 27-year career. She
spearheaded some of the first foreign investments into the Indian equity markets in the early 1990s. Currently, she is the
Founder and Managing Partner, Pacific Paradigm Advisors, an independent investment advisory and management firm focused on
Asia. Dr. Kumar-Sinha is also a Senior Advisor and serves as an independent director for several companies. Prior to founding
Pacific Paradigm Advisors, she was a Senior Managing Director of Blackstone and the Chief Investment Officer of Blackstone
Asia Advisors. Dr Kumar-Sinha was also the Senior Portfolio Manager and CIO for The India Fund (NYSE:IFN), the largest India
Fund in the US, for almost 15 years, The Asia Tigers Fund (NYSE:GRR), and The Asia Opportunities Fund. At Blackstone Asia
Advisors, Dr. Kumar-Sinha led the business and managed teams in US, India, and Hong Kong. Prior to joining Blackstone, Dr.
Kumar-Sinha was a Managing Director and Senior Portfolio Manager at Oppenheimer Asset Management Inc., and CIBC World
Markets, where she helped open one of the first India advisory offices for a foreign firm. She also worked at Batterymarch (a
Legg Mason company), Standish Ayer & Wood (a BNY Mellon company), JP Morgan and IFC / World Bank. Dr. Kumar-Sinha has
been frequently featured in the media. She has been a speaker at many forums and many of her contributions at seminars and
conferences have projected the potential and prospects of Asia as an investment destination. Dr. Kumar-Sinha has a Ph.D. and
a Masters in Finance from the Wharton School, University of Pennsylvania. She received her undergraduate degree in chemical
engineering with distinction from the Indian Institute of Technology, New Delhi. She has an MBA and is also a CFA
Charter holder. Dr. Kumar-Sinha is a member of the CFA Institute and the Council on Foreign Relations. She is a Charter
Member and was a Board Member of TIE-Boston. Dr. Kumar-Sinha has been awarded the Distinguished Alumni Award from IIT
Delhi.





COMPENSATION



Our Nomination and Remuneration
Committee determines and recommends to the Board the compensation payable to the directors. All Board-level compensation is
based on the approval obtained from shareholders. The annual compensation of the executive directors is approved by the
Nomination and Remuneration Committee, within the parameters set by the shareholders at the shareholders meetings.
Remuneration of the executive directors consists of a fixed component and a variable pay. The Nomination and Remuneration
Committee makes a half-yearly appraisal of the performance of the executive directors based on a detailed performance-related
matrix.



We have a variable compensation structure
for our employees above a certain level of seniority. The variable compensation is payable based on performance. Our Board aligned
the compensation structure of our executive directors in line with that applicable to all of our other employees. Our executive
directors have variable compensation payable on our achievement of certain performance targets. The variable compensation is payable
quarterly or at other intervals as may be decided by our Board.



In fiscal 2016, we paid independent directors an aggregate of $1,395,402.Directors are also reimbursed for certain expenses in connection
with their attendance at Board and committee meetings. Executive directors do not receive any additional compensation for their
service on the Board.



We operate in numerous countries and
compensation for our officers and employees may vary significantly from country to country. As a general matter, we seek to pay
competitive salaries in all the countries in which we operate.





The table below describes the compensation for our officers
and directors, for fiscal 2016.



|Name                       | Salary ($) | Bonus & Incentive ($) | Other Annual Compensation / Commission ($) | Amount accrued for long term benefits ($)
|-------------------------- | ---------- | --------------------- | ------------------------------------------ | -----------------------------------------
|Dr. Vishal Sikka(3)        | 906,923    | (1)(2)6,488,727       | –                                          | 51,198                                   
|U. B. Pravin Rao           | 135,313    | 849,677               | 387,287                                    | 24,269                                   
|K. V. Kamath(4)            | –          | –                     | 58,709                                     | –                                        
|Ravi Venkatesan            | –          | –                     | 157,500                                    | –                                        
|Prof. Jeffrey S. Lehman(5) | –          | –                     | 300,875                                    | –                                        
|R. Seshasayee(6)           | –          | –                     | 277,111                                    | –                                        
|Kiran Mazumdar-Shaw        | –          | –                     | 131,250                                    | –                                        
|Carol M Browner(7)         | –          | –                     | 102,441                                    | –                                        
|Roopa Kudva                | –          | –                     | 179,407                                    | –                                        
|Prof. John W. Etchemendy   | –          | –                     | 158,000                                    | –                                        
|Dr. Punita Kumar- Sinha(8) | –          | –                     | 30,109                                     | –                                        
|Rajiv Bansal(9)            | 84,937     | 639,393               | 2,698,415                                  | 15,102                                   
|M. D. Ranganath(10)        | 260,865    | 265,252               | –                                          | 13,024                                   
|David D. Kennedy           | 470,510    | 658,619               | –                                          | 20,439                                   





|(1)  | Includes provision for variable pay amounting to $4.33 million for fiscal 2016. The shareholders in the EGM dated July 30, 2014 had approved a variable pay of $4.18 million at a target level and also authorized the Board to alter and vary the terms of remuneration. Accordingly, based on the recommendations of the Nomination and Remuneration committee, the Board approved on April 15, 2016, $4.33 million as variable pay for fiscal 2016.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2)  | Includes
    payment of variable pay amounting to $2.1 million for fiscal 2015 as decided by the Nomination and Remuneration Committee on
    June 22, 2015 in line with the compensation plan approved by the shareholders.                                                                                                                                                                                                                          
|(3)  | Additionally during fiscal 2016, Dr. Vishal Sikka was granted RSUs valued at $2 million on the grant date, exercisable at par value of equity shares.                                                                                                                                                                                                                                                                                                 
|(4)  | Ceased to be a member of the Board effective June 5, 2015.                                                                                                                                                                                                                                                                                                                                                                                            
|(5)  | Appointed as a Member of the Board with effect from April 14, 2006. Reappointment approved by the shareholders by way of postal ballot on March 31, 2016, effective April 14, 2016.                                                                                                                                                                                                                                                                   
|(6)  | Appointed as Non-Executive Chairman of the Board effective June 5, 2015.                                                                                                                                                                                                                                                                                                                                                                              
|(7)  | Ceased to be a member of the Board effective November 23, 2015.                                                                                                                                                                                                                                                                                                                                                                                       
|(8)  | Appointed as a Member of the Board effective January 14, 2016. Appointment approved by the shareholders by way of postal ballot on March 31, 2016.                                                                                                                                                                                                                                                                                                    
|(9)  | Ceased to be a Chief Financial officer effective October 12, 2015. Refer to note 2.18, Related Party Transactions, under Item 18 of this Annual Report.                                                                                                                                                                                                                                                                                               
|(10) | Appointed
as Chief Financial officer effective October 12, 2015.                                                                                                                                                                                                                                                                                                                                                                                      





All compensation to directors and officers disclosed in the
table above that was paid in various currencies have been converted, for the purposes of the presentation in such table, at quarterly
average exchange rates.



EquityGrants



In fiscal 2015, on recommendation of
the Nomination and Remuneration Committee, we made a grant of 27,067 RSUs (the equivalent of 108,268 RSUs after adjustment for
the bonus issues) to Dr. Vishal Sikka, CEO and MD. These RSUs will vest over a period of four years from the date of the grant
in the proportions specified in the award agreement. Further in fiscal 2016, based on the recommendation of the Nomination and
Remuneration Committee, we made a grant of 124,061 RSUs to Dr. Vishal Sikka. These RSUs will vest over a period of four years from
the date of the grant in the proportions specified in the award agreement. For additional information on the RSU’s granted
to the CEO (See note 2.15 under Item 18 of this Annual Report).



Option Exercises and Holdings



None of the directors or senior executives, except Dr. Vishal Sikka, held or exercised any options during
the fiscal 2016. During fiscal 2016, Dr. Vishal Sikka exercised 10,824 options and held 221,505 options outstanding as of March
31, 2016.



The Indian Companies Act, 2013 only mandates
executive directors to retire by rotation. Independent Directors shall hold office for a term up to five consecutive years on the
board of the Company and will be eligible for re-appointment on passing of a special resolution by the Company. The term of office
of each of the directors is given below:



|Name                       | Date when Current Term of Office Began(1) | Expiration / Renewal Date of Current Term of Office (2) | Whether Term of Office is subject to retirement by rotation
|-------------------------- | ----------------------------------------- | ------------------------------------------------------- | -----------------------------------------------------------
|Ravi Venkatesan            | April 1, 2014                             | March 31, 2019                                          | –                                                          
|Prof. Jeffrey S. Lehman(4) | April 14, 2016                            | April 13, 2018                                          | –                                                          
|R. Seshasayee(3)           | April 1, 2014                             | May 31, 2018                                            | –                                                          
|U. B. Pravin Rao           | January 10, 2014                          | January 9, 2019                                         | Yes                                                        
|Kiran Mazumdar-Shaw        | January 10, 2014                          | March 31, 2019                                          | –                                                          
|Dr. Vishal Sikka(5)        | June 14, 2014                             | March 31, 2021                                          | Yes                                                        
|Prof. John W. Etchemendy   | December 4, 2014                          | December 3, 2019                                        | –                                                          
|Roopa Kudva                | February 4, 2015                          | February 3, 2020                                        | –                                                          
|Dr. Punita Kumar-Sinha(6)  | January 14, 2016                          | January 13,2021                                         | –                                                          



|(1) | For executive directors, this date is the date such director was appointed as an executive director. For non-executive directors, this date is the date such director was appointed / re-appointed as a director not liable to retire by rotation.                                                                                                   
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | For executive directors, this date is the date when such director’s current term of appointment as an executive director expires.                                                                                                                                                                                                                    
|(3) | Appointed as Non-Executive Chairman of the Board effective June 5, 2015.                                                                                                                                                                                                                                                                             
|(4) | Appointed as a Member of the Board with effect from April 14, 2006. Reappointment approved by the shareholders by way of postal ballot on March 31, 2016, effective April 14, 2016.                                                                                                                                                                  
|(5) | Appointed as
    Chief Executive Officer and Managing Director with effect from June 14, 2014. Reappointment approved by the shareholders by
    way of postal ballot on March 31, 2016, effective from April 1, 2016. He will retire by rotation in the ensuing Annual
    General Meeting scheduled for June 18, 2016 and will seek re-appointment.
|(6) | Appointed by the Board as additional director effective January 14, 2016 and the appointment confirmed by shareholders by way of postal ballot on March 31, 2016.                                                                                                                                                                                    



Employment and Indemnification contracts



Under the Indian Companies Act, our shareholders
must approve the salary, bonus and benefits of all executive directors at a general meeting of shareholders. We have entered into
agreements with our executive directors, Dr. Vishal Sikka, the Chief Executive Officer and Managing Director and Mr. U.B. Pravin
Rao, our Chief Operating Officer. Refer to the section titled ‘Material Contracts’ in Item 10 of this Annual Report
for the details of their contracts.



We have also entered into agreements
to indemnify our directors and officers for claims brought under U.S. laws to the fullest extent permitted by Indian law. These
agreements, among other things, indemnify our directors and officers for certain expenses, judgments, fines and settlement amounts
incurred by any such person in any action or proceeding, including any action by or in the right of Infosys, arising out of such
person's services as our director or officer. The form of the indemnification agreement for our directors and officers has been
filed previously as an exhibit to the Annual Report on Form 20-F. Other than the indemnification agreements referred to in this
paragraph, we have not entered into any agreements with our non-executive directors.



Board Composition



Our Articles of Association provide that
the minimum number of directors shall be 3 and the maximum number of directors shall be 18. As on March 31, 2016, the Board consists
of 9 members, two of whom are executive or whole-time directors, and seven are independent directors as defined by Rule 303A.02
of the Listed Company Manual of the New York Stock Exchange.



The Companies Act, 2013 require that
at least two-thirds of our executive directors be subject to retirement by rotation. One-third of these directors must retire from
office at each Annual General Meeting of the shareholders. A retiring director is eligible for re-election. Executive directors
are required to retire at age 60 in accordance with our India-based employee retirement policies.



The age of retirement for independent
directors joining the board is 70 years.



Board Leadership Structure



Non -Executive Chairman of the
Board



Our Board leadership comprises of a Chief
Executive Officer (CEO) and Managing Director (MD), Dr. Vishal Sikka and a non-executive Chairman, Mr. R Seshasayee. In the current
structure, the roles of CEO and Chairman of the Board are separated.



The Non-Executive Chairman of the Board
(the Chairman) is the leader of the Board. As Chairman, he will be responsible for fostering and promoting the integrity of the
Board while nurturing a culture where the Board works harmoniously for the long-term benefit of the Company and all its stakeholders.
The Chairman is primarily responsible for ensuring that the Board provides effective governance for the Company. In doing so, the
Chairman will preside at meetings of the Board and at meetings of the shareholders of the Company.



The Chairman will take a lead role in
managing the Board and facilitating effective communication among directors. The Chairman will be responsible for matters pertaining
to governance, including the organization and composition of the Board, the organization and conduct of Board meetings, effectiveness
of the Board, Board committees and individual directors in fulfilling their responsibilities. The Chairman will provide independent
leadership to the Board, identify guidelines for the conduct and performance of directors, oversee the management of the Board's
administrative activities such as meetings, schedules, agendas, communication and documentation.



The Chairman will actively work with
the Nomination and Remuneration Committee to plan the Board and Board committee's composition, induction of directors to the Board,
plan for director succession, participate in the Board effectiveness evaluation process and meet with individual directors to provide
constructive feedback and advice.



Chief Executive Officer and Managing
Director



The Chief Executive Officer and Managing
Director is responsible for corporate strategy, brand equity, planning, external contacts and all management matters. He is also
responsible for achieving the annual business targets and acquisitions.



Board’s Role in Risk Oversight



Our Board as a whole is responsible for
overall oversight of risk management. The Risk and Strategy committee, comprising of five independent directors, assists the Board
in fulfilling its corporate governance oversight responsibilities with regard to the identification, evaluation and mitigation
of operational, strategic and external risks. The Risk and Strategy committee reviews the risk management practices in the company.
Our senior management also provides regular reports and updates to the Risk and Strategy committee and our Board from time to time
on the enterprise risks and actions taken.



Board and Management Changes



Mr. K V Kamath, Non-Executive Chairman
resigned from the Board effective June 5, 2015. Mr. R Seshasayee, Independent Director was appointed as Non-Executive Chairman
effective June 5, 2015. Mr. Rajiv Bansal resigned as the Chief Financial Officer effective October 12, 2015 and Mr. M. D. Ranganath
was appointed as the Chief Financial Officer effective October 12, 2015. Ms. Carol M Browner, Independent Director resigned from
the Board effective November 23, 2015. Dr. Punita Kumar-Sinha was appointed as an additional (independent) Director effective January
14, 2016.





Board Committee Information



Currently, the Board has six committees:
the Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Risk and Strategy Committee and
Corporate Social Responsibility (CSR) Committee and Finance and Investment Committee. The charters governing these committees
(except Stakeholders Relationship Committee) and corporate governance guidelines are posted on our website at www.infosys.com.
All committees except the CSR Committee consist entirely of independent directors.



The Board, in consultation with the Nomination
and Remuneration Committee, is responsible for constituting, assigning, co-opting and fixing terms of service for committee members.
It delegates these powers to the nomination and remuneration committee.



The Non-Executive Chairman of the Board,
in consultation with the Company Secretary and the committee Chairperson, determines the frequency and duration of the committee
meetings. Normally, all the committees meet four times a year. Recommendations of the committees are submitted to the entire Board
for approval. The quorum for meetings is either two members or one-third of the members of the committee, whichever is higher.



Details relating to the Audit Committee,
Nomination and Remuneration Committee, Risk and Strategy Committee, Stakeholders Relationship Committee, Finance and Investment
Committee and Corporate Social Responsibility Committee of  the Board are provided below.



Audit Committee



The Audit Committee comprised of four independent directors each of whom was determined by the Board to be
an independent director under applicable NYSE rules and Rule 10A-3 under the Exchange Act as of March 31, 2016. They were:



|· | Ms. Roopa Kudva, Chairperson and Audit Committee Financial Expert
|- | -----------------------------------------------------------------



|· | Mr. R. Seshasayee,
|- | ------------------



|· | Prof. Jeffrey S. Lehman
|- | -----------------------



|· | Mr. Ravi Venkatesan
|- | -------------------



Ms. Roopa Kudva was appointed as a member
of the Audit Committee, effective April 24, 2015 and on July 21, 2015 she was appointed as Chairperson.



Mr. K V Kamath ceased to be a member
of the Committee effective June 5, 2015.



The primary objective of
Audit Committee is to monitor and provide an effective supervision of the Management’s financial reporting process, to
ensure accurate and timely disclosures, with the highest levels of transparency, integrity and quality of financial
reporting. The committee oversees the work carried out in the financial reporting process by the management, the internal
auditors and the independent auditors, and notes the processes and safeguards employed by each of them. The committee has the
ultimate authority and responsibility to select, evaluate and, where appropriate, replace the independent auditors in
accordance with the law. All possible measures must be taken by the committee to ensure the objectivity and independence of
the independent auditors.



The Audit Committee held four meetings
in person during fiscal 2016.



The Audit Committee has a charter which
has been filed previously as an exhibit to the Annual Report on Form 20-F.



See Item 18 for the report of the Audit
Committee.



Nomination and Remuneration Committee



The Nomination and Remuneration Committee comprised of four independent directors each of whom was determined
by the Board to be an independent director under applicable NYSE rules as of March 31, 2016. They were:



|· | Prof. Jeffery S Lehman, Chairperson
|- | -----------------------------------



|· | Mr. R. Seshasayee
|- | -----------------



|· | Ms. Kiran Mazumdar-Shaw
|- | -----------------------

| | · | Prof. John W Etchemendy
| | - | -----------------------



Prof. John W Etchemendy was appointed
as a member of the Committee effective from April 24, 2015



Mr. K V Kamath ceased to be a member
of the Committee effective June 5, 2015.



Ms. Carol M. Browner ceased to be a member
of the Committee effective November 23, 2015.





The purpose of the Nomination and
Remuneration Committee is to oversee nomination process for top-level management and the executive remuneration structure.
The committee identifies, screens and reviews individuals qualified to serve as Executive Directors, Non-Executive Directors
and Independent Directors consistent with criteria approved by the Board and recommends, for approval by the Board, nominees
for election at the annual meeting of shareholders. It also designs and continuously reviews the compensation program for our
CEO and MD and senior executives against the achievement of measurable performance goals, and structures senior executive
compensation to ensure it is competitive in the global markets in which we operate to attract and retain the best talent.



The committee makes recommendations to the Board on candidates for (i) nomination for election or re-election
by the shareholders; and (ii) any Board vacancies that are to be filled. It may act on its own in identifying potential candidates,
inside or outside the Company, or may act upon proposals submitted by the Chairman of the Board. The committee annually reviews
and approves for the CEO and MD, the executive directors and executive officers : (a) the annual base salary; (b) the annual incentive
bonus, including the specific goals and amount; (c) equity compensation; (d) employment agreements, severance arrangements, and
change in control agreements / provisions; and (e) any other benefits, compensation or arrangements. It reviews and discusses all
matters pertaining to candidates and evaluates the candidates in accordance with a process that it sees fit, passing on the recommendations
to the Board. The committee coordinates and oversees the annual self-evaluation of the Board and of individual directors. It also
reviews the performance of all the executive directors on a half-yearly basis or at such intervals as may be necessary on the basis
of the detailed performance parameters set for each executive director at the beginning of the year. The committee may also regularly
evaluate the usefulness of such performance parameters, and make necessary amendments.





The Nomination and Remuneration Committee
held six meetings in fiscal 2016.



The Nomination and Remuneration Committee
has adopted a charter. The charter has been filed previously as an exhibit to the Annual Report on Form 20F.



Risk and Strategy Committee



The Risk and Strategy Committee
comprised of five independent directors each of whom was determined by the Board to be an independent director under
applicable NYSE rules, as of March 31, 2016. They were:



|· | Mr. Ravi Venkatesan, Chairperson
|- | --------------------------------



|· | Mr. R. Seshasayee
|- | -----------------



|· | Ms. Kiran Mazumdar-Shaw
|- | -----------------------



|· | Prof. John W. Etchemendy
|- | ------------------------



| | · | Ms. Roopa Kudva
| | - | ---------------



Ms. Roopa Kudva was appointed as a member
of the Committee effective April 24, 2015.



Ms. Carol M. Browner ceased to be a member
of the Committee effective November 23, 2015.



The purpose of the Risk and Strategy
Committee is to assist the Board in fulfilling its corporate governance duties by overseeing responsibilities with regard to the
identification, evaluation and mitigation of operational, strategic and environmental risks. The Risk and Strategy Committee has
overall responsibility for monitoring and approving our risk policies and associated practices. The Risk and Strategy Committee
is also responsible for reviewing and approving risk disclosure statements in any public documents or disclosures.



The Risk and Strategy Committee held
four meetings during fiscal 2016.



The
Risk and Strategy Committee has adopted a charter. The charter has been filed previously asan exhibit to the Annual Report on Form 20-F.



Stakeholders Relationship Committee



The Stakeholders Relationship Committee comprised of three independent directors, each of whom was determined
by the Board to be an independent director under applicable NYSE rules as of March 31, 2016. They were:



|· | Prof. Jeffery S Lehman, Chairperson
|- | -----------------------------------



|· | Mr. Ravi Venkatesan
|- | -------------------



|· | Prof. John W Etchemendy
|- | -----------------------



R Seshasayee ceased to be a member of
the Committee effective April 24, 2015.



Prof. John W Etchemendy was appointed
as member of the Committee effective April 24, 2015.



The purpose of the Stakeholders Relationship
Committee is to review and redress shareholder grievances.



The Stakeholders Relationship Committee
held four meetings during fiscal 2016.



Corporate Social Responsibility Committee
(“CSR Committee”)



The CSR Committee comprises three members as of March 31, 2016. They are:



|· | Mr. R. Seshasayee,Chairperson
|- | -----------------------------
|· | Ms. Kiran Mazumdar-Shaw      
|· | Dr. Vishal Sikka             



|Ms.
    Carol M Browner was appointed as a member of the Committee, effective April 24, 2015 and ceased to be a member effective November 23, 2015.
|---------------------------------------------------------------------------------------------------------------------------------------------------



|Mr. K V Kamath ceased to be a member of the Committee, effective June 5, 2015.
|------------------------------------------------------------------------------



The purpose of the CSR Committee
is to formulate and monitor the CSR policy of the Company. The committee has adopted a policy that intends to:



|· | Strive for economic development that positively impacts the society at large with a minimal resource footprint
|- | --------------------------------------------------------------------------------------------------------------



|· | Be responsible for the Company’s actions and encourage a positive impact through its activities on the
environment, communities and stakeholders.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------



The CSR Committee will oversee the activities
/ functioning of Infosys Foundation in identifying the areas of CSR activities, programs and execution of initiatives as per predefined
guidelines.



Infosys Foundation guides the committee in reporting the progress
of deployed initiatives, and making appropriate disclosures (internal / external) on a periodic basis.



The CSR Committee held four meetings
during fiscal 2016.



The CSR Committee has adopted a charter.
The charter has been filed previously as an exhibit to the Annual Report on Form 20-F.



Finance and Investment Committee



The Finance and Investment Committee
comprised of four independent directors as on March 31, 2016:

| | · | Ms. Roopa Kudva, Chairperson
| | - | ----------------------------

| | · | Ms. Kiran Mazumdar-Shaw
| | - | -----------------------

| | · | Mr. Ravi Venkatesan
| | - | -------------------

| | · | Prof. John W. Etchemendy
| | - | ------------------------



The
purpose of the Finance and Investment Committee is to assist it in overseeing acquisitions and
investments made by the Company and to provide oversight on key investment policies of the Company.



The Committee shall:

| | · | Discuss, review and approve the overall acquisition
and investment strategy of the Company in terms of broad business objectives to be met, overall fund allocation and areas of focus
for investments and acquisitions;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | Consider and approve proposals for acquisitions
and investments up to certain threshold amounts of exposure as approved by the Board;
| | - | -------------------------------------------------------------------------------------------------------------------------------------

| | · | Periodically review the status of acquisitions
and investments in terms of business objectives met, status of integration of acquired companies, risk mitigation and financial
returns;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | Periodically review the treasury policy of
the Company, including investment of surplus funds and foreign currency operations;
| | - | ------------------------------------------------------------------------------------------------------------------------------

| | · | Conduct an annual self-review of its own effectiveness ; and
| | - | ------------------------------------------------------------

| | · | Update the Board on a periodic basis about the Committee’s deliberations and decisions
| | - | --------------------------------------------------------------------------------------

The Committee has direct access to, and open communications with, the senior leaders of the Company. The Committee
may also retain independent consultants on an as needed basis and determine the compensation for such consultants.

The committee held three meetings
during fiscal 2016.



The Finance and Investment Committee
has adopted a charter which is filed as an exhibit to this Annual Report on Form 20-F.



EMPLOYEES



As of March 31, 2016, we had 194,044
employees, of which 182,329 were software professionals. As of March 31, 2015, we had 176,187 employees, of which 166,046 were
software professionals. As of March 31, 2014, we employed 160,405 employees, of which 151,059 were software professionals.



As of March 31, 2016, we had 148,688
employees in India, 23,594 employees in the Americas, 10,289 employees in Europe and 11,473 employees in the Rest of the World.



We seek to attract and motivate IT professionals
by offering:



|· | an entrepreneurial environment that empowers IT professionals;
|- | --------------------------------------------------------------



|· | programs that recognize and reward performance;
|- | -----------------------------------------------



|· | challenging assignments;
|- | ------------------------



|· | constant exposure to new skills and technologies; and
|- | -----------------------------------------------------



|· | a culture that emphasizes openness, integrity and respect for the employee.
|- | ---------------------------------------------------------------------------



Some of our employees in jurisdictions
across Europe are covered by collective bargaining agreements that have been adopted
at a government level, across the information technology sector or otherwise. We believe that our management maintains good relations
with our employees, including those employees covered under collective bargaining agreements.



Recruiting



We
focus our recruiting on the top talent from engineering departments of Indian schools and rely on a rigorous selection process
involving a series of written tests and interviews to identify the best applicants. We also recruit students from campuses in
the United States, the United Kingdom, Australia and China. Our reputation as a premier employer enables us to select from a large
pool of qualified applicants. For example, during fiscal 2016, we received 1,115,745 employment applications, interviewed 121,670
applicants and extended offers of employment to 55,056 applicants. These statistics do not include our subsidiaries. We added
17,857 new employees, net of attrition during fiscal 2016.





In
fiscal 2016, we launched an innovative program named ‘Zero Bench’ to productively engage employees who are on bench
(between client engagements) to create valuable outcomes for the organization. Our employees can now leverage our training infrastructure
to upgrade their skills during their bench period and also work on short, internal projects of their choice, to gain exposure,
hone their skills, extend networks, while delivering value.



Performance
appraisals



As
part of the focus on human resource development during fiscal 2016, we introduced iCount, the renewed performance management system.
We moved away from the bell curve, to focus on individual employee contribution and continuous feedback, and built a self-serviced
platform to empower employees to design their own journey within the organization.



Education,
Training and Assessment



Competency
development of our employees continues to be a key area of strategic focus for us. In keeping with the changes in the use of technology
in education, we enhanced our technology-led training efforts in multiple areas. Our Foundation Program, an integrated-learning-platform
with teaching, hands-on, assessments of in-class training has been strengthened for enhanced learning experience. In addition,
mobile apps based “cool” learning has been used for greater participation and self-directed learning.



We
made key changes in continuing education programs to enhance relevance and effectiveness of learning. For instance, we strengthened
hands-on based assessments, and certifications which are skill-based and modular.

We
have also made significant investments in hardware and software assets to boost our infrastructure capabilities. All these changes
were incorporated to create unique experience for the learners at Infosys.

Our
focus on developing our employees and providing continuing education and training remains a key element of our strategy. We train
the new engineering graduates that join us at our Global Education Center in Mysore. With a total built-up area of 1.44 million
square feet, the Infosys Global Education Center can train approximately 14,000 employees at a time.

Our education programs are designed based on the competencies needed to service our clients and are aligned
with the specific roles of our professionals. Our training curriculum and offerings are frequently upgraded to meet our business
needs. The Design thinking training has been imparted to client teams, leadership teams, current employees and fresh recruits.The number of total participants who benefited from the Design Thinking training crossed over 80,000 as of March 31, 2016.



As
of March 31, 2016, we employed 753 full-time employees as educators, including 242 with either doctorate or master’s degree.
Our educators conduct training programs for both the new entrants and experienced employees. We also continued our engagement
with engineering colleges through our Campus Connect program and conducted faculty enablement workshops covering 1,225 faculty
members from various colleges for fiscal 2016.



The Infosys Open Source program, OSSmosis, was set up this fiscal with the objective of ‘nurturing innovation
through Open Source adoption and contribution’. Teams working on Big Data, DevOps, NoSQL Alternatives, Responsive Web Design
put forth their collective experience through case studies, current trends, reference implementations, and points of view.



Leadership
development





The vision of the Infosys Leadership
Institute (ILI) is to be recognized as a globally respected institution that is committed to developing leaders within Infosys.
The primary purpose of the institute is to develop and prepare senior leaders of the organization for current and future executive
leadership roles. ILI employs a wide range of developmental approaches including classroom training, coaching, ‘leaders
teach’ and executive education among others. Senior leaders from across Infosys and its subsidiaries are target beneficiaries
of ILI’s programs.



Compensation



Our professionals receive competitive
salaries and benefits. We have also adopted a variable compensation program which links compensation to company and individual
performance.



Visas



As of March 31, 2016, the majority of our
professionals in the United States held either H-1B visas (14,659 persons), which allow the employee to remain in the United States
for up to six years during the term of the work permit and work as long as he or she remains an employee of the sponsoring firm,
or L-1 visas (1,364 persons), which allow the employee to stay in the United States only temporarily. If employees are on L-1A
visas, they can typically stay in the United States temporarily for a maximum duration of 7 years and if they are on L-1B visas
they can stay in the United States temporarily for a maximum duration of 5 years.



SHARE OWNERSHIP



The following table sets forth as of
March 31, 2016, for each director and executive officer, the total number of equity shares, ADSs and options to purchase equity
shares and ADSs exercisable within 60 days from March 31, 2016. Beneficial ownership is determined in accordance with rules of
the Securities and Exchange Commission. All information with respect to the beneficial ownership of any principal shareholder has
been furnished by such shareholder and, unless otherwise indicated below, we believe that persons named in the table have sole
voting and sole investment power with respect to all the shares shown as beneficially owned, subject to community property laws,
where applicable. The shares beneficially owned by the directors and executive officers include the equity shares owned by their
family members to which such directors disclaim beneficial ownership.



The share numbers and percentages listed
below are based on 2,296,944,664 equity shares outstanding as of March 31, 2016. Percentage of shareholders representing less than
1% are indicated with an ‘*’.



|Name beneficially owned                      | Equity Shares beneficially owned | %
of equity Shares
|-------------------------------------------- | -------------------------------- | ------------------
|Dr. Vishal Sikka                             | 10,824                           | ‘*’               
|U.B. Pravin Rao                              | 555,520                          | ‘*’               
|Prof. Jeffrey S. Lehman                      | –                                | –                 
|R. Seshasayee                                | 248                              | ‘*’               
|Ravi Venkatesan                              | –                                | –                 
|Kiran Mazumdar-Shaw                          | 800                              | ‘*’               
|Prof. John W. Etchemendy                     | –                                | –                 
|Roopa Kudva                                  | –                                | –                 
|Dr.
    Punita Kumar-Sinha (1)               | 2,897                            | ‘*’               
|M. D. Ranganath                              | 9,256                            | ‘*’               
|David D. Kennedy                             | –                                | –                 
|Total (all directors and executive officers) | 579,545                          | ‘*’               



No material changes subsequently till
May 18, 2016.



|(1) |  | 1,520 ADSs of Infosys limited held by Dr. Punita Kumar-Sinha’s immediate family
in SEP-IRA in the United States. She also owns 1,377 ADSs through the Asia Opportunities Fund.
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





Option plans



2015 Stock Incentive Compensation
Plan (the 2015 Plan)



SEBI issued the Securities and
Exchange Board of India (Share based Employee Benefits) Regulations, 2014 (‘SEBI Regulations’) which replaced the
SEBI ESOP Guidelines, 1999. The 2011 Plan (as explained below) was required to be amended and restated in accordance with the
SEBI Regulations. Consequently, to effect this change and to further introduce stock options/ADR’s and other stock
incentives, the Company put forth the 2015 Stock Incentive Compensation Plan (the 2015 Plan) for approval to the shareholders
of the Company. Pursuant to the approval by the shareholders through postal ballot which ended on March 31, 2016 (the notice
of postal ballot was furnished on Form 6-K on March 2, 2016), the Board has been 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 24,038,883 equity shares (this includes 11,223,576 equity shares which are
currently held by the ‘Infosys Limited Employees Welfare Trust’ towards the 2011 Plan). 17,038,883 equity shares
will be issued as RSUs at par value and 7,000,000 equity shares will be issued as stock options at market price. These
instruments will vest over a period of 4 years and the Company expects to grant the instruments under the 2015 Plan over the
period of 4 to 7 years. The 2015 Plan is filed as an exhibit to this Annual Report on Form 20-F.



2011 RSU Plan (the 2011 Plan)



The Company had a 2011 RSU Plan which provided for the grant of restricted stock units (RSUs) at par value
to eligible employees of the Company. The Board recommended the establishment of the 2011 Plan to the shareholders on August 30,
2011 and the shareholders approved the recommendation of the Board on October 17, 2011 through a postal ballot. The maximum aggregate
number of shares that may be awarded under the plan was 11,334,400 (adjusted for bonus issues) and the plan was expected to continue
in effect for a term of 10 years from the date of initial grant under the plan. During fiscal 2015, the company made a grant of
108,268 restricted stock units (adjusted for bonus issues) to Dr. Vishal Sikka, Chief Executive Office and Managing Director. The
Board on recommendation of Nomination and Remuneration Committee, further granted 124,061 RSUs to Dr. Vishal Sikka in fiscal 2016.
These RSUs are vesting over a period of four years from the date of the grant in the proportions specified in the award agreement.
The RSUs will vest subject to achievement of certain key performance indicators as set forth in the award agreement for each applicable
year of the vesting tranche and continued employment through each vesting date. Further the Company has earmarked 100,000 equity
shares for welfare activities of the employees, approved by the shareholders through postal ballot which ended on March 31, 2016.
The equity shares currently held under this plan, i.e. 11,223,576 equity shares (this includes the aggregate number of equity shares
that may be awarded under the 2011 Plan as reduced by 10,824 equity shares already exercised by Dr. Vishal Sikka and 100,000 equity
shares which have been earmarked for welfare activities of the employees) have been subsumed under the 2015 Plan.





Further, the award granted to Dr. Vishal
Sikka for fiscal 2016 was modified by the Nomination and Remuneration committee on April 14, 2016. There is no modification or
change in the total number of RSUs granted or the vesting period (which is four years). The modifications relate to the criteria
of vesting for each of the years. Based on the modification, the first tranche of the RSUs will vest subject to achievement of
certain key performance indicators for fiscal 2016. Subsequent vesting of RSU's for each of the remaining years would be subject
to continued employment.



The above were the only RSUs granted
to purchase ADSs or equity shares to our executive officers and directors. The 2011 Plan has been filed previously as an exhibit
to the Annual Report on Form 20-F.



It is important to note that the structure of RSUs has been designed to comply with Indian corporate law provisions
that require the payment of at least par value for the issuance of a share. For this reason, employees who hold RSUs are required
to pay par value upon vesting and prior to the issuance of the shares.





Item 7. Major Shareholders and Related
Party Transactions



MAJOR SHAREHOLDERS



The following table sets forth as
of March 31, 2016, certain information with respect to beneficial ownership of  equity shares held by each shareholder or
group known by us to be the beneficial owner of 5% or more of our outstanding equity shares.



Beneficial ownership is determined in
accordance with rules of the Securities and Exchange Commission, which generally attribute beneficial ownership of securities to
persons who possess sole or shared voting power or investment power with respect to those securities and includes equity shares
issuable pursuant to the exercise of stock options or warrants that are immediately exercisable or exercisable within 60 days of
March 31, 2016. These shares are deemed to be outstanding and to be beneficially owned by the person holding those options or warrants
for the purpose of computing the percentage ownership of that person, but are not treated as outstanding for the purpose of computing
the percentage ownership of any other person. Unless otherwise indicated, all information with respect to the beneficial ownership
of any principal shareholder has been furnished by such shareholder and, unless otherwise indicated, we believe that persons named
in the table have sole voting and sole investment power with respect to all the equity shares shown as beneficially owned, subject
to community property laws where applicable. The shares beneficially owned by the directors and officers include equity shares
owned by their family members to which such directors and officers disclaim beneficial ownership.



|Name of the beneficial owner                          | Class of security | No. of shares beneficially held | % of class of shares | No. of shares beneficially held | % of class of shares | No. of shares beneficially held | % of class of shares
|----------------------------------------------------- | ----------------- | ------------------------------- | -------------------- | ------------------------------- | -------------------- | ------------------------------- | --------------------
|                                                      | Equity            | March 31, 2016                  | March 31, 2015       | March 31, 2014                 
|Shareholding of all directors and officers as a group |                   | 579,545                         | 0.03 (1)             | 381,952                         | 0.03(2)              | 58,816,301                      | 10.24 (3)           



No material changes subsequently till
May 18, 2016.



|(1) | Comprised of 579,545 shares owned by non-founder directors and officers. The percentage ownership of the group is calculated on a base of 2,296,944,664 equity shares which includes no options that are currently exercisable or exercisable by all optionees within 60 days of March 31, 2016.                                                                
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Comprised of 381,952 shares owned by non-founder directors and officers. The percentage ownership of the group is calculated on a base of 1,148,472,332 equity shares which includes no options that are currently exercisable or exercisable by all optionees within 60 days of March 31, 2015.                                                                
|(3) | Comprised of 881,147 shares owned by non-founder directors and officers. The percentage ownership of the group is calculated on a base of 574,236,166 equity shares which includes no options that are currently exercisable or exercisable by all optionees within 60 days of March 31, 2014. The number of shares has not been adjusted for bonus share issue.



Our ADSs are listed on the NYSE. Each ADS currently represents one equity share of par value 5/-
per share.  ADSs are registered pursuant to Section 12(b) of the Securities Exchange Act of 1934 and as of March 31, 2016
are held by 30,199 holders of record in the United States.



Our equity shares can be held by
Foreign Institutional Investors or FIIs, Foreign Portfolio Investors or FPIs and Non-Resident Indians or NRIs, who are
registered with the Securities and Exchange Board of India, or SEBI, and the RBI. As of March 31, 2016, 41.76% of our equity
shares were held by these FIIs, FPIs and NRIs, some of which may be residents or bodies corporate registered in the United
States and elsewhere. We are not aware of which FIIs, FPIs and NRIs hold our equity shares as residents or as corporate
entities registered in the United States.



Major shareholders do not have differential
voting rights with respect to the equity shares. To the best of our knowledge, we are not owned or controlled directly or indirectly
by any government, by any other corporation or by any other natural or legal person. We are not aware of any arrangement, the operation
of which may at a subsequent date result in a change in control.



RELATED PARTY TRANSACTIONS



Infosys BPO. Infosys Limited established
Infosys BPO in April 2002, under the laws of India.



As of March 31, 2016, Infosys Limited
holds 99.98% of the outstanding equity shares of Infosys BPO. As of March 31, 2016, we have invested an aggregate of $145 million
as equity capital in Infosys BPO.



During fiscal 2016, 2015 and 2014, we
engaged Infosys BPO and its subsidiaries for management services for which we have been billed $3 million, $11 million and $12
million, respectively. Further, during each of the fiscal 2016, 2015 and 2014, Infosys BPO and its subsidiaries engaged us for
certain management services for which we billed them $6 million. During fiscal 2016, 2015 and 2014, we engaged Infosys BPO and
its subsidiaries for software development services for which we have been billed $55 million, $38 million and $30 million, respectively.
Further, during fiscal 2016, 2015 and 2014, Infosys BPO and its subsidiaries engaged us for certain software development services
for which we billed them $11 million, $14 million and $12 million, respectively.



Infosys Australia. In January
2004, we acquired, for cash, 100% of the equity in Expert Information Services Pty. Limited, Australia for $14 million. The acquired
company was renamed as Infosys Technologies (Australia) Pty. Limited. As of March 31, 2016, Infosys Australia is under liquidation.



Infosys China. In October 2003,
we established a wholly-owned subsidiary, Infosys China, to expand our business operations in China. As of March 31, 2016, we have
invested an aggregate of $33 million as equity capital in Infosys China. During fiscal 2016, 2015 and 2014, we engaged Infosys
China for software development services for which we have been billed $19 million, $23 million and $37 million, respectively. Further,
during fiscal 2016, 2015 and 2014, Infosys China engaged us for certain software development services for which we billed them
$2 million, $1 million and $1 million, respectively. During fiscal 2016, we disbursed $10 million as loan to Infosys China for
expansion of business at an interest rate of 6.0% per annum. The loan is repayable within one year at the discretion of the subsidiary.
During fiscal 2016, we accrued interest on the loan of less than $1 million. The largest loan amount outstanding during fiscal
2016 was $10 million.



Infosys Mexico.In June 2007,
we established a wholly-owned subsidiary, Infosys Mexico, to expand our business operations in Latin America. As of March 31, 2016,
we have invested an aggregate of $14 million in the subsidiary. During each of the fiscal 2016, 2015 and 2014, we engaged Infosys
Mexico for software development services for which we have been billed $2 million. Further, during fiscal 2016, 2015 and 2014,
Infosys Mexico engaged us for certain software development services for which we billed them $6 million, $2 million and $1 million,
respectively.



Infosys Sweden. In March 2009,
we established a wholly-owned subsidiary, Infosys Technologies (Sweden) AB to expand our business operations in Europe. As of March
31, 2016, we have invested an aggregate of less than $1 million as equity capital in Infosys Sweden. During fiscal 2016, 2015 and
2014, we engaged Infosys Sweden for software development services for which we have been billed $12 million, $7 million and $2
million, respectively. Further, during fiscal 2016, Infosys Sweden engaged us for certain software development services for which
we billed them $4 million. During fiscal 2016, we disbursed $4 million as loan to Infosys Sweden for expansion of business at an
interest rate of 6.0% per annum. The loan is repayable anytime within four years at the discretion of the subsidiary. During fiscal
2016, we accrued interest on the loan of less than $1 million. The largest loan amount outstanding during fiscal 2016 was $4 million.



Infosys Brasil.In August 2009,
we established a wholly-owned subsidiary, Infosys Tecnologia do Brasil Ltda, to expand our operations in South America and invested
an aggregate of $6 million in the subsidiary. Subsequently we made additional investments of $16 million in the subsidiary. Further,
during fiscal 2014, we disbursed $6 million as loan to Infosys Brasil for expansion of business at an interest rate of 6.0% per
annum. The loan was repayable within one year at the discretion of the subsidiary. During each of fiscal 2015 and 2014, we accrued
interest on the loan of less than $1 million. During fiscal 2015, the outstanding loan amount was converted into share capital.
As of March 31, 2016 we have invested an aggregate of $28 million as equity capital in the subsidiary. The largest loan amount
outstanding during fiscal 2015 and 2014 was $6 million each. During fiscal 2016, 2015 and 2014, we engaged Infosys Brasil for software
development services for which we have been billed $2 million, $1 million and $1 million, respectively. Further, during each of
the fiscal 2016, 2015 and 2014, Infosys Brasil engaged us for certain software development services for which we billed them $1
million.



Infosys
Public Services. In October 2009, we incorporated a wholly-owned subsidiary, Infosys Public Services, Inc., to focus and expand
our operations in the U.S public services market and invested an aggregate of $5 million in the subsidiary. Further during fiscal
2013, we disbursed an amount of $12 million as loan to Infosys Public Services, at an interest rate of 6.0% per annum, for expansion
of business operations. The loan was repayable within one year from the date of disbursement at the discretion of the subsidiary.
The largest loan amount outstanding during fiscal 2014 was $12 million. During fiscal 2014, the outstanding loan amount was converted
into share capital. During fiscal 2014, we received interest on loan of $1 million. As of March 31, 2016 we have invested $17 million
in the subsidiary.During
fiscal 2016, 2015 and 2014, Infosys Public Services engaged us for certain software development services for which we billed them
$137 million, $120 million and $95 million, respectively. During fiscal 2016, we engaged Infosys Public Services for software development
services for which we have been billed $2 million.



Infosys Shanghai.On February
21, 2011 we incorporated a wholly-owned subsidiary, Infosys Technologies (Shanghai) Company Limited and invested $3 million in
the subsidiary. Subsequently we made additional investments of $44 million in the subsidiary. During fiscal 2016 and 2015, we have
made additional investments of $40 million and $25 million, respectively in Infosys Shanghai. As of March 31, 2016, we have invested
an aggregate of $112 million in the subsidiary.



Infosys Consulting India Limited.On February 9, 2012, Infosys Consulting India Limited filed a petition in the Honourable High Court of Karnataka for its merger
with Infosys Limited. The Hon’ble High Court of Karnataka sanctioned the scheme of amalgamation of Infosys Consulting India
Limited (ICIL) with Infosys Limited with an effective date of August 23, 2013 and an appointed date of January 12, 2012. Accordingly,
during fiscal 2014, all the assets and liabilities of ICIL were transferred to Infosys Limited on a going concern basis. As ICIL
was a wholly owned subsidiary of Infosys Limited, no shares have been allotted to the shareholders upon the scheme becoming effective.



Infosys Lodestone.On
October 22, 2012, we acquired 100% of the voting interests in Lodestone Holding. During fiscal 2013, we disbursed an amount
of $22 million as loans to Infosys Lodestone and its subsidiaries for expansion of business operations. During fiscal 2014,
the outstanding loan amount was converted into share capital. During fiscal 2015, we disbursed an amount of $11 million as
loans to Infosys Lodestone and its subsidiaries, at an interest rate of 6.0% per annum for expansion of business operations
which is repayable within one year from the date of disbursement at the discretion of the subsidiary. Of the loan outstanding
$10 million was repaid within fiscal 2015 and the balance of $1 million was repaid during fiscal 2016. During fiscal 2015 and
fiscal 2014, we received interest on loan of less than $1 million and $1 million. As of March 31, 2016 we have invested $241
million in the subsidiary. The largest loan amount outstanding during fiscal 2016, 2015 and 2014 was $1 million, $11 million
and $22 million, respectively. During fiscal 2016, 2015 and 2014, we engaged Infosys Lodestone and its subsidiaries for
software development services for which we have been billed $170 million, $134 million and $168 million, respectively. During
fiscal 2016, 2015 and 2014, Infosys Lodestone and its subsidiaries engaged us for software development services for which we
billed them $5 million, $4 million and $3 million, respectively. During fiscal 2016, Infosys Lodestone engaged us for certain
management services for which we billed them $1 million.



Infosys Americas.On June 25,
2013, we incorporated a wholly-owned subsidiary, Infosys Americas Inc., and invested less than $1 million in the subsidiary.



EdgeVerve.On February
14, 2014, we incorporated a wholly-owned subsidiary, EdgeVerve Systems Limited and invested less than $1 million in
the subsidiary. On April 15, 2014, the Board authorized the Company to execute a Business Transfer Agreement and
related documents with EdgeVerve, subject to securing the requisite approval from shareholders in the Annual General
Meeting. Subsequently, at the AGM held on June 14, 2014, the shareholders authorized the Board to enter into a Business
Transfer Agreement and related documents with EdgeVerve, with effect from July 1, 2014 or such other date as may be decided
by the Board. The Company undertook an enterprise valuation by an independent valuer and accordingly the business has
been transferred to the Company’s wholly owned subsidiary for a consideration of $70 million (421
crore) with effect from July 1, 2014 which is settled through the issue of fully paid-up equity shares of such subsidiary.
The transfer of assets and liabilities is accounted for at carrying values and does not have any impact on the consolidated
financial statements. During fiscal 2015, we have made an additional investment of $5 million in EdgeVerve. During fiscal
2015, we disbursed an amount of $5 million as loans to EdgeVerve, at an interest rate of 8.7% per annum for expansion of
business operations and $2 million was repaid in the same year and the balance of $3 million was repaid in fiscal 2016.



On April 24, 2015, the Board authorized the Company to execute a Business Transfer Agreement and related documents with EdgeVerve, a wholly owned
subsidiary, to transfer the business of Finacle and Edge Services. After the requisite approval from shareholders through postal
ballot on June 4, 2015, a Business Transfer Agreement and other related documents were executed with EdgeVerve to transfer the
business with effect from August 1, 2015. The company has undertaken an enterprise valuation by an independent valuer and accordingly
the business were transferred for a consideration of approximately $491 million and approximately $27 million for Finacle and Edge
Services, respectively. The consideration was settled through issue of 850,000,000 equity shares amounting to approximately $129
million and 254,900,000 non-convertible redeemable debentures amounting to approximately $389 million in EdgeVerve, post the requisite
approval from shareholders on December 11, 2015. The transfer of assets and liabilities is accounted for at carrying values and
does not have any impact on the consolidated financial statements. During fiscal 2016, we accrued an interest on debentures of
$9 million at an interest rate of 8.8% and the same was full received during the year. The largest debenture amount outstanding
during fiscal 2016 was $398 million. Further during fiscal 2016, we disbursed an amount of $14 million as loan to EdgeVerve at
an interest rate of 8.7% per annum and the same was fully repaid during the year. The largest loan amount outstanding during fiscal
2016, 2015 and 2014 was $17 million, $3 million, and Nil, respectively.



As of March 31, 2016, we have invested
an aggregate of $203 million in the subsidiary. During fiscal 2016, 2015, and 2014, EdgeVerve engaged us for certain management
services for which we billed them $22 million, $4 million, and Nil, respectively. During fiscal 2015, and 2014, we engaged EdgeVerve
for software development services for which we have been billed $22 million and Nil, respectively. During fiscal 2015 and 2014,
EdgeVerve engaged us for software development services for which we billed them $8 million and Nil, respectively.



Infosys Nova. On January 23,2015, a wholly owned subsidiary, Infosys Nova Holdings LLC, was incorporated and we invested $15 million.



PanayaOn March 5, 2015,
we acquired 100% of the voting interests in Panaya Inc., a Delaware Corporation in the United States. As of March 31,
2016, we have invested an aggregate of $225 million in the subsidiary. During fiscal 2016, Panaya engaged us for certain management
services for which we billed them $2 million. During fiscal 2016, we engaged Panaya for software development services for which
we have been billed $3 million.



KallidusOn June 2, 2015, we acquired
100% of the voting interests in Kallidus Inc., US and 100% of the voting interests of Skava Systems Private Limited,
an affiliate of Kallidus. As of March 31, 2016, we have invested an aggregate of $98 million in Kallidus and $9 million in Skava
Systems. During fiscal 2016, we disbursed an amount of $2 million as loans to Kallidus at an interest rate of 6.0% per annum for
expansion of business operations which is repayable within one year from the date of disbursement at the discretion of the subsidiary.
The entire loan was repaid during fiscal 2016. During fiscal 2016, we received interest on loan of less than $1 million. The largest
loan amount outstanding during fiscal 2016 was $2 million. During fiscal 2016, we engaged Kallidus for software development services
for which we have been billed $3 million.



NoahOn November 16, 2015, we
acquired 100% membership interest in Noah Consulting, LLC. As of March 31, 2016, we have invested an aggregate of $37 million
in the subsidiary. During fiscal 2016, we engaged Noah for software development services for which we have been billed $2 million.



See
to note 2.18, Related party transactions, under  Item 18 of this Annual Report for details of transactions with Key
management personnel.



Employment and indemnification agreements



Refer to the section titled ‘Employment
and Indemnification agreements’ under Item 6 of this Annual Report.



Loans to employees



We provide personal loans and salary
advances to our employees who are not executive officers or directors.



The annual rates of interest for these
loans vary from 0% to 10%. Loans aggregating $50 million, $40 million and $41 million were outstanding as of March 31, 2016, 2015
and 2014, respectively.



Item 8. Financial Information



CONSOLIDATED STATEMENTS AND OTHER
FINANCIAL INFORMATION



The following financial statements and
auditors’ report appear under Item 18 in this Annual Report on Form 20-F and are incorporated herein by reference:



|· | Report of Independent Registered Public Accounting Firm
|- | -------------------------------------------------------



|· | Consolidated balance sheets as of March 31, 2016 and 2015
|- | ---------------------------------------------------------



|· | Consolidated statements of comprehensive income for the years ended March 31, 2016, 2015 and 2014
|- | -------------------------------------------------------------------------------------------------



|· | Consolidated statements of changes in equity for the years ended March 31, 2016, 2015 and 2014
|- | ----------------------------------------------------------------------------------------------



|· | Consolidated statements of cash flows for the years ended March 31, 2016, 2015 and 2014
|- | ---------------------------------------------------------------------------------------



|· | Notes to the consolidated financial statements
|- | ----------------------------------------------



|· | Financial Statement Schedule II- Valuation and qualifying accounts
|- | ------------------------------------------------------------------



Export revenue



For fiscal 2016, 2015 and 2014, we generated
$9,255 million, $8,502 million and $8,036 million, or 97.4%, 97.6% and 97.4% of our total revenues of $9,501 million, $8,711 million
and $8,249 million, respectively, from the export of our products and rendering of services outside of India.



Legal proceedings



This information is set forth under Item
4 under the heading “Legal proceedings” and such information is incorporated herein by reference.



Dividends



Under Indian law, a corporation pays
dividends upon a recommendation by the Board and approval by a majority of the shareholders, who have the right to
decrease but not increase the amount of the dividend recommended by the Board. Dividends may be paid out of profits
of an Indian company in the year in which the dividend is declared or out of the undistributed profits of previous fiscal years.



The Board increased dividend pay-out
ratio from up to 40% to up to 50% of post-tax consolidated profits effective fiscal 2015.



In fiscal 2016, we paid final dividend
for fiscal 2015 of $0.47 and an interim dividend for fiscal 2016 of $0.15. In fiscal 2015 and 2014, we paid cash dividends of approximately
$1.21 and $0.82 per equity share (not adjusted for bonus share issue), respectively. Holders of ADSs will be entitled to receive
dividends payable on equity shares represented by such ADSs. Cash dividends on equity shares represented by ADSs are paid to the
Depositary in Indian rupees and are generally converted by the Depositary into U.S. dollars and distributed, net of Depositary
fees, taxes, if any, and expenses, to the holders of such ADSs. Although we have no current intention to discontinue dividend payments,
future dividends may not be declared or paid and the amount, if any, thereof may be decreased.



Translations from Indian rupees to U.S.
dollars effected on or after April 1, 2008 are based on the fixing rate in the City of Mumbai for cable transfers in Indian rupees
as published by the FEDAI.



|Fiscal                                       | Dividend per Equity Share() | Dividend per Equity Share ($) (1) | Dividend per ADS ($)(1)
|-------------------------------------------- | --------------------------- | --------------------------------- | -----------------------
|2016- Interim                                | 10.00                       | 0.15                              | 0.15                   
|2016- Final dividend for fiscal 2015
    (2) | 29.50                       | 0.47                              | 0.47                   
|2015(3)                                      | 73.00                       | 1.21                              | 1.21                   
|2014(3)                                      | 47.00                       | 0.82                              | 0.82                   



|(1) | Converted
    at the monthly exchange rate in the month of declaration of dividend.
|--- | -----------------------------------------------------------------------------------
|(2) | Not
    adjusted for June 17, 2015 bonus issue                                     
|(3) | Not
    adjusted for Bonus shares                                                  





SIGNIFICANT CHANGES



None.



Item 9. The Offer and Listing



PRICE HISTORY



Our equity shares are traded in India
on the BSE Limited, or BSE, and the National Stock Exchange of India Limited, or NSE, or collectively, the Indian stock exchanges.
Our ADSs are traded on NYSE, Euronext London and Paris, under the ticker symbol ‘INFY’. Each ADS represents one equity
share. Our ADSs began trading on the NASDAQ on March 11, 1999. Following our voluntary delisting from the NASDAQ Global Select
Market on December 11, 2012, we began trading of our ADSs on the New York Stock Exchange (NYSE) on December 12, 2012, under the
ticker symbol INFY. We listed our ADSs on the Euronext London and Paris markets on February 20, 2013.



The Deutsche Bank Trust Company Americas
serves as a depositary with respect to our ADSs traded on the market pursuant to the Deposit Agreement dated March 10, 1999, as
amended and restated.



As of March 31, 2016, we had 2,296,944,664
equity shares issued and outstanding. There were 30,199 record holders of ADRs, evidencing 385,317,937 ADSs (1 ADS equivalent to
1 equity share). As of March 31, 2016, there were 586,741 record holders of our equity shares listed and traded on the Indian stock
exchanges.



The following tables set forth for the
periods indicated the price history of the equity shares and the ADSs on the Indian stock exchanges, the NASDAQ and the NYSE. The
currency of trade of the ADSs in the U.S. is USD and at London and Paris is Euro (EUR).



Each ADS currently represents one equity
share. All translations from Indian rupees to U.S. dollars are based on fixing rate in the city of Mumbai on March 31, 2016 for
cable transfers in Indian rupees as published by the FEDAI, which was 66.26 per $1.00. The high and low prices for the Indian stock
exchanges, the NYSE and NASDAQ are provided below:

(Prices in Dollars)

|Fiscal         | BSE   | NSE   | NYSE / NASDAQ (1)
|-------------- | ----- | ----- | -----------------
|               | High  | Low   | High             
|2016           | 18.63 | 14.07 | 18.67            
|2015           | 18.68 | 11.58 | 18.69            
|2014           | 15.34 | 8.85  | 15.33            
|2013           | 12.02 | 8.50  | 12.02            
|2012           | 13.23 | 8.76  | 13.23            
|Fiscal 2016    |       |       |                  
|First Quarter  | 16.93 | 14.41 | 16.94            
|Second Quarter | 17.90 | 14.07 | 17.90            
|Third Quarter  | 18.40 | 15.28 | 18.41            
|Fourth Quarter | 18.63 | 15.57 | 18.67            
|Fiscal 2015    |       |       |                  
|First Quarter  | 13.49 | 11.58 | 13.55            
|Second Quarter | 15.17 | 12.76 | 15.18            
|Third Quarter  | 17.61 | 14.40 | 17.61            
|Fourth Quarter | 18.68 | 15.32 | 18.69            
|Fiscal 2014    |       |       |                  
|First Quarter  | 11.88 | 8.85  | 11.88            
|Second Quarter | 12.60 | 9.62  | 12.64            
|Third Quarter  | 14.25 | 12.06 | 14.25            
|Fourth Quarter | 15.34 | 12.92 | 15.33            
|Month          |       |       |                  
|Mar-16         | 18.63 | 16.44 | 18.67            
|Feb-16         | 18.01 | 16.10 | 18.03            
|Jan-16         | 17.65 | 15.57 | 17.66            
|Dec-15         | 16.75 | 15.45 | 16.75            
|Nov-15         | 17.44 | 15.28 | 17.47            
|Oct-15         | 18.40 | 16.41 | 18.41            



|Note: | Adjusted
    for bonus share issue wherever applicable.
|----- | -------------------------------------------------------



|(1) | Our ADSs traded on the NASDAQ until close of trading hours on December 11, 2012 and began trading on the New York Stock Exchange on December 12, 2012.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------



Source for all tables above: www.bseindia.comfor BSE quotes, www.nseindia.com for NSE quotes, www.nyse.com for NYSE quotes and www.nasdaq.com for NASDAQ
quotes.



On
May 18, 2016, the closing price of equity shares on the BSE was  1,209.75 equivalent to $18.06 per equity share and on the NSE
was 1,209.85 equivalent to $18.06 per equity share based on the exchange rate on that date and on May 18,
2016, the closing price of ADSs on the NYSE was $18.64 per ADS.



The conversion of our equity shares into ADSs is governed by guidelines issued by the Reserve Bank of India.



Item 10. Additional Information



MEMORANDUM AND ARTICLES OF ASSOCIATION



The corporate legal framework governing
companies in India has undergone a change with the enactment of the Companies Act, 2013, which has been approved by the houses
of the Indian Parliament, and received presidential approval on August 29, 2013. The Companies Act, 2013 has replaced the Companies
Act, 1956, which has hitherto governed companies and certain other associations, in stages. While several provisions of the Companies
Act, 2013 were notified as law on September 12, 2013, February 27, 2014 and April 1, 2014, a few provisions of the Companies Act,
2013 are yet to be notified as effective by the Government of India. Pending notification of the Companies Act, 2013 in its entirety,
certain provisions of the Companies Act, 1956, which have not ceased to be effective by enactment of the corresponding provisions
of the Companies Act, 2013 continue to be effective, along with the notified provisions of the Companies Act, 2013. The Companies
Act, 2013 was amended by Companies (Amendment) Act, 2015. The Government of India has introduced the Companies (Amendment) Bill,
2016 in the lower house of the Indian Parliament on March 16, 2016 to further amend the Companies Act, 2013.

Accordingly, the corporate legal framework
governing the Company as on the date hereof is the notified provisions of the Companies Act, 2013, as amended from time to time,
read with the Companies Act, 1956 (to the extent still in force)(the “Indian Companies Act”).



Set forth below is the material information
concerning our share capital and a brief summary of the material provisions of our Articles of Association, Memorandum of Association
and the Indian Companies Act, all as currently in effect. The following description of our equity shares and the material provisions
of our Articles of Association and Memorandum of Association does not purport to be complete and is qualified in its entirety by
our Articles of Association filed previously as an exhibit to the Annual Report on Form 20-F and Memorandum of Association that
is filed as an exhibit to this Annual Report on Form 20-F. The summary below is not intended to constitute a complete analysis
of the Indian Companies Act and is not intended to be a substitute for professional legal advice.



Our
Articles of Association provide that the minimum number of directors shall be 3 and the maximum number of directors shall be 18.
Currently, we have 9 directors. As per the Indian Companies Act, unless the Articles of Association of a company provide for all
directors to retire at every Annual General Meeting, not less than two-third of the directorsof a public company must retire by rotation, while the remaining one-third may remain on the Board until they resign
or are removed. Our Articles of Association require two thirds of our directors to retire by rotation. One-third of the directors
who are subject to retirement by rotation must retire at each Annual General Meeting. A retiring director is eligible for re-election.
As per the Indian Companies Act, independent directors are to retire after 5 years and may be re-appointed only for two consecutive
terms.



Executive directors are required to retire
at age 60 in accordance with our employee retirement policies applicable in India. Other members of the Board must retire from
the Board at age 70. The age of retirement for independent directors, shall be 70 years. An independent Board chair is permitted
to serve in the capacity for a fixed term of five years and until age 70.



Our Articles of Association do not require
that our directors have to hold shares of our company in order to serve on our Board.



The Companies Act, 2013 provides that
any director who has a personal interest in a transaction being discussed by the board of directors must disclose such interest
and must not participate in the meeting where such transaction is being discussed. A director is required to disclose his personal
interest to the board of directors on an annual basis and at the first meeting of the board of directors after the interest arises.
The remuneration payable to our directors may be fixed by the Board in accordance with the Indian Companies Act and provisions
prescribed by the Government of India. At meetings of the board, our directors may not vote on their own remuneration unless such
remuneration has been recommended by our Nomination and Remuneration Committee details of which have been set out in Item 6 of
this Annual Report. Our Articles of Association provide that our directors may generally borrow any sum of money for the Company’s
legitimate corporate purposes, provided, that the consent of the shareholders is required where any amounts to be borrowed, when
combined with any already outstanding debt (excluding temporary loans from our bankers in the ordinary course of business), exceeds
the aggregate of our paid-up capital and free reserves. Under the Companies Act, 2013, such consent of the shareholders should
be obtained by way of a special resolution passed in a general meeting.



Objects and Purposes of our Memorandum
of Association



The following is a summary of our Objects
as set forth in Section III of our Memorandum of Association:



|· | To provide services of every kind including commercial, statistical, financial, accountancy, medical, legal, management, educational, engineering, data processing, communication and other technological, social or other services;
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | To carry on all kinds of business as importer, exporter, buyers, sellers and lessors of and dealers in all types of components and equipment necessary to provide the services our objects enlist;
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | To manufacture, export, import, buy, sell, rent, hire or lease or otherwise acquire or dispose or deal in all kinds of digital equipment, numerical controller, flexible manufacturing systems, robots, communication systems, computers, computer peripherals, computer software, computer hardware, computer technology, machines, computer aided teaching aids, energy saving devices, alternative sources of energy, electrical and electronics components, devices, instruments, equipment and controls for any engineering applications, and all other related components, parts and products used in communication and computers;
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | To conduct or otherwise subsidize or promote research and experiments for scientific, industrial, commercial, economic, statistical and technical purposes; and
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | To carry on any other trade or business whatsoever as can in our opinion be advantageously or conveniently carried on by us.
|- | ----------------------------------------------------------------------------------------------------------------------------



General



Our authorized share capital is 12,000,000,000
(Rupees one thousand two hundred crore only) divided into 2,400,000,000 (two hundred and forty crore only) equity shares, having
a par value of 5/- per share.



As of March 31, 2016, 2,296,944,664 equity
shares were issued, outstanding and fully paid. The equity shares are our only class of share capital. We currently have no convertible
debentures or warrants outstanding. As of March 31, 2016, we had 221,505 options outstanding to purchase equity shares. For the
purposes of this Annual Report on Form 20-F, “shareholder” means a shareholder who is registered as a member in our
register of members or whose name appears in the beneficiary position maintained by the depositories.



Dividends



Under the Companies Act, 2013 our Board
recommends the payment of a dividend which is then declared by our shareholders in a general meeting. However, the Board is not
obliged to recommend a dividend.



Under our Articles of Association and
the Companies Act, 2013 our shareholders may, at the Annual General Meeting, declare a dividend of an amount less than that recommended
by the Board, but they cannot increase the amount of the dividend recommended by the Board. In India, dividends are generally declared
as a percentage of the par value of a company’s equity shares and are to be distributed and paid to shareholders in cash
and in proportion to the paid-up value of their shares, within 30 days of the Annual General Meeting at which the dividend is approved
by shareholders. Pursuant to our Articles of Association and the Indian Companies Act, our Board has the discretion to declare
and pay interim dividends without shareholder approval. As per the terms of our listing of the equity shares and ADSs of the Company,
we are required to inform the stock exchanges, on which our equity shares and ADSs are listed, of the rate of dividend declared
and the record date for determining the shareholders who are entitled to receive dividends. Under the Companies Act, 2013, dividend
can be paid only in cash to registered shareholders as of the record date. Dividend may also be paid in cash or by cheque or warrant
or in any electronic mode to the shareholder.



The Companies Act, 2013 provides that
any dividends that remain unpaid or unclaimed after a period of 30 days from the date of declaration of a dividend are to be transferred
to a special bank account opened by the company at an approved bank. We transfer any dividends that remain unclaimed after 30 days
to such an account. If any amount in this account has not been claimed by the eligible shareholders within seven years from the
date of the transfer, we transfer the unclaimed dividends to an Investor Education and Protection Fund established by the Government
of India under the provisions of the Companies Act, 2013. After the transfer to this fund, such unclaimed dividends may not be
claimed by the shareholders entitled to receive such dividends from the company.



Under the Companies Act, 2013 dividends
may be paid out of profits of a company in the year in which the dividend is declared after providing for depreciation or out of
the undistributed profits of previous fiscal years after providing for depreciation. Before declaring any dividend in any financial
year, a company may transfer a percentage of its profits which it considers appropriate to its reserves.



The Companies Act, 2013 further provides
that in the event of an inadequacy or absence of profits in any year, a dividend may be declared for such year out of the company’s
accumulated profits that have been transferred to its reserves, subject to the following conditions:



|· | the dividend rate declared shall not exceed the average of the rates at which dividends were declared by the company in the three years immediately preceding that year;
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | The total amount to be drawn from the accumulated profits earned in the previous years and transferred to the reserves may not exceed an amount equivalent to 10% of the sum of its paid-up capital and free reserves as appearing in the latest audited financial statement, and the amount so drawn is to be used first to set off the losses incurred in the fiscal year in which dividend is declared before any dividends in respect of equity shares are declared;
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | the balance of reserves after such withdrawals shall not fall below 15% of the company’s paid-up capital as appearing in the latest audited financial statement; and
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | a dividend may be declared only after set off of carried over losses and depreciation (whichever is less), not provided in previous year against the profit of the company of the current year for which the dividend is declared or paid.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Bonus Shares



In addition to permitting dividends to
be paid out of current or retained earnings as described above, the Companies Act, 2013 permits a company to distribute an amount
transferred from its free reserves to its shareholders in the form of bonus shares (similar to a stock dividend). The Companies
Act, 2013 also permits the issuance of bonus shares from capitalization of the securities premium account and the capital redemption
account. Bonus shares are distributed to shareholders in the proportion recommended by the board of directors and such announcement
of the decision of the board of directors recommending an issue of bonus shares cannot be subsequently withdrawn. Shareholders
of the company on a fixed record date are entitled to receive such bonus shares.



Any issue of bonus shares would be subject
to the guidelines issued by the SEBI in this regard. The relevant SEBI guidelines prescribe that no company shall, pending conversion
of convertible debt securities, issue any shares by way of bonus unless similar benefit is extended to the holders of such convertible
debt securities, through reservation of shares in proportion to such conversion (which may be issued at the time of conversion
of the debt securities). The bonus issue must be made out of free reserves built out of the genuine profits or share premium collected
in cash only. The bonus issue cannot be made unless the partly paid shares, if any existing, are made fully paid-up. Further, for
the issuance of such bonus shares a company should not have defaulted in the payment of interest or principal in respect of fixed
deposits and interest on existing debentures or principal on redemption of such debentures. The declaration of bonus shares in
lieu of dividend cannot be made. Further a company should have sufficient reason to believe that it has not defaulted in respect
of the payment of statutory dues of the employees such as contribution to provident fund, gratuity, bonus, etc. The issuance of
bonus shares must be implemented within 2 months from the date of approval by the board of directors and cannot be withdrawn after
the decision to make a bonus issue has been made.



Consolidation and Subdivision of Shares



The Companies Act, 2013 permits a company
to split or combine the par value of its shares at a general meeting of the shareholders, if so authorized by its Articles of Association,
with the approval of its shareholders. Shareholders of record on a fixed record date are entitled to receive the split or combination.



Pre-emptive Rights and Issue of Additional
Shares



The Companies Act, 2013 gives shareholders
the right to subscribe to new shares in proportion to their respective existing shareholdings in the event of a further issue of
shares by a company, unless otherwise determined by a special resolution passed by a General Meeting of the shareholders. Under
the Companies Act, 2013 in the event of a pre-emptive issuance of shares, subject to the limitations set forth above, a company
must first offer the new shares to the shareholders on a fixed record date. The offer must include: (i) the right, exercisable
by the shareholders on record, to renounce the shares offered in favor of any other person; and (ii) the number of shares offered
and the period of the offer, which may not be less than 15 days and not exceeding 30 days from the date of offer. If the offer
is not accepted it is deemed to have been declined and thereafter the board of directors is authorized under the Companies Act,
2013 to distribute any new shares not purchased by the pre-emptive rights holders in the manner which is not disadvantageous to
the shareholders and the company.



Meetings of Shareholders



We must convene an Annual General
Meeting of shareholders each year within 15 months of the previous Annual General Meeting or within six months of the end of
the previous fiscal year, whichever is earlier. In certain circumstances a three month extension may be granted by the
Registrar of Companies to hold the Annual General Meeting. The Annual General Meeting of the shareholders is generally
convened by our Company Secretary pursuant to a resolution of the Board. In addition, the Board may convene an Extraordinary
General Meeting (EGM) of shareholders when necessary or at the request of a shareholder or shareholders holding at least 10%
of our paid up capital carrying voting rights. Written notice setting out the agenda of any meeting must be given at least 21
days prior to the date of any General Meeting to the shareholders of record, excluding the days of mailing and date of the
meeting. The Annual General Meeting of shareholders must be held at our registered office or at such other place within the
city in which the registered office is located.



Voting Rights



At
any General Meeting,to provide opportunity to the shareholders
for exercising theirvotes
towards the resolutionsproposed
at the AGM, the Company arranges for e-voting facility andvoting
through ballot will also be made available at theAGMand the members who have not already cast their vote by remotee-voting can exercise their vote at the AGM.The Chairperson has a casting vote in the case of any tie. Any shareholder of the company entitled to attend and vote at a meeting
of the company may appoint a proxy. The instrument appointing a proxy must be delivered to the company at least 48 hours prior
to the meeting. Unless the articles of association otherwise provide, a proxy may not vote except on a poll. A corporate shareholder
may appoint an authorized representative who can vote on behalf of the shareholder, both upon a show of hands and upon a poll.
An authorized representative is also entitled to appoint a proxy. Pursuant to the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 (“Listing Regulations”), it is now mandatory for e-voting facilities to be provided to all
shareholders in respect of all shareholders’ resolutions in accordance with the procedure prescribed under the Indian Companies
Act.



As per the Companies Act, 2013 ordinary
resolutions may be passed by simple majority of those present and voting at any General Meeting for which the required period of
notice has been given. However, special resolutions for matters such as amendments to the articles of association, the waiver of
preemptive rights for the issuance of any new shares and a reduction of share capital, require that votes cast in favor of the
resolution (whether by show of hands or on a poll) are not less than three times the number of votes, if any, cast against the
resolution by members so entitled and voting. Certain resolutions such as those listed below are to be voted on only by a postal
ballot:



|· | alteration of the objects clause of the memorandum;
|- | ---------------------------------------------------



|· | change in place of registered office outside the local limits of any city, town or village;
|- | -------------------------------------------------------------------------------------------



|· | change in objects for which a company has raised money from public through prospectus and still has any unutilized amount out of the money so raised;
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------



|· | issue of shares with differential rights as to voting or dividend or otherwise under Section 43 (a)(ii) of the Companies Act, 2013;
|- | -----------------------------------------------------------------------------------------------------------------------------------



|· | variation in the rights attached to a class of shares or debentures or other securities as specified under Section 48 of the Companies Act, 2013;
|- | -------------------------------------------------------------------------------------------------------------------------------------------------



|· | buy-back of shares;
|- | -------------------



|· | election of a director under Section 151 of the Companies Act, 2013;
|- | --------------------------------------------------------------------



|· | sale of the whole or substantially the whole of an undertaking of a company as specified under Section 180 (1) (a) of the Companies Act, 2013; and
|- | --------------------------------------------------------------------------------------------------------------------------------------------------



|· | giving loans or extending guarantee or providing security in excess of the limit specified under Section 186 (3) of the Companies Act, 2013.
|- | --------------------------------------------------------------------------------------------------------------------------------------------



Register of Shareholders, Record Dates,
Transfer of Shares



We maintain a register of shareholders
held in electronic form through National Securities Depository Limited and the Central Depository Services (India) Limited. To
determine which shareholders are entitled to specified shareholder rights such as a dividend or a rights issue, we may close the
register of shareholders for a specified period not exceeding 30 days at one time. The date on which this period begins is the
record date. The Companies Act, 2013 requires us to give at least seven days prior notice to the public in the prescribed manner
before such closure, unless a lesser period is specified by the SEBI. We may not close the register of shareholders for more than
thirty consecutive days, and in no event for more than forty-five days in a year. Trading of our equity shares, however, may continue
while the register of shareholders is closed.



Following the introduction of the Depositories
Act, 1996, and the repeal of Section 22A of the Securities Contracts (Regulation) Act, 1956, which enabled companies to refuse
to register transfers of shares in some circumstances, the equity shares of a public company are freely transferable, subject only
to the provisions of Section 58 of the Companies Act, 2013 and Regulation 40 of the Listing Regulations. Since we are a public
company, the provisions of Section 58 will apply to us. In accordance with the provisions of Section 58(2) of the Companies Act,
2013, the securities or other interests of the member are freely transferable except where there is any contract or arrangement
between two or more persons in respect of transfer of securities, which may be enforced as a contract. If our Board refuses to
register a transfer of shares, the shareholder wishing to transfer his, her or its shares may file a civil suit or an appeal with
the Company Law Board / Tribunal.



Pursuant to Section 59 (4) of the Companies
Act, 2013, if a transfer of shares contravenes any of the provisions of the Companies Act, 2013, the Securities Contracts (Regulation)
Act, 1956 and Securities and Exchange Board of India Act, 1992 or the regulations issued thereunder or any other Indian laws, the
Company Law Board / Tribunal may, on application made by the relevant company, a depository, company, Depositary participant, the
holder of securities or the SEBI, direct any company or a Depositary to set right the contravention and to rectify the registers,
records of members and / or beneficial owners.



Under the Companies Act, 2013 unless
the shares of a company are held in a dematerialized form, a transfer of shares is effected by an instrument of transfer in the
form prescribed by the Indian Companies Act and the rules thereunder, together with delivery of the share certificates. A stamp
duty to the extent of 0.25% of the value of the shares (regardless of the consideration paid) is due and payable on the transfer
of shares in physical form. Our transfer agent for our equity shares is Karvy Computershare Private Limited located in Hyderabad,
India.



Disclosure of Ownership Interest



Section 89 of the Companies Act, 2013
requires holders of record who do not hold beneficial interests in shares of Indian companies to declare to the company certain
details, including the nature of the holder’s interest and details of the beneficial owner. Any person who fails to make
the required declaration within 30 days may be liable for a fine of up to 50,000 and where the failure is a continuing one, further
fine of 1,000 for each day that the declaration is not made. Failure to comply with Section 89 will not affect the obligation of
the company to register a transfer of shares or to pay any dividends to the registered holder of any shares pursuant to which such
declaration has not been made. While it is unclear under Indian law whether Section 89 applies to holders of ADSs of the company,
investors who exchange ADSs for the underlying equity shares of the company will be subject to the restrictions of Section 89.
Additionally, holders of ADSs may be required to comply with such notification and disclosure obligations pursuant to the provisions
of the Deposit Agreement to be entered into by such holders, the company and a Depositary.



Audit and Annual Report



Under
the Companies Act, 2013 a company must file its financial statements with the Registrar of Companies within 30 days from the date
of the Annual General Meeting. Copies of the annual report are also required to be sent to stock exchanges on which the company’s
shares are listedwithin 21 days of it being approved and adopted in the Annual General Meeting in accordance with the Listing
Regulations. At least 21 days before the Annual General Meeting of shareholders,
a listed company must distribute a statement of salient features of the financial statements to its shareholders or a detailed
version of the company’s financial statements if the shareholders ask for the same. A company must also file an annual return
containing a list of the company’s shareholders and other company information, within 60 days of the conclusion of the Annual
General Meeting.



Company Acquisition of Equity Shares



Under the Indian Companies Act, approval
by way of a special resolution of a company’s shareholders voting on the matter (votes cast in favor should be three times
the votes cast against) and approval of the court / tribunal of the state in which the registered office of the company is situated
is required to reduce the share capital of a company, provided such reduction is authorized by the articles of association of the
company. A company is not permitted to acquire its own shares for treasury operations.



A company may, under some circumstances,
acquire its own equity shares without seeking the approval of the court or tribunal in compliance with prescribed rules, regulations
and conditions of the Indian Companies Act. In addition, public companies which are listed on a recognized stock exchange in India
must comply with the provisions of the Securities and Exchange Board of India (Buy-back of Securities) Regulations, 1998 (Buy-back
Regulations). Since we are a public company listed on two recognized stock exchanges in India, we would have to comply with the
relevant provisions of the Companies Act, 2013 and the provisions of the Buy-back Regulations. Any ADS holder may participate in
a company’s purchase of its own shares by withdrawing his or her ADSs from the Depositary facility, acquiring equity shares
upon the withdrawal and then selling those shares back to the company.



There can be no assurance that equity
shares offered by an ADS investor in any buyback of shares by us will be accepted by us. The regulatory approvals required for
ADS holders to participate in a buyback are not entirely clear. ADS investors are advised to consult their legal advisors for advice
prior to participating in any buyback by us, including advice related to any related regulatory approvals and tax issues.



Liquidation Rights



As per the Indian Companies Act, certain
payments have preference over payments to be made to equity shareholders. These payments having preference include payments to
be made by the Company to its employees, taxes, payments to secured and unsecured lenders and payments to holders of any shares
entitled by their terms to preferential repayment over the equity shares. In the event of our winding-up, the holders of the equity
shares are entitled to be repaid the amounts of paid-up capital or credited as paid-upon those equity shares after payments have
been made by the company as set out above. Subject to such payments having been made by the company, any surplus assets are paid
to holders of equity shares in proportion to their shareholdings.



Redemption of Equity Shares



Subject to the buy-back of shares as
set out in the section titled “Company Acquisition of Equity Shares”, under the Companies Act, 2013 equity shares are
not redeemable.



Discriminatory Provisions in Articles



There are no provisions in our Articles
of Association discriminating against / in favor of any existing or prospective holder of such securities as a result of such shareholder
owning a substantial number of shares.



Alteration of Shareholder Rights



Under the Companies Act, 2013 and subject
to the provisions of the articles of association of a company, the rights of any class of shareholders can be altered or varied
(i) with the consent in writing of the holders of not less than three-fourths of the issued shares of that class; or (ii) by special
resolution passed at a separate meeting of the holders of the issued shares of that class. However, if the variation by one class
of shareholders affects the rights of any other class of shareholders, the consent of three-fourths of such other class of shareholders
shall also be required. In the absence of any such provision in the articles, such alteration or variation is permitted as long
as it is not prohibited by the terms of the issue of shares of such a class.



Limitations on the Rights to Own Securities



The limitations on the rights to own
securities of Indian companies, including the rights of non-resident or foreign shareholders to hold securities, are discussed
in the sections entitled ‘Currency Exchange Controls’ and ‘Risk Factors’ in Items 9 and 4 of this Annual
Report.



Provisions on Changes in Capital



Our authorized capital can be altered
by an ordinary resolution of the shareholders in a General Meeting. The additional issue of shares is subject to the pre-emptive
rights of the shareholders. In addition, a company may increase its share capital, consolidate its share capital into shares of
larger face value than that of its existing shares or sub-divide its shares by reducing their par value, subject to an ordinary
resolution of the shareholders in a General Meeting.



Takeover Code



In September 2011, the SEBI adopted the
Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (the Takeover Code)
which replaces the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997.Under
Takeover Code, upon acquisition of shares or voting rights in a public listed Indian company such that the aggregate share-holding
of the acquirer (meaning a person who directly or indirectly, acquires or agrees to acquire shares or voting rights in a target
company, or acquires or agrees to acquire control over the target company, either by himself or together with any person acting
in concert) is 5% or more of the shares of the company, the acquirer is required to, within two working days of such acquisition,
disclose the aggregate shareholding and voting rights in the company to the company and to the stock exchanges in which the shares
of the company are listed.



Further, an acquirer, who, together with
persons acting in concert with him, holds shares or voting rights entitling them to 5% or more of the shares or voting rights in
a target company must disclose every sale or acquisition of shares representing 2% or more of the shares or voting rights of the
company to the company and to the stock exchanges in which the shares of the company are listed within two working days of such
acquisition or sale or receipt of disclosure of allotment of such shares. This disclosure is required, in case of a sale, even
if such sale results in the shareholding of the acquirer falling below 5%.



Every person, who together with persons
acting in concert with him, holds shares or voting rights entitling him to exercise 25% or more of the voting rights in a target
company, has to disclose to the company and to stock exchanges, their aggregate shareholding and voting rights as of the thirty-first
day of March, in such target company within seven working days from the end of the financial year of that company.



The acquisition of shares or voting rights
which entitles the acquirer to exercise 25% or more of the voting rights in or control over the target company triggers a requirement
for the acquirer to make an open offer to acquire at least 26% of the total shares of the target company for an offer price determined
as per the provisions of the Takeover Code. The acquirer is required to make a public announcement for an open offer on the date
on which it is agreed to acquire such shares or voting rights. Such open offer shall only be for such number of shares as is required
to adhere to the maximum permitted non-public shareholding.



Where
the public shareholding in the target company is reduced to a level below the limit specified in theListing Regulations
read with SEBI circular CIR/CFD/CMD/14/2015 dated November 30, 2015 on account
of shares being acquired pursuant to an open offer, the acquirer is required to take necessary steps to facilitate compliance with
the public shareholding threshold within the time prescribed in the Securities Contract (Regulation) Rules, 1957. Pursuant to an
amendment to the Takeover Code dated March 24, 2015, an acquirer can make an offer for delisting the company if such acquirer declares
his intention to do so at the time of making the public announcement of an open offer. In other instances, the acquirer will not
be eligible to make voluntary delisting offer under the Securities and Exchange Board of India (Delisting of Existing Shares) Regulations,
2009, unless 12 months have elapsed from the date of the completion of offer.



Since we are a listed company in India,
the provisions of the Takeover Code will apply to us and to any person acquiring our equity shares or voting rights in our Company.



The ADSs entitle ADS holders to exercise
voting rights in respect of the Deposited Equity Shares (as described in the section titled “Voting Rights of Deposited Equity
Shares Represented by ADSs”). Accordingly, the requirement to make an open offer of at least 26% of the shares of a company
to the existing shareholders of the company would be triggered by an ADS holder where the shares that underlie the holder’s
ADSs represent 25% or more of the shares or voting rights of the company.



Pursuant to the Listing Regulations,
we have entered into listing agreements with each of the Indian stock exchanges on which our equity shares are listed, and must
report to the stock exchanges any disclosures made to the Company pursuant to the Takeover Code. Our articles of association do
not contain a provision that would have an effect of delaying, deferring or preventing a change in control of the company and that
would operate only with respect to a merger, acquisition or corporate restructuring involving our company.



Maintenance of Minimum Public Shareholding
as a Condition for Continuous Listing



The
Securities Contracts (Regulation) Rules, 1957 were amended on June 4, 2010 to make it mandatory for all listed companies in India
to have a minimum public shareholding of 25%. The term ‘public shareholding’ for
these purposes means equity shares of the company held by the public and includes shares underlying depository receipts if (i)
the holder of such depository receipts has the right to issue voting instruction and (ii) such depository receipts are listed
on an international exchange in accordance with the Depository Receipt Scheme, 2014. Equity shares of a company held by a trust
set up for implementing employee benefit schemes under the regulations framed by the Securities and Exchange Board of India is
excluded from ‘public shareholding’



Existing listed companies having a lower
public shareholding are required to reach the prescribed threshold of 25% by:





|a. | issuance of shares to public through prospectus; or
|-- | ---------------------------------------------------

|b. | offer for sale of shares held by promoters to public through prospectus;
or
|-- | ---------------------------------------------------------------------------

|c. | sale of shares held by promoters through the secondary market in terms
of SEBI guidelines; or
|-- | ---------------------------------------------------------------------------------------------

|d. | Institutional Placement Programme in terms of Chapter VIIIA of SEBI (Issue
of Capital and Disclosure Requirements) Regulations, 2009, as amended; or
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------

|e. | rights issues to public shareholders, with promoter / promoter group
shareholders forgoing their entitlement to equity shares, whether present or future, that may arise from such issue; or
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|f. | bonus issues to public shareholders, with promoter / promoter group shareholders
forgoing their entitlement to equity shares, whether present or future, that may arise from such issue; or
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|g. | any other method as may be approved by SEBI on a case to case basis.
|-- | --------------------------------------------------------------------





As
of March 31, 2016, our public shareholding was approximately at 86.76%.



Voting Rights of Deposited Equity
Shares Represented by ADSs



Under Indian law, voting in relation
to the equity shares is by show of hands unless a poll is demanded by a member or members present in person or by proxy holding
at least 10% of the total shares entitled to vote on the resolution or by those holding shares with an aggregate paid-up capital
of at least 5,00,000. The Listing Regulations now provide that an e-voting facility must be mandatorily provided to shareholders
in respect of all shareholders’ resolutions to in accordance with the procedure prescribed in the Indian Companies Act. A
proxy (other than a body corporate represented by an authorized representative) may not vote except on a poll.



As soon as practicable after receipt
of notice of any general meetings or solicitation of consents or proxies of holders of shares or other deposited securities, our
Depositary shall fix a record date for determining the holders entitled to give instructions for the exercise of voting rights.
The Depositary shall then mail to the holders of ADSs a notice stating (i) such information as is contained in such notice of meeting
and any solicitation materials, (ii) that each holder on the record date set by the Depositary will be entitled to instruct the
Depositary as to the exercise of the voting rights, if any pertaining to the deposited securities represented by the ADSs evidenced
by such holder’s ADRs, (iii) the manner in which such instruction may be given, including instructions to give discretionary
proxy to a person designated by us, and (iv) if the Depositary does not receive instructions from a holder, he would be deemed
to have instructed the Depositary to give a discretionary proxy to a person designated by us to vote such deposited securities,
subject to satisfaction of certain conditions.



On receipt of the aforesaid notice from
the Depositary, our ADS holders may instruct the Depositary on how to exercise the voting rights for the shares that underlie their
ADSs. For such instructions to be valid, the Depositary must receive them on or before a specified date.



The Depositary will try, as far as is
practical, and subject to the provisions of Indian law and our Memorandum of Association and our Articles of Association, to vote
or to have its agents vote in relation to the shares or other deposited securities as per our ADS holders’ instructions.
The Depositary will only vote or attempt to vote as per an ADS holder’s instructions. The Depositary will not itself exercise
any voting discretion.



Neither the Depositary nor its agents
are responsible for any failure to carry out any voting instructions, for the manner in which any vote is cast, or for the effect
of any vote. There is no guarantee that our shareholders will receive voting materials in time to instruct the Depositary to vote
and it is possible that ADS holders, or persons who hold their ADSs through brokers, dealers or other third parties, will not have
the opportunity to exercise a right to vote.



Insider Trading Regulations



On January 15, 2015, SEBI promulgated
the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 (“Revised Insider Trading
Regulations”). The Revised Insider Trading Regulations were effective from May 15, 2015 and from such date, the earlier
SEBI (Prohibition of Insider Trading) Regulations, 1992 have been repealed. The Revised Insider Trading Regulations covers within
its ambit both listed and proposed to be listed securities and in addition with trading, also lists communication or procuring
unpublished price sensitive information in violation of the Revised Insider Trading Regulations as an offence. In terms of the
Revised Insider Trading Regulations, the promoters, key managerial personnel and directors of a company are required to disclose
their respective holding of securities of the company as on May 15, 2015 within thirty days of the Revised Insider Trading Regulations
coming into effect. A similar disclosure is required to be made by every person subsequently becoming a promoter, key managerial
personnel or director of a company, within seven days of such appointment or becoming a promoter. Further, every promoter, employee
and director of a company is required to disclose to the company the number of securities acquired or disposed of by such individual
within two trading days of a transaction, if the value of the securities traded, whether in one transaction or a series of transactions
over any calendar quarter, aggregates to a traded value in excess of 1,000,000 or such other value as may be prescribed. The company
is required to notify the stock exchanges where its securities are listed within two days of receipt of such disclosure or becoming
aware of such information. Any company whose securities are listed on a stock exchange may, at its discretion, require any other
connected person or class of connected persons to make disclosures of holdings and trading in securities of the company.



MATERIAL CONTRACTS



We have entered into agreements with
our executive directors, Dr. Vishal Sikka, our CEO and MD and Mr. U.B. Pravin Rao, our COO.



Mr. Rao’s employment agreement
provides for a monthly salary, bonuses, and benefits including, vacation, medical reimbursements and gratuity contributions. This
agreement has a five-year term and either party may terminate the agreement with six months’ notice or as mutually agreed
between the parties. There are no benefits payable upon termination of this agreement. Mr. Rao’s employment agreement has
been filed previously as an exhibit to the Annual Report on Form 20-F.



Dr. Vishal Sikka’s executive employment agreement which was previously filed as an exhibit to the Annual
Report on Form 20-F was replaced, with a new executive employment agreement (New Executive Employment Agreement) following shareholder
approval through postal ballot. The New Executive Employment Agreement was effective as of April 1, 2016 and expires on March 31,
2021. The Board of the Company and its Nomination and Remuneration Committee have approved the following compensation:



|· | Base
                                         pay: an annual base salary of $1,000,000 to be paid in accordance with the Company’s
                                         normal practices and subject to withholding taxes;
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|· | Variable
                                         pay: annual performance-based variable pay at a target level
                                         of $3,000,000 less applicable tax and subject to the Company’s achievement of fiscal
                                         year performance targets set by the Board as described in the postal ballot;
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|· | Stock
                                         compensation: eligible to receive an annual grant of 1) $2,000,000 of fair value in RSUs
                                         which vest over time (‘time based RSUs’), subject to continued service and
                                         2) $5,000,000 in performance based equity and stock options, upon achievement of certain
                                         performance targetsas described in the postal ballot;
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|· | Employee
                                         benefits and paid vacation as applicable to other whole-time directors of the Company
|- | ---------------------------------------------------------------------------------------------------------------------------------------

|· | Minimum
                                         and maximum remuneration: Should Dr. Sikka fail to achieve minimum performance targets,
                                         his remuneration as proposed will fall to $3,000,000 annually, consisting of $1,000,000
                                         of base salary and $2,000,000 of time-based RSUs. If Dr. Sikka’s performance targets
                                         are exceeded, the performance-based payments for variable components of his compensation
                                         (variable pay and performance equity) will be capped at 150% of the target compensation
                                         for such variable components.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



We have agreed with Dr. Sikka to provide
each other with 90 days’ notice of termination as applicable. Dr. Sikka may be entitled to severance benefits depending on
the circumstances of his termination of employment. The form of the New Executive Employment Agreement for Dr. Sikka is filed as
an exhibit to this Annual Report on Form 20-F.



We have also entered into agreements
to indemnify our directors and officers for claims brought under U.S. laws to the fullest extent permitted by Indian law. These
agreements, among other things, indemnify our directors and officers for certain expenses, judgments, fines and settlement amounts
incurred by any such person in any action or proceeding, including any action by or in the right of Infosys Limited, arising out
of such persons services as our director or officer. The form of the indemnification agreement for our directors and officers has
been filed previously as an exhibit to the Annual Report on Form 20-F.



During fiscal 2015, we entered into a Restricted Stock Unit Award Agreement with Dr. Vishal Sikka, our Chief
Executive Officer and Managing Director. Pursuant to the Restricted Stock Unit Award Agreement, Dr. Sikka was granted 27,067 Restricted
Stock Units (the equivalent of 108,268 RSUs after adjustment for the bonus issues). The RSUs vest over a period of 4 years subject
to Dr. Sikka’s continued employment and upon achieving certain performance indicators set by the Board or the Nomination
and Remuneration Committee from time to time.



TheBoard in its meeting held on June 22, 2015, on recommendation of Nomination and Remuneration Committee, further granted 124,061
RSUs to Dr. Vishal Sikka. These RSUs are vesting over a period of four years from the date of the grant in the proportions specified
in the award agreement. The RSUs will vest subject to achievement of certain key performance indicators as set forth in the award
agreement for each applicable year of the vesting tranche and continued employment through each vesting date.



The award granted to Dr. Vishal Sikka
on June 22, 2015 was modified by the Nomination and remuneration committee on April 14, 2016. There is no modification or change
in the total number of RSUs granted or the vesting period (which is four years). The modifications relate to the criteria of vesting
for each of the years. Based on the modification, the first tranche of the RSUs will vest subject to achievement of certain key
performance indicators for the year ended March 31, 2016. Subsequent vesting of RSU's for each of the remaining years would be
subject to continued employment.



CURRENCY EXCHANGE CONTROLS



General



The subscription, purchase and sale of
shares of an Indian company are governed by various Indian laws restricting the issuance of shares by the company to non-residents
or subsequent transfer of shares by or to non-residents. These restrictions have been relaxed in recent years. Set forth below
is a summary of various forms of investment, and the restrictions applicable to each, including the requirements under Indian law
applicable to the issuance of ADSs.



Foreign Direct Investment Issuances
by the Company



Subject to certain conditions, under
current regulations, foreign direct investment in most industry sectors does not require prior approval of the Foreign Investment
Promotion Board (FIPB), or the RBI, if the percentage of equity holding by all foreign investors does not exceed specified
industry-specific thresholds. These conditions include certain minimum pricing requirements, compliance with the Takeover Code
(as described above), and ownership restrictions based on the nature of the foreign investor (as described below). Purchases by
foreign investors of ADSs are treated as direct foreign investment in the equity issued by Indian companies for such offerings.
Foreign investment of up to 100% of our share capital is currently permitted by Indian laws.



Subsequent Transfers



Restrictions for subsequent transfers
of shares of Indian companies between residents and non-residents were relaxed significantly as of October 2004. As a result, for
a transfer by way of a private arrangement between a resident and a non-resident of securities of an Indian company in the IT sector,
such as ours, no prior approval of either the RBI or the Government of India is required, as long as certain conditions are met.
These conditions include compliance, as applicable, with pricing guidelines, the Takeover Code (as described above), and the ownership
restrictions based on the nature of the foreign investor (as described below). In case of a sale of shares of a listed Indian company
by a resident to a non-resident, the minimum price per share payable by a non-resident to acquire the shares cannot be less than
the higher of:



|a. | the average of the weekly high and low of the volume weighted average price of equity shares on a stock exchange during the 26 weeks prior to the relevant date; and
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------



|b. | the average of the weekly high and low volume weighted average prices of equity shares on a stock exchange during the 2 weeks period prior to the relevant date.
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------



In case of a sale of shares of a listed
Indian company by a non-resident to a resident, the price computed in accordance with the procedure set above will be the maximum
price per share that can be paid by the resident for the purchase of shares from a non-resident.



A non-resident cannot acquire shares
of a listed company on a stock exchange unless such non-resident is (a) registered as a foreign portfolio investor (FPI) with the
SEBI; or (b) a person of Indian nationality or origin residing outside of India (NRIs);



The conditions prescribed for investment
by a non-resident on the stock exchange under the foreign direct investment scheme pursuant above, are as follows:





|i.   | The non-resident investor has already acquired and continues
        to hold control in accordance with the Takeover Code;                                                                                                                                                 
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|ii.  | The amount of consideration for transfer of shares to non-resident
        consequent to purchase on the stock exchange may be paid as below:                                                                                                                              
|     | a.                                                                                                                                                                                                                                                                         
|     | b.                                                                                                                                                                                                                                                                         
|     | c.                                                                                                                                                                                                                                                                         
|     | d.                                                                                                                                                                                                                                                                         
|iii. | The pricing for subsequent transfer of shares to non-resident
        shareholder shall be in accordance with the pricing guidelines under the Foreign Exchange Management Act, 1999; and                                                                                  
|iv.  | The original and resultant investments are in line with the
        extant foreign direct investment policy and the regulations under the Foreign Exchange Management Act, 1999 in respect of sectoral
        cap, entry route, reporting requirement, documentation, etc;







Transfers of shares or convertible debentures
of the company, by way of sale or gift, between two non-residents are not subject to RBI approvals or pricing restrictions. However,
for industries other than the technology sector, approval from the Government of India may be required for a transfer between two
non-residents.



Portfolio Investment by Non-Resident
Indians



Investments by persons of Indian nationality
or origin residing outside of India NRIs or registered Foreign Institutional Investors (FIIs) (as described below) made through
a stock exchange are known as Portfolio Investments.



NRIs are permitted to make Portfolio
Investments on favorable tax and other terms under India’s Portfolio Investment Scheme. Under the scheme, an NRI can purchase
up to 5% of the paid-up value of the shares issued by a company, subject to the condition that the aggregate paid-up value of shares
purchased by all NRIs does not exceed 10% of the paid-up capital of the company. The 10% ceiling may be exceeded if a special resolution
is passed in a General Meeting of the shareholders of a company, subject to an overall ceiling of 24%. In addition to Portfolio
Investments in Indian companies, NRIs may also make foreign direct investments in Indian companies pursuant to the foreign direct
investment route discussed above.



Overseas corporate bodies controlled
by NRIs, or OCBs, were previously permitted to invest on favorable terms under the Portfolio Investment Scheme. The RBI no longer
recognizes OCBs as an eligible class of investment vehicle under various routes and schemes under the foreign exchange regulations.



Investment by Foreign Portfolio Investors



Investments by FPIs is governed by the
SEBI (Foreign Portfolio Investors) Regulations, 2014 (FPI Regulations). FPIs are required to be registered with the designated
Depositary participant on behalf of the Securities Exchange Board of India subject to compliance with ‘Know Your Customer’
norms. FPIs are permitted to invest only in the following securities:







|a. | securities
    in the primary and secondary markets including shares, debentures and warrants of companies, listed or to be listed on a recognized
    stock exchange in India;                                              
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|b. | units
    of schemes floated by domestic mutual funds, whether listed on a recognized stock exchange or not;                                                                                                                 
|c. | units
    of schemes floated by a collective investment scheme;                                                                                                                                                              
|d. | derivatives
    traded on a recognized stock exchange;                                                                                                                                                                       
|e. | treasury
    bills and dated government securities;                                                                                                                                                                          
|f. | commercial
    papers issued by an Indian company;                                                                                                                                                                           
|g. | Rupee
    denominated credit enhanced bonds;                                                                                                                                                                                 
|h. | security
    receipts issued by asset reconstruction companies;                                                                                                                                                              
|i. | perpetual
    debt instruments and debt capital instruments, as specified by the Reserve Bank of India from time to time;                                                                                                    
|j. | listed
    and unlisted non-convertible debentures or bonds issued by an Indian company in the infrastructure sector, where ‘infrastructure’
    is defined in terms of the extant External Commercial Borrowings guidelines;
|k. | non-convertible
    debentures or bonds issued by Non-Banking Financial Companies categorized as ‘Infrastructure Finance Companies’
    by the Reserve Bank of India;                                                        
|l. | Rupee
    denominated bonds or units issued by infrastructure debt funds;                                                                                                                                                    
|m. | Indian
    depository receipts; and                                                                                                                                                                                          
|n. | such
    other instruments specified by the Securities and Exchange Board of India from time to time.                                                                                                                        





A single foreign portfolio investor or
an investor group is permitted to purchase equity shares of a company only below 10% of the total issued capital of the company.
Subject to compliance with all applicable Indian laws, rules, regulations, guidelines and approvals in terms of the FPI Regulations,
an FPI, other than Category III foreign portfolio investor and unregulated broad based funds, which are classified as Category
II foreign portfolio investor by virtue of their investment manager being appropriately regulated, may issue or otherwise deal
in offshore derivative instruments (as defined under the FPI Regulations as any instrument, by whatever name called, which is issued
overseas by a FPI against securities held by it that are listed or proposed to be listed on any recognized stock exchange in India,
as its underlying) directly or indirectly, only in the event (i) such offshore derivative instruments are issued only to persons
who are regulated by an appropriate regulatory authority; and (ii) such offshore derivative instruments are issued after compliance
with ‘know your client’ norms. An FPI is also required to ensure that no further issue or transfer of any offshore
derivative instrument is made by or on behalf of it to any persons that are not regulated by an appropriate foreign regulatory
authority.



The FPI Regulations became effective
as of June 1, 2014. Any FII or Qualified Foreign Investor (QFI) who holds a valid certificate of registration will be deemed to
be a FPI till the expiry of the block of three years for which fees has been paid per the Securities and Exchange Board of India
(Foreign Institutional Investors) Regulations, 1995. All existing FIIs and sub accounts, subject to payment of conversion fees
specified in the FPI Regulations, may continue to buy, sell or otherwise deal in securities subject to the provisions of the FPI
Regulations, until the earlier of (i) expiry of its registration as a FII or sub-account, or (ii) obtaining a certificate of registration
as foreign portfolio investor. All QFIs may continue to buy, sell or otherwise deal in securities until the earlier of (i) up to
a period of a one year from the date of commencement of the FPI Regulations; (ii) obtaining a certificate of registration as a
foreign portfolio investor.



In furtherance of the FPI Regulations,
the RBI amended relevant provisions of Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside
India) Regulations, 2000 by a notification dated March 13, 2014. The portfolio investor registered in accordance with the FPI Regulations
would be called ‘Registered Foreign Portfolio Investor (RFPI)’. Accordingly, RFPI may purchase and sell shares and
convertible debentures of an Indian company through a registered broker as well as purchase shares and convertible debentures offered
to the public under the FPI Regulations. Further, RFPI may sell shares or convertible debentures so acquired (i) in an open offer
in accordance with the Securities Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;
or (ii) in an open offer in accordance with the Securities Exchange Board of India (Delisting of Equity Shares) Regulations, 2009;
or (iii) through buyback of shares by a listed Indian company in accordance with the Securities Exchange Board of India (Buy-back
of Securities) Regulations, 1998. RFPI may also acquire shares or convertible debentures (i) in any bid for, or acquisition of
securities in response to an offer for disinvestment of shares made by the Central Government or any State Government; or (ii)
in any transaction in securities pursuant to an agreement entered into with merchant banker in the process of market making or
subscribing to unsubscribed portion of the issue in accordance with Chapter XB of the SEBI (ICDR) Regulations, 2009.



The individual and aggregate investment limits for the RFPIs should be below 10% or 24% respectively of the
total paid-up equity capital or 10% or 24% respectively of the paid-up value of each series of convertible debentures issued by
an Indian company and such investment should be within the overall sectoral caps prescribed under the FDI Policy. The aggregate
investment limits for the RFPI can also be increased to the sectoral cap / statutory ceiling, as applicable, by the Indian company
concerned through a resolution by itsboard of directors followed by a special resolution to that effect by its shareholders and
subject to prior notification to RBI. Portfolio investment, up to aggregate foreign investment level of 49% or sectoral / statutory
cap, whichever is lower, will not be subject to either Government approval or compliance of sectoral conditions, as the case may
be, if such investment does not result in transfer of ownership and/ or control of Indian entities from resident Indian citizens
to non-resident entities. RFPI may invest in government securities and corporate debt subject to limits specified by the RBI and
Securities and Exchange Board of India from time to time and to trade in all exchange traded derivative contracts on the stock
exchanges in India subject to the position limits as specified by Securities and Exchange Board of India from time to time.



Takeover Code



For
a detailed description of the Takeover Code, see the section titled “Takeover Code” in Item 10 of this Annual Report.



ADSs



Issue of securities through the depository
receipt mechanism



Issue of securities through the depository
receipt mechanism by Indian companies is governed by the Companies Act, 2013 (Companies Act), the Companies (Issue of Global Depository
Receipts) Rules, 2014 (Depository Receipts Rules) and the Depository Receipts Scheme, 2014 (the “DR Scheme”).



The Government of India approved the
DR Scheme on October 21, 2014, which came into force on December 15, 2014. Consequently, the Issue of Foreign Currency Convertible
Bonds and Ordinary Shares (Through Depository Receipt Mechanism) Scheme, 1993 (the 1993 Scheme”) has been repealed except
to the extent relating to foreign currency convertible bonds. The DR Scheme is in addition to the other policies or facilities,
as described above, relating to investments in Indian companies by foreign investors.



Under the DR Scheme, an Indian company,
listed or unlisted, private or public, is permitted to issue securities, including equity shares, through the depository receipt
mechanism if such company has not been specifically prohibited from accessing capital markets or dealing in securities. Permissible
securities that can be issued by an Indian company through the depository receipt mechanism are ‘securities’ as defined
under the Securities Contracts (Regulation) Act, 1956, which includes, inter alia, shares, bonds, derivatives and unit of mutual
funds, and similar instruments issued by private companies, provided that such securities are in dematerialized form.



An Indian company can issue securities
to a foreign depository for the purpose of issuing depository receipts through any mode permissible for the issue of such securities
to other investors. The foreign depository can issue depository receipts by way of a public offering or private placement or in
any other manner prevalent in the permissible jurisdiction. A ‘permissible jurisdiction’ is defined as a foreign jurisdiction
which is a member of the Financial Action Task Force on Money Laundering and whose securities regulator is a member of the International
Organization of Securities Commissions.



In terms of the DR Scheme, securities
can be issued through the depository receipt mechanism up to such a limit that the aggregate underlying securities issued to foreign
depositories for issuance of depository receipts along with securities already held by persons resident outside India does not
exceed the applicable foreign investment limits prescribed by regulations framed under the Foreign Exchange Management Act, 1999.
The depository receipts and the underlying securities may be converted into each other subject to the applicable foreign investment
limit.



The DR Scheme provides that underlying
securities shall not be issued to a foreign depository for issuance of depository receipts at a price which is less than the price
applicable to a corresponding mode of issuance to domestic investors.



In terms of the DR Scheme, the foreign
depository is entitled to exercise voting rights, if any, associated with the underlying securities whether pursuant to voting
instructions from the holder of depository receipts or otherwise. Further, a holder of depository receipts issued against underlying
equity shares shall have the same obligations as if it is the holder of the equity shares if it has the right to issue voting instruction.



A person will be eligible to issue or
transfer eligible securities to a foreign depository, for the purpose of issuance of depository receipts as provided in the DR
Scheme and guidelines issued by the Government of India thereunder from time to time.



TAXATION



Indian Taxation



General. The following summary
is based on the law and practice of the Income-tax Act, 1961, or Income-tax Act, including the special tax regime contained in
Sections 115AC and 115ACA of the Income-tax Act read with the Issue of Foreign Currency Convertible Bonds and Ordinary Shares (through
Depository Receipt Mechanism) Scheme, 1993, or the Scheme, as amended.



The Income-tax Act is amended every year
by the Finance Act of the relevant year. Some or all of the tax consequences of Sections 115AC and 115ACA may be amended or changed
by future amendments to the Income-tax Act.



We believe this information is materially
complete as of the date hereof. However, these details are not intended to constitute a complete analysis of the individual tax
consequences to non-resident holders or employees under Indian law for the acquisition, ownership and sale of ADSs and equity shares.



EACH INVESTOR OR PROSPECTIVE INVESTOR
SHOULD CONSULT HIS, HER OR ITS OWN TAX ADVISORS WITH RESPECT TO INDIAN AND LOCAL TAX CONSEQUENCES OF ACQUIRING, OWNING OR DISPOSING
OF EQUITY SHARES OR ADSs.



Residence. For purposes of the
Income-tax Act, an individual is considered to be a resident of India during any fiscal year if he or she is in India in that year
for a period or periods amounting to at least 182 days; or at least 60 days and, within the four preceding years has been in India
for a period or periods amounting to at least 365 days.



The period of 60 days referred to above
shall be read as 182 days (i) in case of a citizen of India who leaves India in a previous year for the purposes of employment
outside of India or (ii) in the case of a citizen of India or a person of Indian origin living abroad who visits India.



A company
is a resident of India if it is incorporated in India or the control and the management of its affairs is situated wholly in India.
Individuals and companies that do not fulfil the above criteria would be treated as non-residents
for purposes of the Income-tax Act. The Finance Act, 2015hasamended this definition and brought in the concept of Place of Effective Management (PoEM) i.e., a company would be considered
a resident in India if its place of effective management in that year is in India. Thus a foreign company will be resident in
India, if its PoEM in that year is in India. The term ‘PoEM’ has been explained to mean a place where key management
and commercial decisions that are necessary for the conduct of the business of an entity as a whole, are in substance made. PoEM
is an internationally recognized concept and accepted even by the OECD. The Finance Act 2016 has deferred the applicability of
PoEM by one year and accordingly it shall be applicable from Financial Year 2016-17 onwards. Further to the amended definition,
the Ministry of Finance issued draft guidelines for determining PoEM of a company on December 23, 2015. The final guidelines for
determining PoEM are yet to be notified. This may increase the compliance of filing of returns and assessment of our subsidiary
company situated outside India.



Taxation of Distributions.Dividend income is currently exempt from tax for shareholders. The effective rate of DDT payable by the company is currently 20.3576%.
Any distributions of additional ADSs or equity shares to resident or non-resident holders will not be subject to Indian tax. The
Finance Act 2016 has provided that any income earned by an individual, HUF or a firm, who is a resident in India, by way of dividend
declared, distributed or paid by any domestic company in excess of10
lacs in aggregate shall be chargeable to tax at the rate of 10% on gross basis on such amount exceeding 10 lacs.





Minimum Alternate Tax. Section
115JA of the Income Tax Act which came into effect in April 1, 1997, brought certain zero tax companies under the ambit of a Minimum
Alternate Tax, or MAT. Effective April 1, 2000, Finance Act, 2000 introduced Section 115JB, under which the income of companies
eligible for tax holiday under section 10A of the Act was exempted from MAT. The amount of income to which any of the provisions
of section 10A apply, was reduced from the book profit for the purposes of calculation of income tax payable under the aforesaid
section. The Finance Act, 2007 included income eligible for deductions under section 10A of the Act in the computation of book
profits for the levy of MAT. However, income earned by SEZ developers and units operating in SEZ were kept out of computation of
book profit subjected to MAT. Effective April 1, 2011, the Finance Act, 2011 extended MAT to SEZ units and SEZ developer units.
Income in respect of which a deduction may be claimed under section 10AA or section 80IAB of the Indian Income Tax Act therefore
has to be included in book profits for computing MAT liability.



The Finance Act, 2015 had increased the
surcharge to 12% from 10% which has resulted in the increase in the effective rate of MAT to 21.3416% from 20.9605%.



The Income Tax Act provides that the
MAT paid by companies can be adjusted against its tax liability over the next ten years.



Taxation of Employee Stock Options.
Through the Finance Act, 2009, Section 17 (2) of the Income Tax Act was amended to provide that any specified securities or sweat
equity shares allotted or transferred, directly or indirectly, by a company free of cost or at concessional rate to its current
or former employees are taxable in the hands of employees as a “perquisite”. This treatment extends to all options
granted under a company’s stock option plan, where such option is exercised on or after April 1, 2009. The value of the perquisite
is the fair market value, or FMV, of the specified security or share as on the date of exercise of the option by the employee as
reduced by the amount actually paid by, or recovered from the employee in respect of such security or share. The value of the perquisite
so computed is added to the income chargeable to tax in the hands of the employee under the head “salaries” and subject
to tax at the rate applicable to the individual employee. Securities or sweat equity shares allotted or transferred by a company
free of cost or at concessional rate to its employees were earlier subject to a fringe benefit tax, which now stands abolished.



Taxation of Capital Gains. The
following is a brief summary of capital gains taxation of non-resident holders and resident employees relating to the sale of ADSs
and equity shares received upon conversion of ADSs. The relevant provisions are contained mainly in sections 45, 47(viia), 115AC
and 115ACA, of the Income-tax Act, in conjunction with the Scheme.



Effective April 1, 2001, the Finance
Act, 2001 introduced a new section 115AC in place of the prevailing section 115AC of the Income-tax Act. You should consult your
own tax advisor concerning the tax consequences of your particular situation.



Shares (including shares issuable on
the conversion of the ADSs) held by the non-resident investor for a period of more than 12 months is treated as long term capital
assets. If the shares are held for a period of less than 12 months from the date of conversion, the same is treated as short term
capital asset.



Capital gains are taxed as follows:



|· | As per the applicable scheme, gains from a sale of ADSs outside India by a non-resident to another non-resident are not taxable in India;
|- | -----------------------------------------------------------------------------------------------------------------------------------------



|· | Long-term capital gains realized by a resident from the transfer of the ADSs will be subject to tax at the rate of 10% excluding the applicable surcharge and education cess; short-term capital gains on such a transfer will be taxed at graduated rates with a maximum of 30%, excluding the applicable surcharge and education cess;
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | Long-term capital gains realized by a non-resident upon the sale of equity shares obtained from the conversion of ADSs are subject to tax at a rate of 10% excluding the applicable surcharge and education cess; and short-term capital gains on such a transfer will be taxed at the rate of tax applicable to the seller;
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | Long-term capital gain realized by a non-resident upon the sale of equity shares obtained from the conversion of ADSs is exempt from tax if the sale of such shares is made on a recognized stock exchange and Securities Transaction Tax, or STT (described below) is paid; and
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | Any short term capital gain is taxed at 15% excluding the applicable surcharge and education cess, if the sale of such equity shares is settled on a recognized stock exchange and STT is paid on such sale.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



As per the Finance Act, 2015, the rate
of surcharge for domestic companies having total taxable income exceeding 10,000,000 but not exceeding 100,000,000 is 7% and in
the case of domestic companies whose total taxable income is greater than 100,000,000, the applicable surcharge is 12%. For foreign
companies, the rate of surcharge is 2% if the total taxable income exceeds 10,000,000 but does not exceed 100,000,000 and it is
5% if the total taxable income of the foreign company exceeds 100,000,000.



Since October 1, 2004, with respect to
a sale and purchase of equity shares entered into on a recognized stock exchange, (i) both the buyer and seller are required to
pay a Securities Transaction Tax (STT) at the rate of 0.1% of the transaction value of the securities, if the transaction is a
delivery based transaction, i.e. the transaction involves actual delivery or transfer of shares; the rate of 0.1% has been substituted
for 0.125% by the Finance Act, 2012 w.e.f. July 1, 2012; (ii) the seller of the shares is required to pay a STT at the rate of
0.025% of the transaction value of the securities if the transaction is a non-delivery based transaction, i.e. a transaction settled
without taking delivery of the shares. STT is leviable with respect to a sale and purchase of a derivative and the rates of STT
as substituted by Finance Act, 2008 w.e.f. June 1, 2008 is as follows: (i) in case of sale of an option in securities, the seller
is required to pay an STT at the rate of 0.017% of the option premium; (ii) in case of a sale of an option in securities, where
the option is exercised, the buyer is required to pay a STT at the rate of 0.125% of the settlement price; and (iii) in case of
sale of futures in securities, the seller is required to pay STT at 0.017% on transaction value. This rate of 0.017% was changed
to 0.01% in the Finance Act, 2013. The Finance Act 2016 has increased the rate of STT on sale of an option in securities where option is not
exercised to 0.05% from 0.017% per cent at present w.e.f 1st June 2016.



Any resulting taxes on capital gains
arising out of such transaction may be offset by the applicable credit mechanism allowed under double tax avoidance agreements.
The capital gains tax is computed by applying the appropriate tax rates to the difference between the sale price and the purchase
price of the ADSs or equity shares. Under the Scheme, the purchase price of equity shares in an Indian listed company received
in exchange for ADSs will be the market price of the underlying shares on the date that the Depositary gives notice to the custodian
of the delivery of the equity shares in exchange for the corresponding ADSs, or the “stepped up” basis purchase price.
The market price will be the price of the equity shares prevailing on the BSE or the NSE, as applicable.



There is no corresponding provision under
the Income-tax Act in relation to the “stepped up” basis for the purchase price of equity shares. However, to the best
of our knowledge, the tax department in India has not denied this benefit. In the event that the tax department denies this benefit,
the original purchase price of ADSs would be considered the purchase price for computing the capital gains tax.



According to the Scheme, a non-resident
holder’s holding period for the purposes of determining the applicable Indian capital gains tax rate relating to equity shares
received in exchange for ADSs commences on the date of the notice of the redemption by the Depositary to the custodian. However,
the Scheme does not address this issue in the case of resident employees, and it is therefore unclear when the holding period for
the purposes of determining capital gains tax commences for such a resident employee.



It is unclear whether section 115AC and
the Scheme are applicable to a non-resident who acquires equity shares outside India from a non-resident holder of equity shares
after receipt of the equity shares upon conversion of the ADSs.



It is unclear whether capital gains derived
from the sale of subscription rights or other rights by a non-resident holder not entitled to an exemption under a tax treaty will
be subject to Indian capital gains tax. If such subscription rights or other rights are deemed by the Indian tax authorities to
be situated within India, the gains realized on the sale of such subscription rights or other rights will be subject to Indian
taxation. The capital gains realized on the sale of such subscription rights or other rights, which will generally be in the nature
of short-term capital gains, will be subject to tax at



|· | a maximum rate of 40% excluding the applicable surcharge and education cess, in case of a foreign company, and                                                              
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|· | a
maximum rate of 30% excluding the applicable surcharge and education cess, in case of resident employees, and non-resident individuals
with taxable income over 10,00,000.



Withholding Tax on Capital Gains.Any taxable gain realized by a non-resident on the sale of ADSs or equity shares is to be withheld at the source by the buyer.
According to section 196C of the Income Tax Act, where any income by way of interest or dividends in respect of bonds or global
depository receipts referred to in section 115AC or by way of long-term capital gains arising from the transfer of such bonds or
global depository receipts is payable to a non-resident, the person responsible for making the payment shall, at the time of credit
of such income to the account of the payee or at the time of payment thereof in cash or by the issue of a cheque or draft or by
any other mode, whichever is earlier, deduct income tax thereon at the rate of ten per cent. However, as per the provisions of
Section 196D(2) of the Income Tax Act, no withholding tax is required to be deducted from any income by way of capital gains arising
to Foreign Institutional Investors as defined in Section 115AD of the Income Tax Act on the transfer of securities defined in Section
115AD of the Income Tax Act.



Buy-back of Securities. Indian companies
are not subject to any tax on the buy-back of their shares. However, the shareholders will be taxed on any resulting gains. Indian
companies would be required to deduct tax at source according to the capital gains tax liability of a non-resident shareholder.
Further in case of buy back of unlisted securities as per section 115QA, domestic companies are subject to tax on buy back of unlisted
securities. Correspondingly exemption to shareholder under section 10(34A) is provided.



Stamp Duty and Transfer Tax. A
transfer of ADSs is not subject to Indian stamp duty. A sale of equity shares in physical form by a non-resident holder will be
subject to Indian stamp duty at the rate of 0.25% of the market value of the equity shares on the trade date, although customarily
such tax is borne by the transferee. Shares must be traded in dematerialized form. The transfer of shares in dematerialized form
is currently not subject to stamp duty.



Service Tax. Brokerage or commission
paid to stock brokers in connection with the sale or purchase of shares is subject to a service tax of 12.36%, including surcharges
and cess. The stock broker is responsible for collecting the service tax from the shareholder and paying it to the relevant authority.
Further the Finance Act 2016 has introduced Krishi Kalyan Cess (KKC) effective June 1, 2016 at the rate of
0.5%. Consequently, the service tax rate would be 15% including surcharges and cess.



Material U.S. Federal Income and Estate
Tax Consequences



The following is a summary of the material
U.S. federal income and estate tax consequences that may be relevant with respect to the ownership and disposition of equity shares
or ADSs and is for general information only. This summary addresses the U.S. federal income and estate tax considerations of holders
that are U.S. holders. U.S. holders are beneficial holders of equity shares or ADSs who are individual citizens or residents of
the United States; corporations (or other entities treated as corporations for U.S. federal tax purposes) created in or under the
laws of the United States or any state thereof (or the District of Columbia); estates, the income of which is subject to U.S. federal
income taxation regardless of its source, and trusts for which a U.S. court exercises primary supervision and a U.S. person has
the authority to control all substantial decisions or that has a valid election under applicable U.S. Treasury Regulations to be
treated as a U.S. person. This summary is limited to U.S. holders who will hold equity shares or ADSs as capital assets for U.S.
federal income tax purposes (generally for investment). In addition, this summary is limited to U.S. holders who are not resident
in India for purposes of the Convention between the Government of the United States of America and the Government of the Republic
of India for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income (the “Treaty”).
If a partnership, including any entity treated as a partnership for U.S. federal income tax purposes, holds the equity shares or
ADSs, the tax treatment of a partner will generally depend upon the status of the partner and upon the activities of the partnership.
A partner in a partnership holding equity shares or ADSs should consult his, her or its own tax advisor regarding the tax treatment
of an investment in the equity shares or ADSs.



This summary does not address tax considerations
applicable to holders that may be subject to special tax rules, such as banks, insurance companies, financial institutions, dealers
in securities or currencies, tax-exempt entities, persons that will hold equity shares or ADSs as a position in a ‘straddle’
or as part of a ‘hedging’ or ‘conversion’ transaction for tax purposes, persons that have a ‘functional
currency’ other than the U.S. dollar or holders of 10% or more, by voting power or value, of the shares of our company. This
summary is based on the Internal Revenue Code of 1986, as amended and as in effect on the date of this Annual Report on Form 20-F
and on U.S. Treasury Regulations in effect or, in some cases, proposed, as of the date of this Annual Report on Form 20-F, as well
as judicial and administrative interpretations thereof available on or before such date, and is based in part on the assumption
that each obligation in the deposit agreement and any related agreement will be performed in accordance with its terms. All of
the foregoing are subject to change, which change could apply retroactively, or the Internal Revenue Service may interpret existing
authorities differently, and a court may sustain such an interpretation any of which could affect the tax consequences described
below. This summary does not address U.S. federal tax laws other than income or estate tax or any U.S. state or local or non-U.S.
tax laws.



EACH INVESTOR OR PROSPECTIVE INVESTOR
SHOULD CONSULT HIS, HER OR ITS OWN TAX ADVISOR WITH RESPECT TO THE U.S. FEDERAL, STATE, LOCAL AND NON-U.S. TAX CONSEQUENCES OF
ACQUIRING, OWNING OR DISPOSING OF EQUITY SHARES OR ADSs.



Ownership of ADSs. For U.S. federal
income tax purposes, holders of ADSs will generally be treated as the holders of equity shares represented by such ADSs.



Dividends. Subject to the passive
foreign investment company rules described below, the gross amount of any distributions of cash (or the fair market value of any
other property) with respect to ADSs or equity shares (before reduction for any Indian withholding taxes) generally will be included
in income by a U.S. holder as ordinary dividend income at the time of receipt, which in the case of a U.S. holder of ADSs generally
should be the date of receipt by the Depositary, to the extent such distributions are made from the current or accumulated earnings
and profits (as determined under U.S. federal income tax principles) of our company. We do not expect to keep earnings and profits
in accordance with U.S. federal income tax principles; therefore, U.S. holders should expect that a distribution will generally
be treated as a dividend. Such dividends will not be eligible for the dividends received deduction generally allowed to corporate
U.S. holders. To the extent, if any, that the amount of any distribution by our company exceeds our company’s current and
accumulated earnings and profits (as determined under U.S. federal income tax principles) such excess will be treated first as
a tax-free return of capital to the extent of the U.S. holder’s tax basis in the equity shares or ADSs, and thereafter as
capital gain. Subject to certain limitations, dividends paid to non-corporate U.S. holders, including individuals, may be eligible
for a reduced rate of taxation if we are deemed to be a ‘qualified foreign corporation’ for U.S. federal income tax
purposes. A qualified foreign corporation includes a foreign corporation if (1) its shares (or, according to legislative history,
its ADSs) are readily tradable on an established securities market in the United States or (2) it is eligible for the benefits
under a comprehensive income tax treaty with the United States. In addition, a corporation is not a qualified foreign corporation
if it is or has been a passive foreign investment company (as discussed below) for the taxable year in which the dividend is paid
or in the preceding taxable year. The ADSs are traded on the NYSE. Due to the absence of specific statutory provisions addressing
ADSs, however, there can be no assurance that we are a qualified foreign corporation solely as a result of our listing on NYSE.
Nonetheless, we may be eligible for benefits under the Treaty. Each U.S. holder should consult its own tax advisor regarding the
treatment of dividends and such holder’s eligibility for a reduced rate of taxation.



Subject to certain conditions and limitations,
any Indian withholding tax imposed upon distributions paid to a U.S. holder with respect to ADSs or equity shares should be eligible
for credit against the U.S. holder’s federal income tax liability. Alternatively, a U.S. holder may claim a deduction for
such amount, but only for a year in which a U.S. holder does not claim a U.S. foreign tax credit with respect to any foreign income
taxes. The overall limitation on foreign taxes eligible for credit is calculated separately with respect to specific classes of
income. For this purpose, distributions on ADSs or ordinary shares generally will be foreign source income for purposes of computing
the U.S. foreign tax credit allowable to a U.S. holder. . The rules governing U.S. foreign tax credits are very complex and each
U.S. holder should consult its own tax advisor regarding the availability of foreign tax credits under such holder’s particular
circumstances.



If dividends are paid in Indian rupees,
the amount of the dividend distribution included in the income of a U.S. holder will be in the U.S. dollar value of the payments
made in Indian rupees, determined at a spot exchange rate between Indian rupees and U.S. dollars on the date such dividend is included
in the income of the U.S. holder, regardless of whether the payment is in fact converted into U.S. dollars. Generally, gain or
loss, if any, resulting from currency exchange fluctuations during the period from the date the dividend is paid to the date such
payment is converted into U.S. dollars will be treated as U.S. source ordinary income or loss.



Sale or exchange of equity
shares or ADSs. Subject to the passive foreign investment company rules described below, a U.S. holder generally will
recognize gain or loss on the sale or exchange of equity shares or ADSs equal to the difference between the amount realized
on such sale or exchange and the U.S. holder’s adjusted tax basis in the equity shares or ADSs, as the case may be.
Such gain or loss will be capital gain or loss, and will be long-term capital gain or loss if the equity shares or ADSs, as
the case may be, were held for more than one year. Furthermore, any such gain or loss recognized by a U.S. holder generally
will be treated as U.S. source passive category income or loss for U.S. foreign tax credit purposes. The sale of equity
shares or ADSs by a U.S. holder may be subject to certain taxes in India. See the section titled “Taxation - Indian
Taxation - Taxation of Capital Gains” in Item 10 of this Annual Report for additional information Due to limitations on
the use of foreign tax credits, however, a U.S. holder may not be able to utilize such taxes as a credit against the U.S.
holder’s federal income tax liability resulting from such sale.



Estate taxes. An individual U.S.
holder will have the value of the equity shares or ADSs held by such holder included in his or her gross estate for U.S. federal
estate tax purposes. An individual holder who actually pays Indian estate tax with respect to the equity shares may, however, be
entitled to credit the amount of such tax against his or her U.S. federal estate tax liability, subject to a number of conditions
and limitations.



Additional Tax on Investment Income.U.S. holders that are individuals, estates or trusts and whose income exceeds certain thresholds are subject to a 3.8% tax
on certain net investment income, including, among other things, dividends on, and capital gains from the sale or other taxable
disposition of, equity shares or ADSs, subject to certain limitations and exceptions.



Backup withholding tax and information
reporting requirements. Any dividends paid on, or proceeds from a sale of, equity shares or ADSs to or by a U.S. holder may
be subject to U.S. information reporting, and a backup withholding tax may apply unless the holder is an exempt recipient or provides
a U.S. taxpayer identification number and certifies under penalty of perjury that such number is correct and that such holder is
not subject to backup withholding and otherwise complies with any applicable backup withholding requirements. Any amount withheld
under the backup withholding rules will be allowed as a refund or credit against the holder’s U.S. federal income tax liability,
provided that the required information is timely furnished to the Internal Revenue Service.



Certain U.S. holders are required to
report information with respect to their investment in equity shares or ADSs not held through a custodial account with a U.S. financial
institution on Internal Revenue Service Form 8938, which must be attached to the U.S. holder’s annual income tax return.
Investors who fail to report the required information could become subject to substantial penalties. Each U.S. holder should consult
his, her or its own tax advisor concerning its obligation to file Internal Revenue Service Form 8938.



Passive foreign investment company.A non-U.S. corporation generally will be classified as a passive foreign investment company for U.S. federal income tax purposes
if either:



|· | 75% or more of its gross income for the taxable year is passive income;
or
|- | --------------------------------------------------------------------------

|· | on average for the taxable year, 50% or more
of the value of its assets (as of the end of each quarter of its taxable year) is attributable to assets that produce or are held
for the production of passive income.
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



We do not believe that we satisfy either
of the tests for passive foreign investment company status for Fiscal 2016. Because this determination is made on an annual basis,
however, no assurance can be given that we will not be considered a passive foreign investment company in future taxable years.
If we were to be a passive foreign investment company for any taxable year, U.S. holders:



|· | may be required to pay an interest charge together with tax calculated at ordinary income rates on ‘excess distributions,’ as the term is defined in relevant provisions of the U.S. tax laws and on any gain on a sale or other disposition of equity shares;
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | would be able to avoid the ‘excess distribution’ rules described above by making a “qualified electing fund election” (as the term is defined in relevant provisions of the U.S. tax laws) and including in their taxable income their pro-rata share of undistributed amounts of our income, however we do not plan to provide information necessary for U.S. holders to make a ‘qualified electing fund’ election; or
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | may avoid the ‘excess distribution’ rules described above if the applicable equity shares or ADSs are ‘marketable’ by making a mark-to-market election, in which case the U.S. holder must mark-to-market the equity shares or ADSs each taxable year and recognize ordinary gain and, to the extent of prior ordinary gain, ordinary loss for the increase or decrease in market value for such taxable year. Our ADSs are traded on the NYSE and our equity shares are traded on the National Stock Exchange and Bombay Stock Exchange.  As such, a U.S. holder may be able to make a mark-to-market election with respect to our ADSs or equity shares; and
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | will generally be subject to additional annual return requirements and may be required to file Internal Revenue Service Form 8621, unless certain exemptions apply.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------



THE ABOVE SUMMARY IS NOT INTENDED
TO CONSTITUTE A COMPLETE ANALYSIS OF ALL TAX CONSEQUENCES RELATING TO THE OWNERSHIP AND DISPOSITION OF EQUITY SHARES OR ADSs. YOU
SHOULD CONSULT YOUR OWN TAX ADVISOR CONCERNING THE RELEVANT TAX CONSEQUENCES TO YOU BASED ON YOUR PARTICULAR SITUATION.



DOCUMENTS ON DISPLAY



This report and other information filed
or to be filed by Infosys Limited can be inspected and copied at the public reference facilities maintained by the SEC at 100 F
Street, N.E., Washington, D.C. 20459.



The SEC maintains a website at www.sec.gov
that contains reports, proxy and information statements, and other information regarding registrants that make electronic filings
with the SEC using its EDGAR system.



Additionally, documents referred to in
this Form 20-F may be inspected at our corporate offices which are located at Electronics City, Hosur Road, Bangalore -560 100.



Item 11. Quantitative and Qualitative
Disclosures about Market Risk



This information is set forth under the
section titled	 ‘Operating and Financial Review and Prospects’ is as set out above in this Annual Report on Form
20-F and such information is incorporated herein by reference.



Item 12. Description of Securities
Other Than Equity Securities Fees and charges payable by holders of our ADSs



The fees and charges payable by holders
of our ADSs include the following:





|i. | a fee not in excess of U.S.$0.05 per ADS is charged for each issuance of ADSs including issuances resulting from distributions of shares, share dividends, share splits, bonuses and rights distributions;
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|ii. | a fee not in excess of U.S.$0.05 per ADS is charged for each surrender of ADSs in exchange for the underlying deposited securities;
|--- | -----------------------------------------------------------------------------------------------------------------------------------



|iii. | a fee not in excess of U.S.$0.02 per ADS for each cash distribution pursuant to the deposit agreement; and
|---- | ----------------------------------------------------------------------------------------------------------



|iv. | a fee for the distribution of the deposited securities pursuant to the deposit agreement, such fee being an amount equal to the fee for the execution and delivery of ADSs referred to in item (i) above which would have been charged as a result of the deposit of such securities, which were instead distributed by the depositary to ADS holders.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Additionally, under the terms of our
deposit agreement, the depositary is entitled to charge each registered holder the following:



|i. | taxes and other governmental charges incurred by the depositary or the custodian on any ADS or an equity share underlying an ADS;
|-- | ---------------------------------------------------------------------------------------------------------------------------------



|ii. | transfer or registration fees for the registration or transfer of deposited securities on any applicable register in connection with the deposit or withdrawal of deposited securities, including those of a central depository for securities (where applicable);
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|iii. | any cable, telex, facsimile transmission and delivery expenses incurred by the depositary; and
|---- | ----------------------------------------------------------------------------------------------



|iv. | customary expenses incurred by the depositary in the conversion of foreign currency, including, without limitation, expenses incurred on behalf of registered holders in connection with compliance with foreign exchange control restrictions and other applicable regulatory requirements.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In the case of cash distributions, fees
are generally deducted from the cash being distributed. Other fees may be collected from holders of ADSs in a manner determined
by the depositary with respect to ADSs registered in the name of investors (whether certificated or in book-entry form) and ADSs
held in brokerage and custodian accounts (via DTC). In the case of distributions other than cash (i.e., stock dividends, etc.),
the depositary charges the applicable ADS record date holder concurrent with the distribution. In the case of ADSs registered in
the name of the investor (whether certificated or in book-entry form), the depositary sends invoices to the applicable record date
ADS holders.



If any tax or other governmental charge
is payable by the holders and / or beneficial owners of ADSs to the depositary, the depositary, the custodian or we may withhold
or deduct from any distributions made in respect of deposited securities and may sell for the account of the holder and / or beneficial
owner any or all of the deposited securities and apply such distributions and sale proceeds in payment of such taxes (including
applicable interest and penalties) or charges, with the holder and the beneficial owner thereof remaining fully liable for any
deficiency.



Fees and other payments made by the
depositary









During fiscal 2016, expenses in an aggregate
amount of approximately $146,150 have been borne by the depositary in relation to our ADS program, including approximately:



|· | $134,800 towards payment
made to proxy processing firms for mailing the notice, proxy card and other interim communications to ADS holders or their brokers
including dividend re-investment and transfer fees.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|· | $ 11,350 towards payments
made to Ipreo for weekly and monthly Market intelligence ADR Reports.
|- | -----------------------------------------------------------------------------------------------



For the year ended March 31, 2016,
the Depositary has made payments to Infosys totaling to approximately $12 million (post deduction of withholding
tax) for investor relations activities related to the ADR program that took place in fiscal 2016 and fiscal 2015, including
the production of annual reports and Form 20-F filings, NYSE listing fees, road shows, production of investor targeting, peer
analysis, perception studies, postage for mailing annual and interim reports and other communications to ADR holders, participation in retail investor activities, broker conferences,  analyst events, etc.



Part II



Item 13. Defaults, Dividend Arrearages
and Delinquencies



None.



Item 14. Material Modifications to
the Rights of Security Holders and Use of Proceeds



None.



Item 15. Controls and Procedures



DISCLOSURE CONTROLS AND PROCEDURES



As of the end of the period covered by
this Annual Report on Form 20-F, our management, with the participation of our CEO and CFO, has carried out an evaluation of the
effectiveness of our disclosure controls and procedures. The term “disclosure controls and procedures” means controls
and other procedures that are designed to ensure that information required to be disclosed in the reports we file or submit under
the Securities Exchange Act of 1934, as amended, or the Exchange Act, is recorded, processed, summarized and reported, within the
time periods specified in the rules and forms of the SEC. Disclosure controls and procedures include, without limitation, controls
and procedures designed to ensure that information required to be disclosed by us in our reports that we file or submit under the
Exchange Act is accumulated and communicated to management, including our CEO and CFO, as appropriate to allow timely decisions
regarding our required disclosure. In designing and evaluating our disclosure controls and procedures, management recognizes that
any controls and procedures, no matter how well conceived and operated, can only provide reasonable assurance that the objectives
of the disclosure controls and procedures are met.



Based on their evaluation as of the end
of the period covered by this Annual Report on Form 20-F, our CEO and CFO have concluded that our disclosure controls and procedures
were effective to provide reasonable assurance that the information required to be disclosed in filings and submissions under the
Exchange Act, is recorded, processed, summarized, and reported within the time periods specified by the SEC’s rules and forms,
and that material information related to us and our consolidated subsidiaries is accumulated and communicated to management, including
the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions about required disclosure.



Management’s Annual Report on
Internal Control over Financial Reporting



Our management is responsible for establishing
and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange
Act. Our internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with International Financial Reporting
Standards (IFRS), as issued by the International Accounting Standards Board (IASB). Our internal control over financial reporting
includes those policies and procedures that:



|· | pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;
|- | ------------------------------------------------------------------------------------------------------------------------------------------------



|· | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with IFRS as issued by the IASB, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Because of its inherent limitations,
internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness
to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree
of compliance with the policies or procedures may deteriorate.



Management assessed the effectiveness
of our internal control over financial reporting as of March 31, 2016. In conducting its assessment of internal control over financial
reporting, management based its evaluation on the Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). Based on our assessment, management has concluded that our internal control over
financial reporting was effective as of March 31, 2016.



Our independent registered public accounting
firm, KPMG India, has audited the consolidated financial statements included in this Annual Report on Form 20-F, and as part of
their audit, has issued their report, included herein, on the effectiveness of our internal control over financial reporting as
of March 31, 2016.





Report of Independent Registered
Public Accounting Firm



The Board of Directors and Shareholders

Infosys Limited:



We have audited Infosys Limited’s internal
control over financial reporting as of March 31, 2016, based on criteria established inInternal Control – Integrated
Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Infosys Limited’s
management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness
of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control
Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting
based on our audit.



We conducted our audit in accordance with the
standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material
respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a
material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed
risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that
our audit provides a reasonable basis for our opinion.



A company’s internal control over financial
reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation
of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal
control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable
assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations
of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.



Because of its inherent limitations, internal
control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness
to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree
of compliance with the policies or procedures may deteriorate.



In our opinion, Infosys Limited maintained,
in all material respects, effective internal control over financial reporting as of March 31, 2016, based on criteria established
in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission
(COSO).



We also have audited, in accordance with the
standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Infosys Limited
and subsidiaries as of March 31, 2016 and 2015, and the related consolidated statements of comprehensive income, changes in equity,
and cash flows for each of the years in the three-year period ended March 31, 2016, and the related financial statement schedule
II and our report dated May 18, 2016 expressed an unqualified opinion on those consolidated financial statements and the financial
statement schedule II.





KPMG

Bangalore, India
May 18, 2016



CHANGES IN INTERNAL CONTROL OVER FINANCIAL
REPORTING



During the period covered by this Annual
Report on Form 20-F, there were no changes in our internal control over financial reporting that have materially affected or are
reasonably likely to materially affect our internal control over financial reporting.



Item 16A. Audit Committee Financial
Expert



Ms. Roopa Kudva is a member of our Board
and is a member of its Audit Committee and its Chairperson. Ms. Kudva is an “audit committee financial expert” as defined
in Item 16A of Form 20-F and is an independent director under applicable NYSE rules and Rule 10A-3 under the Exchange Act.



Item 16B. Code of Ethics



Our
Board has adopted the Code of Conduct and Ethics which is applicable to all officers, directors and employees and is posted on
our website at www.infosys.com. The Code of Conduct and Ethics has been filed previously as an exhibit to the Annual Report
on Form 20-F.



Our Whistleblower Policy has also been
filed previously as an exhibit to the Annual Report on Form 20-F. The Whistleblower Policy is posted on our website at www.infosys.com.



Item 16C. Principal Accountant Fees
and Services



The following table sets forth fees for
professional audit services for the audit of our annual financial statements, and fees for other services rendered by our principal
accountant and their associated entities for fiscal 2016 and 2015:

(Dollars in millions)

|Type of Service    | Fiscal 2016 | Fiscal 2015 | Description of Services                  
|------------------ | ----------- | ----------- | -----------------------------------------
|(a) Audit Fees     | 1.4         | 1.2         | Audit and review of financial statements 
|(b) Tax fees       | –           | 0.5         | Tax returns, filing and advisory services
|(c) All Other Fees | 0.3         | 0.1         | Due diligence and other advisory services
|Total              | 1.7         | 1.8         |                                          



Our Audit Committee charter requires
us to take the prior approval of our Audit Committee on every occasion we engage our principal accountants or their associated
entities to provide us any audit and non-audit services. We disclose to our Audit Committee the nature of services that will be
provided and the fees to be paid for the services. All of the audit and non-audit services provided by our principal accountants
or their associated entities in the previous two fiscal years have been pre-approved by our Audit Committee.



Item 16D. Exemptions from the Listing
Standards for Audit Committees



Not applicable.



Item 16E. Purchases of Equity Securities
by the Issuer and Affiliated Purchasers



None.



Item 16F. Change in Registrant’s
Certifying Accountant



Not applicable.



Item 16G. Corporate Governance



Section 303A of the Listed Company Manual
of the NYSE provides that a foreign private issuer may follow its home country practice in lieu of the requirements of Section
303A of the NYSE Listed Company Manual, provided that such foreign private issuer must:



|· | have an audit committee that satisfies the requirements of Rule 10A-3 under the Securities Exchange Act of 1934;
|- | ----------------------------------------------------------------------------------------------------------------



|· | disclose any significant ways in which its corporate governance practices differ from those followed by domestic companies under NYSE listing standards in its annual reports filed with the SEC on Form 20-F;
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|· | promptly notify the NYSE of non-compliance with Section 303A of the NYSE Listed Company Manual; and
|- | ---------------------------------------------------------------------------------------------------



|· | comply with the NYSE’s annual and interim certification requirements.
|- | ---------------------------------------------------------------------



Under
the Section 402.04 of the NYSE Listed Company Manual, actively operating companies that maintain a listing on the NYSE are required
to solicit proxies for all meetings of shareholders. However, Section 105 of the Indian Companies Act, 2013, prohibits a company
incorporated under that Act from soliciting proxies. Because we are prohibited from soliciting proxies under Indian law, we will
not meet the proxy solicitation requirement of Section 402.04 of the NYSE Listed Company Manual. However, as described above,
we give written notices of all our shareholder meetings to all the shareholders and we also file such notices with the SEC.



Under
our listing agreements with Indian stock exchanges, we have a Stakeholders Relationship Committee which is not a requirement under
the NYSE Listed Company Manual.





Item 16H. Mine Safety Disclosure



Not applicable.



Part III





Item 17. Financial statements



See Item 18.



Item 18. Financial statements



CONSOLIDATED STATEMENTS AND OTHER
FINANCIAL INFORMATION



Report
of the Audit Committee



To the Board of Directors and shareholders of Infosys Limited



In connection with the March 31, 2016
consolidated financial statements prepared under International Financial Reporting Standards as issued by the International Accounting
Standards Board, the Audit Committee:



|(1) |  | reviewed and discussed the consolidated financial statements with management;
|--- |  | -----------------------------------------------------------------------------



|(2) |  | discussed with the auditors the matters required by Statement on Auditing Standards
No. 61 as amended (AICPA, Professional Standards, Vol. 1 AU section 380), as adopted by the Public Company Accounting Oversight
Board in Rule 3200T; and
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(3) |  | received the written disclosures and the letter from the auditors required by applicable
requirements of the Public Company Accounting Oversight Board regarding the auditor’s communications with the audit committee
concerning independence, and has discussed with the auditor the auditor’s independence.
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Based upon these reviews and discussions,
the Audit Committee recommended to the Board of Directors that the audited consolidated financial statements be included in the
Annual Report on Form 20-F to be filed with the Securities and Exchange Commission of the United States of America.



|Bangalore, India
        May 18, 2016 | Roopa Kudva
        Chairperson and Audit Committee Financial Expert | R. Seshasayee
        Member, Audit committee | Prof. Jeffrey S. Lehman
        Member, Audit committee
|------------------------------------- | -------------------------------------------------------------------- | --------------------------------------------- | -------------------------------------------------------
|                                      |                                                                      |                                               |                                                        
|                                      | Ravi Venkatesan                                                      |                                               |                                                        
|                                      | Member, Audit committee                                              |                                               |                                                        



Report
of management



The management is responsible for preparing
the company's consolidated financial statements and related information that appears in this Annual Report. The management believes
that the consolidated financial statements fairly reflect the form and substance of transactions, and reasonably present the financial
condition and results of operations of Infosys Limited and subsidiaries in conformity with International Financial Reporting Standards
as issued by the International Accounting Standards Board. The management has included, in the company's consolidated financial
statements, amounts that are based on estimates and judgments, which it believes are reasonable under the circumstances.



The company maintains a system of internal
procedures and controls intended to provide reasonable assurance, at appropriate cost, that transactions are executed in accordance
with company authorization and are properly recorded and reported in the consolidated financial statements, and that assets are
adequately safeguarded.



KPMG has confirmed that it audits the
company's consolidated financial statements in accordance with the Standards of the Public Company Accounting Oversight Board (United
States).



The Board of Directors has appointed
an Audit Committee composed of outside directors. The committee meets with the management, internal auditors, and the independent
auditors to review internal accounting controls and accounting, auditing, and financial reporting matters.



|Bangalore, India
        May 18, 2016 | M. D. Ranganath
        Chief Financial Officer | Dr.Vishal Sikka
        Chief Executive Officer
|------------------------------------- | ----------------------------------------------- | -----------------------------------------------





Report of Independent Registered Public
Accounting Firm



The Board of Directors and Shareholders

Infosys Limited:



We have audited the accompanying consolidated
balance sheets of Infosys Limited and subsidiaries as of March 31, 2016 and 2015, and the related consolidated statements
of comprehensive income, changes in equity, and cash flows for each of the years in the three-year period ended March 31,
2016. In connection with our audits of the consolidated financial statements, we also have audited financial statement schedule
II (financial statement schedule). These consolidated financial statements and financial statement schedule are the responsibility
of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements and financial
statement schedule based on our audits.



We conducted our audits in accordance with the
standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis for our opinion.



In our opinion, the consolidated financial statements
referred to above present fairly, in all material respects, the financial position of Infosys Limited and subsidiaries as of March 31,
2016 and 2015, and the results of their operations and their cash flows for each of the years in the three-year period ended March 31,
2016, in conformity with the International Financial Reporting Standards as issued by the International Accounting Standards Board
(“IFRS”). Also in our opinion, the related financial statement schedule, when considered in relation to the basic consolidated
financial statements taken as a whole, presents fairly, in all material aspects, the information set forth therein.



We also have audited, in accordance with the
standards of the Public Company Accounting Oversight Board (United States), Infosys Limited’s internal control over financial
reporting as of March 31, 2016, based on criteria established in Internal Control – Integrated Framework (2013)
issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and our report dated May 18, 2016 expressed
an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.







KPMG

Bangalore, India
May 18, 2016
















Infosys Limited and subsidiaries



Consolidated Balance Sheets as of
March 31,

(Dollars in millions
except equity share data)

|                                                                                                                                                                                                                                                           | Note               | 2016    | 2015   
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------ | ------- | -------
|ASSETS                                                                                                                                                                                                                                                     |                    |         |        
|Current assets                                                                                                                                                                                                                                             |                    |         |        
|Cash and cash equivalents                                                                                                                                                                                                                                  | 2.1                | 4,935   | 4.859  
|Available-for-sale financial assets                                                                                                                                                                                                                        | 2.2                | 11      | 140    
|Trade receivables                                                                                                                                                                                                                                          |                    | 1,710   | 1,554  
|Unbilled revenue                                                                                                                                                                                                                                           |                    | 457     | 455    
|Prepayments and other current assets                                                                                                                                                                                                                       | 2.4                | 672     | 527    
|Derivative financial instruments                                                                                                                                                                                                                           | 2.7                | 17      | 16     
|Total current assets                                                                                                                                                                                                                                       |                    | 7,802   | 7,551  
|Non-current assets                                                                                                                                                                                                                                         |                    |         |        
|Property, plant and equipment                                                                                                                                                                                                                              | 2.5                | 1,589   | 1,460  
|Goodwill                                                                                                                                                                                                                                                   | 2.6                | 568     | 495    
|Intangible assets                                                                                                                                                                                                                                          | 2.6                | 149     | 102    
|Investment in associate                                                                                                                                                                                                                                    |                    | 16      | 15     
|Available-for-sale financial assets                                                                                                                                                                                                                        | 2.2                | 273     | 215    
|Deferred income tax assets                                                                                                                                                                                                                                 | 2.16               | 81      | 85     
|Income tax assets                                                                                                                                                                                                                                          | 2.16               | 789     | 654    
|Other non-current assets                                                                                                                                                                                                                                   | 2.4                | 111     | 38     
|Total non-current assets                                                                                                                                                                                                                                   |                    | 3,576   | 3,064  
|Total assets                                                                                                                                                                                                                                               |                    | 11,378  | 10,615 
|LIABILITIES AND EQUITY                                                                                                                                                                                                                                     |                    |         |        
|Current liabilities                                                                                                                                                                                                                                        |                    |         |        
|Trade payables                                                                                                                                                                                                                                             |                    | 58      | 22     
|Derivative financial instruments                                                                                                                                                                                                                           | 2.7                | 1       | –      
|Current income tax liabilities                                                                                                                                                                                                                             | 2.16               | 515     | 451    
|Client deposits                                                                                                                                                                                                                                            |                    | 4       | 4      
|Unearned revenue                                                                                                                                                                                                                                           |                    | 201     | 168    
|Employee benefit obligations                                                                                                                                                                                                                               |                    | 202     | 171    
|Provisions                                                                                                                                                                                                                                                 | 2.8                | 77      | 77     
|Other current liabilities                                                                                                                                                                                                                                  | 2.9                | 940     | 927    
|Total current liabilities                                                                                                                                                                                                                                  |                    | 1,998   | 1,820  
|Non-current liabilities                                                                                                                                                                                                                                    |                    |         |        
|Deferred income tax liabilities                                                                                                                                                                                                                            | 2.16               | 39      | 25     
|Other non-current liabilities                                                                                                                                                                                                                              | 2.9                | 17      | 8      
|Total liabilities                                                                                                                                                                                                                                          |                    | 2,054   | 1,853  
|Equity                                                                                                                                                                                                                                                     |                    |         |        
|Share capital - 5/- ($0.16) par value 2,400,000,000 (1,200,000,000) authorized equity shares, issued and outstanding 2,285,621,088 (1,142,805,132) equity shares, net of 11,323,576 (5,667,200) treasury shares each as of March 31, 2016 (March 31, 2015) |                    | 199     | 109    
|Share premium                                                                                                                                                                                                                                              |                    | 570     | 659    
|Retained earnings                                                                                                                                                                                                                                          |                    | 11,083  | 10,090 
|Other reserves                                                                                                                                                                                                                                             |                    | –       | –      
|Other components of equity                                                                                                                                                                                                                                 |                    | (2,528) | (2,096)
|Total equity attributable to equity holders of the company                                                                                                                                                                                                 |                    | 9,324   | 8,762  
|Non-controlling interests                                                                                                                                                                                                                                  |                    | –       | –      
|Total equity                                                                                                                                                                                                                                               |                    | 9,324   | 8,762  
|Total liabilities and equity                                                                                                                                                                                                                               |                    | 11,378  | 10,615 
|Commitments and contingent liabilities                                                                                                                                                                                                                     | 2.5, 2.8, and 2.16 |         |        



The accompanying notes form an integral
part of the consolidated financial statements.



Infosys Limited and subsidiaries



Consolidated Statements of Comprehensive
Income for the years ended March 31,



(Dollars in millions except equity share
and per equity share data)

|                                                                           | Note          | 2016          | 2015          | 2014         
|-------------------------------------------------------------------------- | ------------- | ------------- | ------------- | -------------
|Revenues                                                                   |               | 9,501         | 8,711         | 8,249        
|Cost of sales                                                              |               | 5,950         | 5,374         | 5,292        
|Gross profit                                                               |               | 3,551         | 3,337         | 2,957        
|Operating expenses:                                                        |               |               |               |              
|Selling and marketing expenses                                             |               | 522           | 480           | 431          
|Administrative expenses                                                    |               | 654           | 599           | 547          
|Total operating expenses                                                   |               | 1,176         | 1,079         | 978          
|Operating profit                                                           |               | 2,375         | 2,258         | 1,979        
|Other income, net                                                          | 2.13          | 476           | 560           | 440          
|Share in associate's profit / (loss)                                       |               | –             | –             | –            
|Profit before income taxes                                                 |               | 2,851         | 2,818         | 2,419        
|Income tax expense                                                         | 2.16          | 799           | 805           | 668          
|Net profit                                                                 |               | 2,052         | 2,013         | 1,751        
|Other comprehensive income                                                 |               |               |               |              
|Items that will not be reclassified to profit or loss:                     |               |               |               |              
|Remeasurements of the net defined benefit liability / asset                | 2.11 and 2.16 | (2)           | (8)           | –            
|Items that may be reclassified subsequently to profit or loss:             |               |               |               |              
|Fair value changes on available-for-sale financial assets                  | 2.2 and 2.16  | 6             | 14            | (17)         
|Exchange differences on translation of foreign operations                  |               | (436)         | (375)         | (616)        
|Total other comprehensive income, net of tax                               |               | (432)         | (369)         | (633)        
|Total comprehensive income                                                 |               | 1,620         | 1,644         | 1,118        
|Profit attributable to:                                                    |               |               |               |              
|Owners of the company                                                      |               | 2,052         | 2,013         | 1,751        
|Non-controlling interests                                                  |               | –             | –             | –            
|                                                                           |               | 2,052         | 2,013         | 1,751        
|Total comprehensive income attributable to:                                |               |               |               |              
|Owners of the company                                                      |               | 1,620         | 1,644         | 1,118        
|Non-controlling interests                                                  |               | –             | –             | –            
|                                                                           |               | 1,620         | 1,644         | 1,118        
|Earnings per equity share                                                  |               |               |               |              
|Basic ($)                                                                  |               | 0.90          | 0.88          | 0.77         
|Diluted ($)                                                                |               | 0.90          | 0.88          | 0.77         
|Weighted average equity shares used in computing earnings per equity share | 2.17          |               |               |              
|Basic                                                                      |               | 2,285,616,160 | 2,285,610,264 | 2,285,610,264
|Diluted                                                                    |               | 2,285,718,894 | 2,285,642,940 | 2,285,610,264



The accompanying notes form an integral
part of the consolidated financial statements.



Infosys Limited and subsidiaries



Consolidated Statements of Changes
in Equity

(Dollars in millions except equity
share data)

|                                                                                                            | Shares (2)    | Share capital | Share premium | Retained earnings | Other Reserves | Other components of equity | Total equity attributable to equity holders of the company
|----------------------------------------------------------------------------------------------------------- | ------------- | ------------- | ------------- | ----------------- | -------------- | -------------------------- | ----------------------------------------------------------
|Balance as of April 1, 2013                                                                                 | 571,402,566   | 64            | 704           | 7,666             | –              | (1,103)                    | 7,331                                                     
|Changes in equity for the year ended March 31, 2014                                                         |               |               |               |                   |                |                            |                                                           
|Remeasurement of the net defined benefit liability / asset, net of tax effect (Refer to Note 2.11 and 2.16) | –             | –             | –             | –                 | –              | –                          | –                                                         
|Dividends (including corporate dividend tax)                                                                | –             | –             | –             | (519)             | –              | –                          | (519)                                                     
|Change in accounting policy - Adoption of Revised IAS 19                                                    | –             | –             | –             | (6)               | –              | 9                          | 3                                                         
|Fair value changes on available-for-sale financial assets, net of tax effect (Refer to Note 2.2 and 2.16)   | –             | –             | –             | –                 | –              | (17)                       | (17)                                                      
|Net profit                                                                                                  | –             | –             | –             | 1,751             | –              | –                          | 1,751                                                     
|Exchange differences on translation of foreign operations                                                   | –             | –             | –             | –                 | –              | (616)                      | (616)                                                     
|Balance as of March 31, 2014                                                                                | 571,402,566   | 64            | 704           | 8,892             | –              | (1,727)                    | 7,933                                                     
|Changes in equity for the year ended March 31, 2015                                                         |               |               |               |                   |                |                            |                                                           
|Increase in
    share capital on account of bonus issue(1)(Refer to Note 2.12)                              | 571,402,566   | 45            | –             | –                 | –              | –                          | 45                                                        
|Amount utilized for bonus issue (1)
    (Refer to Note 2.12)                                                | –             | –             | (45)          | –                 | –              | –                          | (45)                                                      
|Remeasurement of the net defined benefit liability / asset, net of tax effect (Refer to Note 2.11 and 2.16) | –             | –             | –             | –                 | –              | (8)                        | (8)                                                       
|Dividends (including corporate dividend tax)                                                                | –             | –             | –             | (815)             | –              | –                          | (815)                                                     
|Fair value changes on available-for-sale financial assets, net of tax effect (Refer to Note 2.2 and 2.16)   | –             | –             | –             | –                 | –              | 14                         | 14                                                        
|Net profit                                                                                                  | –             | –             | –             | 2,013             | –              | –                          | 2,013                                                     
|Exchange differences on translation of foreign operations                                                   | –             | –             | –             | –                 | –              | (375)                      | (375)                                                     
|Balance as of March 31, 2015                                                                                | 1,142,805,132 | 109           | 659           | 10,090            | –              | (2,096)                    | 8,762                                                     
|Changes in equity for the year ended March 31, 2016                                                         |               |               |               |                   |                |                            |                                                           
|Shares issued on exercise of employee stock options                                                         | 10,824        | –             | –             | –                 | –              | –                          | –                                                         
|Increase in share capital on account of bonus issue(1)(Refer to Note 2.12)                                  | 1,142,805,132 | 90            | –             | –                 | –              | –                          | 90                                                        
|Amount utilized for bonus issue(1) (Refer to Note 2.12)                                                     | –             | –             | (90)          | –                 | –              | –                          | (90)                                                      
|Transfer to other reserves                                                                                  | –             | –             | –             | (89)              | 89             | –                          | –                                                         
|Transfer from other reserves on utilization                                                                 | –             | –             | –             | 89                | (89)           | –                          | –                                                         
|Employee stock compensation expense (refer to note 2.15)                                                    | –             | –             | 1             | –                 | –              | –                          | 1                                                         
|Remeasurement of the net defined benefit liability / asset, net of tax effect (Refer to Note 2.11 and 2.16) | –             | –             | –             | –                 | –              | (2)                        | (2)                                                       
|Dividends (including corporate dividend tax)                                                                | –             | –             | –             | (1,059)           | –              | –                          | (1,059)                                                   
|Fair value changes on available–for–sale financial assets, net of tax effect (Refer to Note 2.2 and 2.16)   | –             | –             | –             | –                 | –              | 6                          | 6                                                         
|Net profit                                                                                                  | –             | –             | –             | 2,052             | –              | –                          | 2,052                                                     
|Exchange differences on translation of foreign operations                                                   | –             | –             | –             | –                 | –              | (436)                      | (436)                                                     
|Balance as of March 31, 2016(3)                                                                             | 2,285,621,088 | 199           | 570           | 11,083            | –              | (2,528)                    | 9,324                                                     



|(1) | net
    of treasury shares                                                                                                                                                          
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | excludes
    treasury shares of 11,323,576 as of March 31, 2016, 5,667,200 as of March 31, 2015 and 2,833,600 as of March 31, 2014 and
    April 1, 2013, held by consolidated trust
|(3) | Balance
    in cash flow hedging reserve as on March 31, 2016 is Nil                                                                                                                



The accompanying notes form an integral part of the consolidated
financial statements



Infosys Limited and subsidiaries



Consolidated Statements of Cash Flows
for the years ended March 31,

(Dollars in millions)

|                                                                                                                               | Note        | 2016    | 2015    | 2014   
|------------------------------------------------------------------------------------------------------------------------------ | ----------- | ------- | ------- | -------
|Operating activities:                                                                                                          |             |         |         |        
|Net profit                                                                                                                     |             | 2,052   | 2,013   | 1,751  
|Adjustments to reconcile net profit to net cash provided by operating activities:                                              |             |         |         |        
|Depreciation and amortization                                                                                                  | 2.5 and 2.6 | 222     | 175     | 226    
|Income on available–for–sale financial assets and certificates of deposit                                                      |             | (27)    | (48)    | (44)   
|Income tax expense                                                                                                             | 2.16        | 799     | 805     | 668    
|Effect of exchange rate changes on assets and liabilities                                                                      |             | 10      | 15      | 8      
|Deferred purchase price                                                                                                        | 2.3         | 23      | 41      | 31     
|Provisions for doubtful trade receivable                                                                                       |             | (7)     | 29      | 23     
|Other adjustments                                                                                                              |             | 26      | 12      | 3      
|Changes in working capital                                                                                                     |             |         |         |        
|Trade receivables                                                                                                              |             | (225)   | (240)   | (232)  
|Prepayments and other assets                                                                                                   |             | (220)   | (81)    | (60)   
|Unbilled revenue                                                                                                               |             | (27)    | (6)     | (62)   
|Trade payables                                                                                                                 |             | 37      | (3)     | 5      
|Client deposits                                                                                                                |             | –       | (2)     | 1      
|Unearned revenue                                                                                                               |             | 43      | 45      | (27)   
|Other liabilities and provisions                                                                                               |             | 48      | 103     | 350    
|Cash generated from operations                                                                                                 |             | 2,754   | 2,858   | 2,641  
|Income taxes paid                                                                                                              | 2.16        | (892)   | (1,102) | (638)  
|Net cash provided by operating activities                                                                                      |             | 1,862   | 1,756   | 2,003  
|Investing activities:                                                                                                          |             |         |         |        
|Expenditure on property, plant and equipment, net of sale proceeds, including changes in retention money and capital creditors | 2.5 and 2.9 | (413)   | (367)   | (451)  
|Investment in associate                                                                                                        |             | –       | (15)    | –      
|Payment for acquisition of business, net of cash acquired                                                                      |             | (117)   | (206)   | –      
|Loans to employees                                                                                                             |             | (11)    | (1)     | (4)    
|Deposits placed with corporation                                                                                               |             | (22)    | (22)    | (37)   
|Income from available–for–sale financial assets and certificates of deposit                                                    |             | 26      | 54      | 33     
|Investment in quoted debt securities                                                                                           |             | (46)    | –       | (154)  
|Investment in certificates of deposit                                                                                          |             | –       | –       | (210)  
|Redemption of certificates of deposit                                                                                          |             | –       | 135     | 74     
|Investment in liquid mutual funds                                                                                              |             | (3,676) | (3,901) | (3,731)
|Redemption of liquid mutual funds                                                                                              |             | 3,795   | 4,098   | 3,681  
|Investment in fixed maturity plan securities                                                                                   |             | –       | (5)     | (24)   
|Redemption in fixed maturity plan securities                                                                                   |             | 5       | 25      | –      
|Investment in preference securities                                                                                            |             | (12)    | –       | –      
|Investment in other available–for–sale financial assets                                                                        |             | (3)     | –       | –      
|Net cash used in investing activities                                                                                          |             | (474)   | (205)   | (823)  
|Financing activities:                                                                                                          |             |         |         |        
|Payment of dividends (including corporate dividend tax)                                                                        |             | (1,059) | (815)   | (519)  
|Net cash used in financing activities                                                                                          |             | (1,059) | (815)   | (519)  
|Effect of exchange rate changes on cash and cash equivalents                                                                   |             | (253)   | (208)   | (351)  
|Net increase in cash and cash equivalents                                                                                      |             | 329     | 736     | 661    
|Cash and cash equivalents at the beginning                                                                                     | 2.1         | 4,859   | 4,331   | 4,021  
|Cash and cash equivalents at the end                                                                                           | 2.1         | 4,935   | 4,859   | 4,331  
|Supplementary information:                                                                                                     |             |         |         |        
|Restricted cash balance                                                                                                        | 2.1         | 74      | 58      | 53     



The accompanying notes form an integral
part of the consolidated financial statements



Notes to the Consolidated Financial
Statements



1. Company Overview and Significant
Accounting Policies



1.1 Company overview



Infosys is a leading provider of
consulting, technology, outsourcing and next-generation services. Along with its subsidiaries, Infosys provides Business IT
services (comprising application development and maintenance, independent validation, infrastructure management, engineering
services comprising product engineering and life cycle solutions and business process management); Consulting and systems
integration services (comprising consulting, enterprise solutions, systems integration and advanced technologies); Products,
business platforms and solutions to accelerate intellectual property-led innovation including Finacle, our banking solution;
and offerings in the areas of Analytics, Cloud, and Digital Transformation.



Infosys together with its subsidiaries
and controlled trusts is herein after referred to as the ”Group".



The company is a public limited company
incorporated and domiciled in India and has its registered office at Bangalore, Karnataka, India. The company has its primary listings
on the BSE Limited and National Stock Exchange in India. The company’s American Depositary Shares representing equity shares
are also listed on the New York Stock Exchange (NYSE), Euronext London and Euronext Paris.



The Group's consolidated financial statements
are authorized for issue by the company's Board of Directors on May 18, 2016.



1.2 Basis of preparation of financial
statements



These consolidated financial statements
have been prepared in compliance with International Financial Reporting Standards as issued by the International Accounting Standards
Board (IFRS), under the historical cost convention on the accrual basis except for certain financial instruments and prepaid gratuity
benefits which have been measured at fair values. Accounting policies have been applied consistently to all periods presented in
these consolidated financial statements.



As the quarter and year figures are taken
from the source and rounded to the nearest digits, the figures reported for all the quarters during the year might not always add
up to the year figures reported in this statement.



1.3 Basis of consolidation



Infosys consolidates entities which it
owns or controls. The consolidated financial statements comprise the financial statements of the company, its controlled trusts
and its subsidiaries as disclosed in Note 2.18. Control exists when the parent has power over the entity, is exposed, or has rights,
to variable returns from its involvement with the entity and has the ability to affect those returns by using its power over the
entity. Power is demonstrated through existing rights that give the ability to direct relevant activities, those which significantly
affect the entity's returns. Subsidiaries are consolidated from the date control commences until the date control ceases.



The financial statements of the Group
companies are consolidated on a line-by-line basis and intra-group balances and transactions including unrealized gain / loss from
such transactions are eliminated upon consolidation. These financial statements are prepared by applying uniform accounting policies
in use at the Group. Non-controlling interests which represent part of the net profit or loss and net assets of subsidiaries that
are not, directly or indirectly, owned or controlled by the company, are excluded.



Associates are entities over which the
group has significant influence but not control. Investments in associates are accounted for using the equity method of accounting.
The investment is initially recognized at cost, and the carrying amount is increased or decreased to recognize the investor’s
share of the profit or loss of the investee after the acquisition date. The group’s investment in associates includes goodwill
identified on acquisition.



1.4 Use of estimates



The preparation of the financial statements
in conformity with IFRS requires management to make estimates, judgments and assumptions. These estimates, judgments and assumptions
affect the application of accounting policies and the reported amounts of assets and liabilities, the disclosures of contingent
assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the period.
Application of accounting policies that require critical accounting estimates involving complex and subjective judgments and the
use of assumptions in these financial statements have been disclosed in Note 1.5. Accounting estimates could change from period
to period. Actual results could differ from those estimates. Appropriate changes in estimates are made as management becomes aware
of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the financial statements in the period
in which changes are made and, if material, their effects are disclosed in the notes to the consolidated financial statements.



1.5 Critical accounting estimates



a. Revenue recognition



The group uses the percentage-of-completion
method in accounting for its fixed-price contracts. Use of the percentage-of-completion method requires the group to estimate the
efforts or costs expended to date as a proportion of the total efforts or costs to be expended. Efforts or costs expended have
been used to measure progress towards completion as there is a direct relationship between input and productivity. Provisions for
estimated losses, if any, on uncompleted contracts are recorded in the period in which such losses become probable based on the
expected contract estimates at the reporting date.



b. Income taxes



The company's two major tax jurisdictions
are India and the U.S., though the company also files tax returns in other overseas jurisdictions. Significant judgments are involved
in determining the provision for income taxes, including amount expected to be paid/recovered for uncertain tax positions (also
refer to Note 2.16).



c. Business combinations and intangible
assets



Business combinations are accounted for
using IFRS 3 (Revised), Business Combinations. IFRS 3 requires the identifiable intangible assets and contingent consideration
to be fair valued in order to ascertain the net fair value of identifiable assets, liabilities and contingent liabilities of the
acquiree. Significant estimates are required to be made in determining the value of contingent consideration and intangible assets.
These valuations are conducted by independent valuation experts.



d. Property, plant and equipment



Property, plant and equipment represent
a significant proportion of the asset base of the Group. The charge in respect of periodic depreciation is derived after determining
an estimate of an asset’s expected useful life and the expected residual value at the end of its life. The useful lives and
residual values of the Group's assets are determined by management at the time the asset is acquired and reviewed periodically,
including at each financial year end. The lives are based on historical experience with similar assets as well as anticipation
of future events, which may impact their life, such as changes in technology.



e. Impairment of Goodwill



Goodwill is tested for impairment on
an annual basis and whenever there is an indication that the recoverable amount of a cash generating unit is less than its carrying
amount based on a number of factors including operating results, business plans, future cash flows and economic conditions. The
recoverable amount of cash generating units is determined based on higher of value-in-use and fair value less cost to sell. The
goodwill impairment test is performed at the level of the cash-generating unit or groups of cash-generating units which are benefitting
from the synergies of the acquisition and which represents the lowest level at which goodwill is monitored for internal management
purposes.



Market related information and estimates
are used to determine the recoverable amount. Key assumptions on which management has based its determination of recoverable amount
include estimated long term growth rates, weighted average cost of capital and estimated operating margins. Cash flow projections
take into account past experience and represent management’s best estimate about future developments.



1.6 Revenue recognition



The company derives revenues primarily
from software development and related services and from the licensing of software products. Arrangements with customers for software
related services are either on a fixed-price, fixed-timeframe or on a time-and-material basis.



Revenue on time-and-material
contracts are recognized as the related services are performed and revenue from the end of the last billing to the balance
sheet date is recognized as unbilled revenues. Revenue from fixed-price, fixed-timeframe contracts, where there is no
uncertainty as to measurement or collectability of consideration, is recognized as per the percentage-of-completion method.
When there is uncertainty as to measurement or ultimate collectability, revenue recognition is postponed until such
uncertainty is resolved. Efforts or costs expended have been used to measure progress towards completion as there is a direct
relationship between input and productivity. Provisions for estimated losses, if any, on uncompleted contracts are recorded
in the period in which such losses become probable based on the current contract estimates. Costs and earnings in excess of
billings are classified as unbilled revenue while billings in excess of costs and earnings are classified as unearned
revenue. Deferred contract costs are amortized over the term of the
contract. Maintenance revenue is recognized ratably over the term of the underlying maintenance arrangement.



In arrangements for software development
and related services and maintenance services, the company has applied the guidance in IAS 18, Revenue, by applying the revenue
recognition criteria for each separately identifiable component of a single transaction. The arrangements generally meet the criteria
for considering software development and related services as separately identifiable components. For allocating the consideration,
the company has measured the revenue in respect of each separable component of a transaction at its fair value, in accordance with
principles given in IAS 18. The price that is regularly charged for an item when sold separately is the best evidence of its fair
value. In cases where the company is unable to establish objective and reliable evidence of fair value for the software development
and related services, the company has used a residual method to allocate the arrangement consideration. In these cases the balance
of the consideration, after allocating the fair values of undelivered components of a transaction has been allocated to the delivered
components for which specific fair values do not exist.



License fee revenues are recognized when
the general revenue recognition criteria given in IAS 18 are met. Arrangements to deliver software products generally have three
elements: license, implementation and Annual Technical Services (ATS). The company has applied the principles given in IAS 18 to
account for revenues from these multiple element arrangements. Objective and reliable evidence of fair value has been established
for ATS. Objective and reliable evidence of fair value is the price charged when the element is sold separately. When other services
are provided in conjunction with the licensing arrangement and objective and reliable evidence of their fair values have been established,
the revenue from such contracts are allocated to each component of the contract in a manner, whereby revenue is deferred for the
undelivered services and the residual amounts are recognized as revenue for delivered elements. In the absence of objective and
reliable evidence of fair value for implementation, the entire arrangement fee for license and implementation is recognized using
the percentage-of-completion method as the implementation is performed. Revenue from client training, support and other services
arising due to the sale of software products is recognized as the services are performed. ATS revenue is recognized ratably over
the period in which the services are rendered.



Advances received for services and products
are reported as client deposits until all conditions for revenue recognition are met.



The company accounts for volume discounts
and pricing incentives to customers as a reduction of revenue based on the ratable allocation of the discounts/ incentives amount
to each of the underlying revenue transaction that results in progress by the customer towards earning the discount/ incentive.
Also, when the level of discount varies with increases in levels of revenue transactions, the company recognizes the liability
based on its estimate of the customer's future purchases. If it is probable that the criteria for the discount will not be met,
or if the amount thereof cannot be estimated reliably, then discount is not recognized until the payment is probable and the amount
can be estimated reliably. The company recognizes changes in the estimated amount of obligations for discounts in the period in
which the change occurs. The discounts are passed on to the customer either as direct payments or as a reduction of payments due
from the customer.



The company presents revenues net of
value-added taxes in its statement of comprehensive income.



1.7 Property, plant and equipment



Property, plant and equipment are stated
at cost, less accumulated depreciation and impairment, if any. Costs directly attributable to acquisition are capitalized until
the property, plant and equipment are ready for use, as intended by management. The group depreciates property, plant and equipment
over their estimated useful lives using the straight-line method. The estimated useful lives of assets are as follows:



|Buildings              | 22 - 25 years
|---------------------- | -------------
|Plant and machinery    | 5 years      
|Computer equipment     | 3-5 years    
|Furniture and fixtures | 5 years      
|Vehicles               | 5 years      



Depreciation methods, useful lives
and residual values are reviewed periodically, including at each financial year end. (Refer to note 2.5)



Advances paid towards the acquisition
of property, plant and equipment outstanding at each balance sheet date and the cost of assets not put to use before such date
are disclosed under ‘Capital work-in-progress’. Subsequent expenditures relating to property, plant and equipment is
capitalized only when it is probable that future economic benefits associated with these will flow to the Group and the cost of
the item can be measured reliably. Repairs and maintenance costs are recognized in net profit in the statement of comprehensive
income when incurred. The cost and related accumulated depreciation are eliminated from the financial statements upon sale or retirement
of the asset and the resultant gains or losses are recognized in net profit in the statement of comprehensive income. Assets to
be disposed of are reported at the lower of the carrying value or the fair value less cost to sell.



1.8 Business combinations



Business combinations have been accounted
for using the acquisition method under the provisions of IFRS 3 (Revised), Business Combinations.



The cost of an acquisition is measured
at the fair value of the assets transferred, equity instruments issued and liabilities incurred or assumed at the date of acquisition,
which is the date on which control is transferred to the Group. The cost of acquisition also includes the fair value of any contingent
consideration. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured
initially at their fair value on the date of acquisition.



Business combinations between entities
under common control is outside the scope of IFRS 3 (Revised), Business Combinations and is accounted for at carrying value.



Transaction costs that the Group incurs
in connection with a business combination such as finders’ fees, legal fees, due diligence fees, and other professional and
consulting fees are expensed as incurred.



1.9 Employee benefits



1.9.1 Gratuity



The Group provides for gratuity, a defined
benefit retirement plan ('the Gratuity Plan') covering eligible employees of Infosys and its Indian subsidiaries. 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 employee's salary and the tenure of employment with the Group.



Liabilities with regard to the Gratuity
Plan are determined by actuarial valuation, performed by an independent actuary, at each balance sheet date using the projected
unit credit method. The company fully contributes all ascertained liabilities to the Infosys Limited Employees' Gratuity Fund Trust
(the Trust). In case of Infosys BPO and EdgeVerve, contributions are made to the Infosys BPO's Employees' Gratuity Fund Trust and
EdgeVerve Systems Limited Employees' Gratuity Fund Trust, respectively. Trustees administer contributions made to the Trusts and
contributions are invested in a scheme with Life Insurance Corporation of India as permitted by law of India.



The Group recognizes the
net obligation of a defined benefit plan in its balance sheet as an asset or liability. Gains and losses through
re-measurements of the net defined benefit liability / asset are recognized in other comprehensive income. The actual return
of the portfolio of plan assets, in excess of the yields computed by applying the discount rate used to measure the defined
benefit obligation is recognized in other comprehensive income. The effect of any plan amendments are recognized in net
profits in the statement of comprehensive income.



1.9.2 Superannuation



Certain employees of Infosys, Infosys
BPO and EdgeVerve are participants in a defined contribution plan. The Group has no further obligations to the Plan beyond its
monthly contributions which are periodically contributed to a trust fund, the corpus of which is invested with the Life Insurance
Corporation of India.



1.9.3 Provident fund



Eligible employees of Infosys receive
benefits from a provident fund, which is a defined benefit plan. Both the eligible employee and the company make monthly contributions
to the provident fund plan equal to a specified percentage of the covered employee's salary. The company contributes a part of
the contributions to the Infosys Limited Employees' Provident Fund Trust. The trust invests in specific designated instruments
as permitted by Indian law. The remaining portion is contributed to the government administered pension fund. The rate at which
the annual interest is payable to the beneficiaries by the trust is being administered by the government. 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.



In respect of Indian subsidiaries, eligible
employees receive benefits from a provident fund, which is a defined contribution plan. Both the employee and the respective companies
make monthly contributions to this provident fund plan equal to a specified percentage of the covered employee's salary. Amounts
collected under the provident fund plan are deposited in a government administered provident fund. The companies have no further
obligation to the plan beyond their monthly contributions.



1.9.4 Compensated absences



The Group has a policy on compensated
absences which are both accumulating and non-accumulating in nature. The expected cost of accumulating compensated absences is
determined by actuarial valuation using projected unit credit method on the additional amount expected to be paid/availed as a
result of the unused entitlement that has accumulated at the balance sheet date. Expense on non-accumulating compensated absences
is recognized in the period in which the absences occur.



1.10 Share-based compensation



The Group recognizes compensation expense
relating to share-based payments in net profit using a fair-value measurement method in accordance with IFRS 2, Share-Based Payment.
The estimated fair value of awards is charged to income on a straight-line basis over the requisite service period for each separately
vesting portion of the award as if the award was in-substance, multiple awards with a corresponding increase to share premium.



1.11 Earnings per equity share



Basic earnings per equity share is computed
by dividing the net profit attributable to the equity holders of the company by the weighted average number of equity shares outstanding
during the period. Diluted earnings per equity share is computed by dividing the net profit attributable to the equity holders
of the company by the weighted average number of equity shares considered for deriving basic earnings per equity share and also
the weighted average number of equity shares that could have been issued upon conversion of all dilutive potential equity shares.
The dilutive potential equity shares are adjusted for the proceeds receivable had the equity shares been actually issued at fair
value (i.e. the average market value of the outstanding equity shares). Dilutive potential equity shares are deemed converted as
of the beginning of the period, unless issued at a later date. Dilutive potential equity shares are determined independently for
each period presented.



The number of equity shares and potentially
dilutive equity shares are adjusted retrospectively for all periods presented for any share splits and bonus shares issues including
for changes effected prior to the approval of the financial statements by the Board of Directors.



1.12 Goodwill



Goodwill represents the cost of business
acquisition in excess of the Group's interest in the net fair value of identifiable assets, liabilities and contingent liabilities
of the acquiree. When the net fair value of the identifiable assets, liabilities and contingent liabilities acquired exceeds the
cost of business acquisition, a gain is recognized immediately in net profit in the statement of comprehensive income. Goodwill
is measured at cost less accumulated impairment losses.



1.13 Intangible assets



Intangible assets are stated at cost
less accumulated amortization and impairment. Intangible assets are amortized over their respective individual estimated useful
lives on a straight-line basis, from the date that they are available for use. The estimated useful life of an identifiable intangible
asset is based on a number of factors including the effects of obsolescence, demand, competition, and other economic factors (such
as the stability of the industry, and known technological advances), and the level of maintenance expenditures required to obtain
the expected future cash flows from the asset. Amortization methods and useful lives are reviewed periodically including at each
financial year end.



Research costs are expensed as incurred.
Software product development costs are expensed as incurred unless technical and commercial feasibility of the project is demonstrated,
future economic benefits are probable, the company has an intention and ability to complete and use or sell the software and the
costs can be measured reliably. The costs which can be capitalized include the cost of material, direct labour, overhead costs
that are directly attributable to preparing the asset for its intended use. Research and development costs and software development
costs incurred under contractual arrangements with customers are accounted as cost of sales.



1.14 Financial instruments



Financial instruments of the Group are
classified in the following categories: non-derivative financial instruments comprising of loans and receivables, available-for-sale
financial assets and trade and other payables; derivative financial instruments; share capital and treasury shares. The classification
of financial instruments depends on the purpose for which those were acquired. Management determines the classification of its
financial instruments at initial recognition. Regular way purchase and sale of financial assets are accounted for at trade date.



a. Non-derivative financial instruments



i) Loans and receivables



Loans and receivables are non-derivative
financial assets with fixed or determinable payments that are not quoted in an active market. They are presented as current assets,
except for those maturing later than 12 months after the balance sheet date which are presented as non-current assets. Loans and
receivables are measured initially at fair value plus transaction costs and subsequently carried at amortized cost using the effective
interest method, less any impairment loss or provisions for doubtful accounts. Loans and receivables are represented by trade receivables,
net of allowances for impairment, unbilled revenue, cash and cash equivalents, prepayments, certificates of deposit, and other
assets. Cash and cash equivalents comprise cash and bank deposits and deposits with corporations. The company considers all highly
liquid investments with a remaining maturity at the date of purchase of three months or less and that are readily convertible to
known amounts of cash to be cash equivalents. Certificates of deposit is a negotiable money market instrument for funds deposited
at a bank for a specified time period. For these financial instruments, the carrying amounts
approximate fair value due to the short maturity of these instruments. Loans and receivables are reclassified to available-for-sale
financial assets when the financial asset becomes quoted in an active market.



(ii) Available-for-sale financial
assets



Available-for-sale financial assets are
non-derivatives that are either designated in this category or are not classified in any of the other categories. Available-for-sale
financial assets are recognized initially at fair value plus transactions costs. Subsequent to initial recognition these are measured
at fair value and changes therein, other than impairment losses and foreign exchange gains and losses on available-for-sale monetary
items are recognized directly in other comprehensive income. When an investment is derecognized, the cumulative gain or loss in
other comprehensive income is transferred to net profit in the statement of comprehensive income. These are presented as current
assets unless management intends to dispose of the assets after 12 months from the balance sheet date.



(iii) Trade and other payables



Trade and other payables are initially
recognized at fair value, and subsequently carried at amortized cost using the effective interest method. For trade and other payables
maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short maturity of
these instruments.



b. Derivative financial instruments



The group holds derivative financial
instruments such as foreign exchange forward and option contracts to mitigate the risk of changes in exchange rates on foreign
currency exposures. The counterparty for these contracts is a bank.



(i) Financial assets or financial
liabilities, at fair value through profit or loss.



This category has derivative financial
assets or liabilities which are not designated as hedges.



Although the group believes that these
derivatives constitute hedges from an economic perspective, they may not qualify for hedge accounting under IAS 39, Financial Instruments:
Recognition and Measurement. Any derivative that is either not designated as hedge, or is so designated but is ineffective as per
IAS 39, is categorized as a financial asset or financial liability, at fair value through profit or loss.



Derivatives not designated as hedges
are recognized initially at fair value and attributable transaction costs are recognized in net profit in the statement of comprehensive
income when incurred. Subsequent to initial recognition, these derivatives are measured at fair value through profit or loss and
the resulting exchange gains or losses are included in other income. Assets/ liabilities in this category are presented as current
assets/current liabilities if they are either held for trading or are expected to be realized within 12 months after the balance
sheet date.



(ii) Cash flow hedge



The group 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 hedging 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. Any ineffective portion of changes in the fair value of the derivative
is recognized immediately in the net profit in the statement of comprehensive income. If the hedging instrument no longer meets
the criteria for hedge accounting, then hedge accounting is discontinued prospectively. If the hedging instrument expires or is
sold, terminated or exercised, the cumulative gain or loss on the hedging instrument recognized in cash flow hedging reserve till
the period the hedge was effective remains in cash flow hedging reserve until the forecasted transaction occurs. The cumulative
gain or loss previously recognized in the cash flow hedging reserve is transferred to the net profit in the statement of comprehensive
income upon the occurrence of the related forecasted transaction. If the forecasted transaction is no longer expected to occur,
then the amount accumulated in cash flow hedging reserve is reclassified to net profit in the statement of comprehensive income.



c. Share capital and treasury shares



Ordinary Shares



Ordinary shares are classified as equity.
Incremental costs directly attributable to the issuance of new ordinary shares and share options are recognized as a deduction
from equity, net of any tax effects.



Treasury Shares



When any entity within the Group purchases
the company's ordinary shares, the consideration paid including any directly attributable incremental cost is presented as a deduction
from total equity, until they are cancelled, sold or reissued. When treasury shares are sold or reissued subsequently, the amount
received is recognized as an increase in equity, and the resulting surplus or deficit on the transaction is transferred to/ from
share premium.



1.15 Impairment



a. Financial assets



The Group assesses at each balance sheet
date whether there is objective evidence that a financial asset or a group of financial assets is impaired. A financial asset is
considered impaired if objective evidence indicates that one or more events have had a negative effect on the estimated future
cash flows of that asset. Individually significant financial assets are tested for impairment on an individual basis. The remaining
financial assets are assessed collectively in groups that share similar credit risk characteristics.



(i) Loans and receivables



Impairment loss in respect of loans and
receivables measured at amortized cost are calculated as the difference between their carrying amount, and the present value of
the estimated future cash flows discounted at the original effective interest rate. Such impairment loss is recognized in net profit
in the statement of comprehensive income.



(ii) Available-for-sale financial
assets



Significant or prolonged decline in the
fair value of the security below its cost and the disappearance of an active trading market for the security are objective evidence
that the security is impaired. An impairment loss in respect of an available-for-sale financial asset is calculated by reference
to its fair value and is recognized in net profit in the statement of comprehensive income. The cumulative loss that was recognized
in other comprehensive income is transferred to net profit in the statement of comprehensive income upon impairment.



b. Non-financial assets



(i) Goodwill



Goodwill is tested for impairment on
an annual basis and whenever there is an indication that goodwill may be impaired, relying on a number of factors including operating
results, business plans and future cash flows. For the purpose of impairment testing, goodwill acquired in a business combination
is allocated to the Group's cash generating units (CGU) or groups of CGU’s expected to benefit from the synergies arising
from the business combination. A CGU is the smallest identifiable group of assets that generates cash inflows that are largely
independent of the cash inflows from other assets or group of assets. Impairment occurs when the carrying amount of a CGU including
the goodwill, exceeds the estimated recoverable amount of the CGU. The recoverable amount of a CGU is the higher of its fair value
less cost to sell and its value-in-use. Value-in-use is the present value of future cash flows expected to be derived from the
CGU.



Total impairment loss of a CGU is allocated
first to reduce the carrying amount of goodwill allocated to the CGU and then to the other assets of the CGU pro-rata on the basis
of the carrying amount of each asset in the CGU. An impairment loss on goodwill is recognized in net profit in the statement of
comprehensive income and is not reversed in the subsequent period.



(ii) Intangible assets and
property, plant and equipment



Intangible assets and property, plant
and equipment are evaluated for recoverability whenever events or changes in circumstances indicate that their carrying amounts
may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost
to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash flows that are
largely independent of those from other assets. In such cases, the recoverable amount is determined for the CGU to which the asset
belongs.



If such assets are considered to be impaired,
the impairment to be recognized in net profit in the statement of comprehensive income is measured by the amount by which the carrying
value of the assets exceeds the estimated recoverable amount of the asset.



c. Reversal of impairment loss



An impairment loss for financial assets
is reversed if the reversal can be related objectively to an event occurring after the impairment loss was recognized. An impairment
loss in respect of goodwill is not reversed. In respect of other assets, an impairment loss is reversed if there has been a change
in the estimates used to determine the recoverable amount. The carrying amount of an asset other than goodwill is increased to
its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net
of any accumulated amortization or depreciation) had no impairment loss been recognized for the asset in prior years. A reversal
of impairment loss for an asset other than goodwill and available-for-sale financial assets that are equity securities is recognized
in net profit in the statement of comprehensive income. For available-for-sale financial assets that are equity securities, the
reversal is recognized in other comprehensive income.



1.16 Fair value of financial
instruments



In determining the fair value of its
financial instruments, the group uses a variety of methods and assumptions that are based on market conditions and risks existing
at each reporting date. The methods used to determine fair value include discounted cash flow analysis, available quoted market
prices and dealer quotes. All methods of assessing fair value result in general approximation of value, and such value may never
actually be realized.



For all other financial instruments,
the carrying amounts approximate fair value due to the short maturity of those instruments. The fair value of securities, which
do not have an active market and where it is not practicable to determine the fair values with sufficient reliability, are carried
at cost less impairment.



1.17 Provisions



A provision is recognized if, as a result
of a past event, the Group has a present legal or constructive obligation that is reasonably estimable, and it is probable that
an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected
future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific
to the liability.



a. Post sales client support



The group provides its clients with a
fixed-period post sales support for corrections of errors and support on all its fixed-price, fixed-timeframe contracts. Costs
associated with such support services are accrued at the time related revenues are recorded and included in cost of sales. The
group 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.



b. Onerous contracts



Provisions for onerous contracts are
recognized when the expected benefits to be derived by the Group from a contract are lower than the unavoidable costs of meeting
the future obligations under the contract. The provision is measured at the present value of the lower of the expected cost of
terminating the contract and the expected net cost of continuing with the contract. Before a provision is established the Group
recognizes any impairment loss on the assets associated with that contract.



1.18 Foreign currency



Functional currency



The functional currency of Infosys, Infosys
BPO, EdgeVerve, Skava and controlled trusts is the Indian rupee. The functional currencies for Infosys Australia, Infosys China,
Infosys Mexico, Infosys Sweden, Infosys Brasil, Infosys Public Services, Infosys Shanghai, Infosys Lodestone, Infosys Americas,
Infosys Nova, Panaya, Kallidus and Noah are the respective local currencies. These financial statements are presented in U.S.dollars
(rounded off to the nearest million).



Transactions and translations



Foreign-currency denominated monetary
assets and liabilities are translated into the relevant functional currency at exchange rates in effect at the balance sheet date.
The gains or losses resulting from such translations are included in net profit in the statement of comprehensive income. Non-monetary
assets and non-monetary liabilities denominated in a foreign currency and measured at fair value are translated at the exchange
rate prevalent at the date when the fair value was determined. Non-monetary assets and non-monetary liabilities denominated in
a foreign currency and measured at historical cost are translated at the exchange rate prevalent at the date of transaction.



Transaction gains or losses realized
upon settlement of foreign currency transactions are included in determining net profit for the period in which the transaction
is settled. Revenue, expense and cash-flow items denominated in foreign currencies are translated into the relevant functional
currencies using the exchange rate in effect on the date of the transaction.



The translation of financial statements
of the foreign subsidiaries to the presentation currency of the company is performed for assets and liabilities using the exchange
rate in effect at the balance sheet date and for revenue, expense and cash-flow items using the average exchange rate for the respective
periods. The gains or losses resulting from such translation are included in currency translation reserves under other components
of equity. When a subsidiary is disposed of, in full, the relevant amount is transferred to net profit in the statement of comprehensive
income. However when a change in the parent's ownership does not result in loss of control of a subsidiary, such changes are recorded
through equity.



Goodwill and fair value adjustments arising
on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the exchange
rate in effect at the balance sheet date.



1.19 Income taxes



Income tax expense comprises current
and deferred income tax. Income tax expense is recognized in net profit in the statement of comprehensive income except to the
extent that it relates to items recognized directly in equity, in which case it is recognized in equity. Current income tax for
current and prior periods is recognized at the amount expected to be paid to or recovered from the tax authorities, using the tax
rates and tax laws that have been enacted or substantively enacted by the balance sheet date. Deferred income tax assets and liabilities
are recognized for all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts
in the financial statements except when the deferred income tax arises from the initial recognition of goodwill or an asset or
liability in a transaction that is not a business combination and affects neither accounting nor taxable profit or loss at the
time of the transaction. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer
probable that the related tax benefit will be realized.



Deferred income tax assets and liabilities
are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date and are expected
to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect
of changes in tax rates on deferred income tax assets and liabilities is recognized as income or expense in the period that includes
the enactment or the substantive enactment date. A deferred income tax asset is recognized to the extent that it is probable that
future taxable profit will be available against which the deductible temporary differences and tax losses can be utilized. Deferred
income taxes are not provided on the undistributed earnings of subsidiaries and branches where it is expected that the earnings
of the subsidiary or branch will not be distributed in the foreseeable future. The group offsets current tax assets and current
tax liabilities, where it has a legally enforceable right to set off the recognized amounts and where it intends either to settle
on a net basis, or to realize the asset and settle the liability simultaneously. Tax benefits of deductions earned on exercise
of employee share options in excess of compensation charged to income are credited to share premium.



1.20 Dividends



Final dividends on shares are recorded
as a liability on the date of approval by the shareholders and interim dividends are recorded as a liability on the date of declaration
by the company's Board of Directors.



1.21 Operating profit



Operating profit for the Group is computed
considering the revenues, net of cost of sales, selling and marketing expenses and administrative expenses.



1.22 Other income



Other income is comprised primarily of
interest income, dividend income and exchange gain/loss on forward and options contracts and on translation of other assets and
liabilities. Interest income is recognized using the effective interest method. Dividend income is recognized when the right to
receive payment is established.



1.23 Leases



Leases under which the group assumes
substantially all the risks and rewards of ownership are classified as finance leases. When acquired, such assets are capitalized
at fair value or present value of the minimum lease payments at the inception of the lease, whichever is lower. Lease payments
under operating leases are recognized as an expense on a straight line basis in net profit in the statement of comprehensive income
over the lease term.



1.24 Government grants



The Group recognizes government grants
only when there is reasonable assurance that the conditions attached to them shall be complied with, and the grants will be received.
Government grants related to assets are treated as deferred income and are recognized in net profit in the statement of comprehensive
income on a systematic and rational basis over the useful life of the asset. Government grants related to revenue are recognized
on a systematic basis in net profit in the statement of comprehensive income over the periods necessary to match them with the
related costs which they are intended to compensate.



1.25 Recent accounting pronouncements



1.25.1 Standards issued but not yet effective



IFRS 9 Financial instruments:In
July 2014, the International Accounting Standards Board issued the final version of IFRS 9, Financial Instruments. The standard
reduces the complexity of the current rules on financial instruments as mandated in IAS 39. IFRS 9 has fewer classification and
measurement categories as compared to IAS 39 and has eliminated the categories of held to maturity, available for sale and loans
and receivables. Further it eliminates the rule-based requirement of segregating embedded derivatives and tainting rules pertaining
to held to maturity investments. For an investment in an equity instrument which is not held for trading, IFRS 9 permits an irrevocable
election, on initial recognition, on an individual share-by-share basis, to present all fair value changes from the investment
in other comprehensive income. No amount recognized in other comprehensive income would ever be reclassified to profit or loss.
It requires the entity, which chooses to measure a liability at fair value, to present the portion of the fair value change attributable
to the entity’s own credit risk in the other comprehensive income.



IFRS 9 replaces the ‘incurred loss
model’ in IAS 39 with an ‘expected credit loss’ model. The measurement uses a dual measurement approach, under
which the loss allowance is measured as either 12 month expected credit losses or lifetime expected credit losses. The standard
also introduces new presentation and disclosure requirements.



The effective date for adoption of IFRS
9 is annual periods beginning on or after January 1, 2018, though early adoption is permitted. The Group has elected to early adopt
the standard effective April 1, 2016 and the impact on the consolidated financial statements is not material.



IFRS 15 Revenue from Contract with
Customers: In May 2014, the International Accounting Standards Board (IASB) issued IFRS 15, Revenue from Contract with Customers.
The core principle of the new standard is that an entity should recognize revenue to depict the transfer of promised goods or services
to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods
or services. Further the new standard requires enhanced disclosures about the nature, amount, timing and uncertainty of revenue
and cash flows arising from the entity’s contracts with customers. The standard permits the use of either the retrospective
or cumulative effect transition method. The effective date for adoption of IFRS 15 is annual periods beginning on or after January
1, 2017, though early adoption is permitted. In September 2015, the IASB issued an amendment to IFRS 15, deferring the adoption
of the standard to periods beginning on or after January 1, 2018 instead of January 1, 2017.



The Group is evaluating the effect of IFRS 15
on the consolidated financial statements including the transition method to be adopted and the related disclosures. The group continues
to evaluate the effect of the standard on ongoing financial reporting.



IFRS 16 Leases: On January 13,
2016, the International Accounting Standards Board issued the final version of IFRS 16, Leases. IFRS 16 will replace the existing
leases Standard, IAS 17 Leases, and related Interpretations. The Standard sets out the principles for the recognition, measurement,
presentation and disclosure of leases for both parties to a contract i.e., the lessee and the lessor. IFRS 16 introduces a single
lessee accounting model and requires a lessee to recognize assets and liabilities for all leases with a term of more than 12 months,
unless the underlying asset is of low value. Currently, operating lease expenses are charged to the statement of comprehensive
income. The Standard also contains enhanced disclosure requirements for lessees. IFRS 16 substantially carries forward the lessor
accounting requirements in IAS 17.



The effective date for adoption of IFRS
16 is annual periods beginning on or after January 1, 2019, though early adoption is permitted for companies applying IFRS 15 Revenue
from Contracts with Customers. The Group is yet to evaluate the requirements of IFRS 16 and the impact on the consolidated financial
statements.



2 Notes to the consolidated financial
statements



2.1 Cash and cash equivalents



Cash and cash equivalents consist of
the following:

(Dollars in millions)

|                                    | As of         
|----------------------------------- | --------------
|                                    | March 31, 2016
|Cash and bank deposits              | 4,139         
|Deposits with financial institution | 796           
|                                    | 4,935         



Cash and cash equivalents as of March
31, 2016 and March 31, 2015 include restricted cash and bank balances of $74 million and $58 million, respectively. The restrictions
are primarily on account of cash and bank balances held by irrevocable trusts controlled by the company, bank balances held as
margin money deposits against guarantees and balances held in unpaid dividend bank accounts.



The deposits maintained by the
Group with banks and financial institution comprise of time deposits, which can be withdrawn by the Group at any point without
prior notice or penalty on the principal.

The table below provides details of cash
and cash equivalents:

(Dollars in millions)

|                                                                      | As of         
|--------------------------------------------------------------------- | --------------
|                                                                      | March 31, 2016
|Current accounts                                                      |               
|ANZ Bank, Taiwan                                                      | 2             
|Banamex Bank, Mexico                                                  | 1             
|Bank of America, USA                                                  | 103           
|Bank of America, Mexico                                               | 3             
|Bank of Zachodni WBK S.A., Poland                                     | 1             
|Barclays Bank, UK                                                     | 3             
|Bank Leumi, Israel (US Dollar Account)                                | 3             
|Bank Leumi, Israel (Israeli Sheqel account)                           | 2             
|China Merchants Bank, China                                           | 1             
|Citibank N.A., Australia                                              | 11            
|Citibank N.A., Brazil                                                 | 1             
|Citibank N.A., China                                                  | 10            
|Citibank N.A., China (U.S. Dollar account)                            | 11            
|Citibank N.A., Costa Rica                                             | –             
|Citibank N.A., Japan                                                  | 2             
|Citibank N.A., Czech Republic                                         | –             
|Citibank N.A., India                                                  | –             
|Citibank N.A., New Zealand                                            | 1             
|Citibank N.A., South Africa                                           | 1             
|Citibank N.A., USA                                                    | 9             
|Commerzbank, Germany                                                  | 3             
|Crédit Industrial et Commercial Bank, France                          | 1             
|Deutsche Bank, Belgium                                                | 9             
|Deutsche Bank, Malaysia                                               | 1             
|Deutsche Bank, Czech Republic                                         | 2             
|Deutsche Bank, Czech Republic (U.S. dollar account)                   | 4             
|Deutsche Bank, France                                                 | 2             
|Deutsche Bank, Germany                                                | 3             
|Deutsche Bank, India                                                  | 1             
|Deutsche Bank, Netherlands                                            | 1             
|Deutsche Bank, Philippines                                            | 2             
|Deutsche Bank, Philippines (U.S. dollar account)                      | –             
|Deutsche Bank, Poland                                                 | 1             
|Deutsche Bank, Singapore                                              | 1             
|Deutsche Bank, United Kingdom                                         | 26            
|Deutsche Bank-EEFC (Swiss Franc account)                              | 1             
|Deutsche Bank-EEFC (Euro account)                                     | 5             
|Deutsche Bank-EEFC (U.S. dollar account)                              | 15            
|Deutsche Bank-EEFC, India (United
    Kingdom Pound Sterling account) | 1             
|HSBC Bank, Brazil                                                     | 1             
|HSBC Bank, Hong Kong                                                  | –             
|ICICI Bank, India                                                     | 11            
|ICICI Bank-EEFC, India (U.S. dollar account)                          | 2             
|Nordbanken, Sweden                                                    | 2             
|Raiffeisen Bank, Czech Republic                                       | 1             
|Raiffeisen Bank, Romania                                              | 1             
|Royal Bank of Canada, Canada                                          | 12            
|Royal Bank of Scotland, China                                         | –             
|Royal Bank of Scotland, China (U.S. Dollar account)                   | –             
|State Bank of India, India                                            | 1             
|Punjab National Bank, India                                           | 1             
|Silicon Valley Bank, USA                                              | 1             
|Silicon Valley Bank (Euro account)                                    | 10            
|Silicon Valley Bank (United .Kingdom Pound Sterling account)          | 3             
|Union Bank of Switzerland, AG                                         | 2             
|Union Bank of Switzerland, AG (U.S. dollar account)                   | 4             
|Union Bank of Switzerland, AG (Euro account)                          | 2             
|Union Bank of Switzerland AG, (United Kingdom Pound Sterling account) | 1             
|Wells Fargo Bank N.A., USA                                            | 3             
|Westpac, Australia                                                    | 1             
|                                                                      | 303           
|Deposit accounts                                                      |               
|Andhra Bank, India                                                    | 143           
|Allahabad Bank, India                                                 | –             
|Axis Bank, India                                                      | 202           
|Bank of Baroda, India                                                 | –             
|Bank of India, India                                                  | 11            
|Canara Bank, India                                                    | 339           
|Central Bank of India, India                                          | 232           
|Citibank, India                                                       | 19            
|Corporation Bank, India                                               | 194           
|Deutsche Bank, Poland                                                 | 36            
|Development Bank of Singapore, Singapore                              | –             
|HDFC Bank, India                                                      | 400           
|ICICI Bank, India                                                     | 634           
|IDBI Bank, India                                                      | 287           
|Indusind Bank, India                                                  | 38            
|ING Vysya Bank, India                                                 | –             
|Indian Overseas Bank, India                                           | 189           
|Jammu and Kashmir Bank, India                                         | 4             
|Kotak Mahindra Bank, India                                            | 81            
|National Australia Bank Limited, Australia                            | –             
|Oriental Bank of Commerce, India                                      | 297           
|Punjab National Bank, India                                           | 3             
|State Bank of India, India                                            | 357           
|South Indian Bank, India                                              | 3             
|Syndicate Bank, India                                                 | 191           
|Union Bank of India, India                                            | 21            
|Vijaya Bank, India                                                    | 46            
|Yes Bank, India                                                       | 109           
|                                                                      | 3,836         
|Deposits with financial institution                                   |               
|HDFC Limited, India                                                   | 796           
|                                                                      | 796           
|Total                                                                 | 4,935         



2.2 Available-for-sale financial assets



Investments in mutual fund units, quoted
debt securities and unquoted equity and preference securities are classified as available-for-sale financial assets.



Cost and fair value of these investments
are as follows:

(Dollars in millions)

|                                               | As of         
|---------------------------------------------- | --------------
|                                               | March 31, 2016
|Current                                        |               
|Mutual fund units:                             |               
|Liquid mutual funds                            |               
|Cost and fair value                            | 10            
|Quoted debt securities:                        |               
|Cost                                           | 1             
|Gross unrealized holding gains/(losses)        | –             
|Fair value                                     | 1             
|Fixed Maturity Plan Securities                 |               
|Cost                                           | –             
|Gross unrealized holding gains                 | –             
|Fair value                                     | –             
|                                               | 11            
|Non-Current                                    |               
|Quoted debt securities:                        |               
|Cost                                           | 250           
|Gross unrealized holding gains / (losses)      | 6             
|Fair value                                     | 256           
|Unquoted equity and
    preference securities: |               
|Cost                                           | 14            
|Gross unrealized holding gains                 | –             
|Fair value                                     | 14            
|Others:                                        |               
|Cost                                           | 3             
|Gross unrealized holding gains                 | –             
|Fair value                                     | 3             
|                                               | 273           
|Total available-for-sale financial assets      | 284           



Mutual fund units:



Liquid mutual funds:



The fair value of liquid mutual funds
as of March 31, 2016 and March 31, 2015 was $10 million and $135 million, respectively. The fair value is based on quoted prices.



Fixed maturity plan securities:



During the year ended March 31, 2016, the company redeemed
fixed maturity plans securities of $5 million. On redemption, the unrealized gain of less than $1 million pertaining to these securities
has been reclassified from other comprehensive income to profit or loss.



The fair value of fixed maturity plan
securities as of March 31, 2015 is $5 million. The fair value was based on quotes reflected in actual transactions in similar instruments
as available on March 31, 2015. The net unrealized gain of less than $1 million, net of taxes has been recognized in other comprehensive
income for  the year ended March 31, 2015.



During the year ended March 31, 2015,
the company redeemed fixed maturity plans securities of $19 million. On redemption, the unrealised gain of $1 million, net of taxes
of $1 million, pertaining to these securities has been reclassified from other comprehensive income to profit or loss during the
year ended March 31, 2015. The net unrealized gain of $1 million, net of taxes of less than $1 million has been recognized in other
comprehensive income for the year ended March 31, 2014 (Refer to note 2.16).



Quoted debt securities:



The fair value of the quoted debt securities
as of March 31, 2016 and March 31, 2015 is $257 million and $215 million, respectively. The net unrealized gain of $6 million net
of taxes of $1 million, has been recognized in other comprehensive income for the year ended March 31, 2016. The net unrealized
gain of $15 million net of taxes of $2 million, has been recognized in other comprehensive income for the year ended March 31,
2015. The net unrealized loss of $18 million, net of taxes of $2 million, has been recognized in other comprehensive income for
the year ended March 31, 2014. The fair value is based on the quoted prices and market observable inputs (Refer to note 2.16).



2.3 Business combinations



McCamish



During fiscal 2010, Infosys BPO acquired
100% of the voting interests in McCamish Systems LLC (McCamish), a business process solutions provider based in Atlanta, Georgia,
in the United States. The business acquisition was conducted by entering into a Membership Interest Purchase Agreement for cash
consideration of $37 million and contingent consideration of up to $20 million. The fair values of the contingent consideration
and its undiscounted value on the date of acquisition were $9 million and $15 million, respectively.



The payment of contingent consideration
was dependent upon the achievement of certain revenue targets and net margin targets by McCamish over a period of 4 years ending
March 31, 2014. Further, contingent to McCamish signing any deal with total revenues of $100 million or more, the aforesaid period
could be extended by 2 years.



The fair value of the contingent consideration
was determined by discounting the estimated amount payable to the previous owners of McCamish on achievement of certain financial
targets. The key inputs used for the determination of fair value of contingent consideration were the discount rate of 13.9% and
the probabilities of achievement of the net margin and the revenue targets ranging from 50% to 100%.



During the year ended March 31, 2013,
pursuant to McCamish entering into the asset purchase agreement with Seabury & Smith Inc., the company conducted an assessment
of the probability of McCamish achieving the required revenue and net margin targets pertaining to contingent consideration. The
assessment was based on the actual and projected revenues and net margins pertaining to McCamish post consummation of the asset
purchase transaction. Consequently, the fair value of the contingent consideration and its related undiscounted value was determined
at $3 million and $4 million, respectively and the related liability no longer required was reversed in the statement of comprehensive
income. The contingent consideration was estimated to be in the range between $4 million and $6 million.



During the year ended March 31, 2014,
the liability related to the contingent consideration increased by less than $1 million due to passage of time.



During March 2014, an assessment of the
probability of McCamish achieving the required revenue and net margin targets pertaining to the contingent consideration was conducted
and the entire contingent consideration was reversed in the statement of comprehensive income as it was estimated that the liability
is no longer required.



Infosys Consulting Holding AG (formerly
Lodestone Holding AG)



On
October 22, 2012, Infosys acquired 100% of the voting interests in Lodestone Holding AG, a global management consultancy firm
headquartered in Zurich. The business acquisition was conducted by entering into a share purchase agreement for a cash
consideration of $219 million and an additional consideration of up to $112 million, which the company refers to as deferred
purchase price, estimated on the date of acquisition, payable to the selling shareholders of Lodestone Holding AG who are
continuously employed or otherwise engaged by the Group during the three year period following the date of the
acquisition. This transaction is treated as post acquisition
employee remuneration expense as per IFRS 3R. During the year ended March 31, 2016, the liability towards post-acquisition
employee remuneration expense was settled.



For fiscal 2016, 2015 and 2014, a post-acquisition
employee remuneration expense of $23 million, $41 million and $31 million, respectively, is recorded in cost of sales in the statement
of comprehensive income.



Panaya



On March 5, 2015, Infosys acquired
100% of the voting interests in Panaya Inc. a Delaware Corporation in the United States. Panaya is a leading provider of
automation technology for large scale enterprise and software management. The business acquisition was conducted by entering
into a share purchase agreement for cash consideration of $225 million.



Panaya’s CloudQualityTM suite
positions Infosys to bring automation to several of its service lines via an agile SaaS model, and helps mitigate risk, reduce
costs and shorten time to market for clients.  The excess of the purchase consideration paid over the fair value of net assets
acquired has been attributed to goodwill.



The purchase price has been allocated
based on Management’s estimates and independent appraisal of fair values as follows:

(Dollars in millions)

|Component                                                | Acquiree's carrying amount | Fair value adjustments | Purchase priceallocated
|-------------------------------------------------------- | -------------------------- | ---------------------- | -----------------------
|Property, plant and equipment                            | 2                          | –                      | 2                      
|Net current assets*                                      | 6                          | –                      | 6                      
|Intangible assets – technology                           | –                          | 39                     | 39                     
|Intangible assets – trade name                           | –                          | 3                      | 3                      
|Intangible assets – customer contracts and relationships | –                          | 13                     | 13                     
|Intangible assets – non compete agreements               | –                          | 4                      | 4                      
|Deferred tax liabilities on intangible assets            | –                          | (16)                   | (16)                   
|                                                         | 8                          | 43                     | 51                     
|Goodwill                                                 |                            |                        | 174                    
|Total purchase price                                     |                            |                        | 225                    



* Includes cash and cash equivalents
acquired of $19 million.



The goodwill is not tax deductible.



The gross amount of trade receivables
acquired and its fair value is $9 million and the amounts have been largely collected.



The fair value of total cash consideration
as at the acquisition date was $225 million.



The transaction costs of $4 million related
to the acquisition have been included under administrative expenses in the statement of comprehensive income for the year ended
March 31, 2015.



Kallidus Inc. (d.b.a Skava)



On June 2, 2015, Infosys acquired 100%
of the voting interests in Kallidus Inc., US, a leading provider of digital experience solutions, including mobile commerce
and in-store shopping experiences to large retail clients and 100% of the voting interests of Skava Systems Private Limited, an
affiliate of Kallidus. The business acquisition was conducted by entering into a share purchase agreement for cash consideration
of $91 million and a contingent consideration of up to $20 million.



Infosys expects to help its clients bring
new digital experiences to their customers through IP-led technology offerings, new automation tools and skill and expertise in
these new emerging areas. The excess of the purchase consideration paid over the fair value of net assets acquired has been attributed
to goodwill.



The purchase price has been allocated
based on management’s estimates and independent appraisal of fair values as follows:

(Dollars in millions)

|Component                                                | Acquiree's carrying amount | Fair value adjustments | Purchase priceallocated
|-------------------------------------------------------- | -------------------------- | ---------------------- | -----------------------
|Net Assets*                                              | 6                          | –                      | 6                      
|Intangible assets – technology                           | –                          | 21                     | 21                     
|Intangible assets – trade name                           | –                          | 2                      | 2                      
|Intangible assets – customer contracts and relationships | –                          | 27                     | 27                     
|Deferred tax liabilities on intangible assets            | –                          | (20)                   | (20)                   
|                                                         | 6                          | 30                     | 36                     
|Goodwill                                                 |                            |                        | 71                     
|Total purchase price                                     |                            |                        | 107                    



* Includes cash and cash equivalents
acquired of $4 million.



The goodwill is not tax deductible.



The gross amount of trade receivables
acquired and its fair value is $9 million and the amounts have been fully collected.



The acquisition date fair value of each
major class of consideration as of the acquisition date is as follows:

(Dollars in millions)

|Component                              |  |  | Consideration settled
|-------------------------------------- |  |  | ---------------------
|Cash Paid                              |  |  | 91                   
|Fair value of contingent consideration |  |  | 16                   
|Total purchase price                   |  |  | 107                  



The payment of contingent consideration
to sellers of Kallidus is dependent upon the achievement of certain financial targets by Kallidus over a period of 3 years ending
on December 31, 2017.



The fair value of contingent consideration
is determined by discounting the estimated amount payable to the sellers of Kallidus on achievement of certain financial targets.
At the acquisition date, the key inputs used in determination of the fair value of contingent consideration are the discount rate
of 14% and the probabilities of achievement of the financial targets.



The transaction costs of $2 million related
to the acquisition have been included under administrative expenses in the statement of comprehensive income for the year ended
March 31, 2016



Noah Consulting LLC



On November 16, 2015, Infosys has acquired 100% membership interest in Noah Consulting, LLC, a leading provider
of advanced information management consulting services for the oil and gas industry. The business acquisition was conducted by
entering into a share purchase agreement for cash consideration of $33 million, a contingent consideration of up to $5 million
and an additional consideration of up to $32 million, referred to as retention bonus payable to the employees of Noah at each anniversary
year following the acquisition date for the next three years, subject to their continuous employment with the group at each anniversary.



This acquisition combines Noah’s
industry knowledge, information strategy planning, data governance and architecture capabilities with Infosys’ ability to
provide technology and outsourcing services on a global scale to oil and gas clients. The excess of the purchase consideration
paid over the fair value of net assets acquired has been attributed to goodwill.



The purchase price has been allocated
based on management’s estimates and independent appraisal of fair values as follows:

(Dollars in millions)

|Component                                                | Acquiree's carrying amount | Fair value adjustments | Purchase priceallocated
|-------------------------------------------------------- | -------------------------- | ---------------------- | -----------------------
|Net Assets*                                              | 6                          | –                      | 6                      
|Intangible assets – technical know-how                   | –                          | 4                      | 4                      
|Intangible assets – trade name                           | –                          | 4                      | 4                      
|Intangible assets – customer contracts and relationships | –                          | 18                     | 18                     
|                                                         | 6                          | 26                     | 32                     
|Goodwill                                                 |                            |                        | 5                      
|Total purchase price                                     |                            |                        | 37                     



* Includes cash and cash equivalents
acquired of $3 million.



Goodwill of $1 million is tax deductible.



The gross amount of trade receivables
acquired and its fair value is $4 million and the amounts have been largely collected.



The acquisition date fair value of each
major class of consideration as of the acquisition date is as follows:

(Dollars in millions)

|Component                              |  |  | Consideration settled
|-------------------------------------- |  |  | ---------------------
|Cash Paid                              |  |  | 33                   
|Fair value of contingent consideration |  |  | 4                    
|Total purchase price                   |  |  | 37                   



The fair value of contingent consideration
is determined by discounting the estimated amount payable to the sellers of Noah on achievement of certain financial targets. At
the acquisition date, the key inputs used in determination of the fair value of contingent consideration are the discount rate
of 32% and the probabilities of achievement of the financial targets. During fiscal 2016, based on an assessment
of Noah achieving the targets for the year ended December 31, 2015 and year ending December 31, 2016, the entire contingent consideration
has been reversed in the statement of comprehensive income.



The retention bonus is treated as a post-acquisition
employee remuneration expense as per IFRS 3R. For the period from the closing of the acquisition to March 31, 2016, a post-acquisition
employee remuneration expense of $8 million has been recorded in the statement of comprehensive income.



The transaction costs of $2 million related
to the acquisition have been included under administrative expenses in the statement of comprehensive income for the year ended
March 31, 2016.



EdgeVerve Systems Limited



EdgeVerve was created as a wholly
owned subsidiary to focus on developing and selling products and platforms. On April 15, 2014, the Board of Directors of
Infosys authorized the Company to execute a Business Transfer Agreement and related documents with EdgeVerve, subject to
securing the requisite approval from shareholders in the Annual General Meeting. Subsequently, at the AGM held on June 14,
2014, the shareholders authorised the Board to enter into a Business Transfer Agreement and related documents with EdgeVerve,
with effect from July 1, 2014 or such other date as may be decided by the Board of Directors. The company had undertaken an
enterprise valuation by an independent valuer and accordingly the business was transferred for a consideration of $70 million
(421 crore) with effect from July 1, 2014 which was settled through the issue of fully paid up equity shares.



The transfer of assets and liabilities
is accounted for at carrying values and does not have any impact on the consolidated financial statements.



Finacle and Edge Services



On
April 24, 2015, the Board of Directors of Infosys authorized the Company to execute a Business Transfer Agreement and related documents
with EdgeVerve, a wholly owned subsidiary, to transfer the business of Finacle and Edge Services. Post the requisite approval from
shareholders through postal ballot on June 4, 2015, a Business Transfer Agreement and other related documents were executed with
EdgeVerve to transfer the business with effect from August 1, 2015. The company has undertaken an enterprise valuation by an independent
valuer and accordingly the business were transferred for a consideration of 3,222
crore (approximately $491 million) and 177
crore (approximately $27 million) for Finacle and Edge Services, respectively.



The
consideration was settled through issue of 850,000,000 equity shares amounting to 850
crore (approximately $129 million) and 254,900,000 non-convertible redeemable debentures amounting to 2,549
crore (approximately $389 million) in EdgeVerve, post the requisite approval from shareholders on December 11, 2015.



The transfer of assets and liabilities
was accounted for at carrying values and did not have any impact on the consolidated financial statements.



2.4 Prepayments and other assets



Prepayments and other assets consist
of the following:

(Dollars in millions)

|                                                    | As of         
|--------------------------------------------------- | --------------
|                                                    | March 31, 2016
|Current                                             |               
|Rental deposits                                     | 2             
|Security deposits                                   | 1             
|Loans and advances to employees                     | 46            
|Prepaid expenses (1)                                | 30            
|Interest accrued and not due                        | 106           
|Withholding taxes (1)                               | 272           
|Deferred contract cost (1)                          | 7             
|Deposit with corporation                            | 187           
|Advance payments to vendors for supply of goods (1) | 17            
|Other assets                                        | 4             
|                                                    | 672           
|Non-current                                         |               
|Loans and advances to employees                     | 4             
|Security deposits                                   | 12            
|Deposit with corporation                            | 9             
|Prepaid gratuity (1)                                | 1             
|Prepaid expenses (1)                                | 13            
|Deferred contract cost (1)                          | 50            
|Rental deposits                                     | 22            
|                                                    | 111           
|                                                    | 783           
|Financial assets in prepayments and other assets    | 393           



|(1) | Non-financial
    assets
|--- | ------------------------
|    |                         

Withholding taxes primarily consist
of input tax credits. Other assets primarily represent travel advances and other recoverables. Security deposits relate
principally to leased telephone lines and electricity supplies. Deferred contract costs are upfront costs incurred for the
contract and are amortized over the term of the contract.



Deposit with corporation represents amounts
deposited to settle certain employee-related obligations as and when they arise during the normal course of business.



2.5 Property, plant and equipment





Following are the changes in the carrying
value of property, plant and equipment for the year ended March 31, 2016:

(Dollars in millions)

|                                              | Land | Buildings | Plant andmachinery | Computer equipment | Furniture andfixtures | Vehicles | Total  
|--------------------------------------------- | ---- | --------- | ------------------ | ------------------ | --------------------- | -------- | -------
|Gross carrying value as of April 1, 2015      | 250  | 940       | 337                | 535                | 189                   | 6        | 2,257  
|Additions                                     | 9    | 68        | 76                 | 168                | 40                    | 1        | 362    
|Deletions                                     | –    | –         | (1)                | (60)               | (1)                   | (2)      | (64)   
|Translation difference                        | (15) | (53)      | (20)               | (28)               | (10)                  | (1)      | (127)  
|Gross carrying value as of March 31, 2016     | 244  | 955       | 392                | 615                | 218                   | 4        | 2,428  
|Accumulated depreciation as of April 1, 2015  | (3)  | (317)     | (207)              | (365)              | (132)                 | (3)      | (1,027)
|Depreciation                                  | (1)  | (33)      | (49)               | (84)               | (24)                  | (1)      | (192)  
|Accumulated depreciation on deletions         | –    | –         | 1                  | 36                 | 1                     | 1        | 39     
|Translation difference                        | 1    | 18        | 12                 | 18                 | 6                     | –        | 55     
|Accumulated depreciation as of March 31, 2016 | (3)  | (332)     | (243)              | (395)              | (149)                 | (3)      | (1,125)
|Capital work-in-progress as of March 31, 2016 |      |           |                    |                    |                       |          | 286    
|Carrying value as of March 31, 2016           | 241  | 623       | 149                | 220                | 69                    | 1        | 1,589  
|Capital work-in-progress as of April 1, 2015  |      |           |                    |                    |                       |          | 230    
|Carrying value as of April 1, 2015            | 247  | 623       | 130                | 170                | 57                    | 3        | 1,460  



Following are the changes in the carrying
value of property, plant and equipment for the year ended March 31, 2015:

(Dollars in millions)

|                                                                      | Land | Buildings | Plant andmachinery | Computerequipment | Furniture andfixtures | Vehicles | Total  
|--------------------------------------------------------------------- | ---- | --------- | ------------------ | ----------------- | --------------------- | -------- | -------
|Gross carrying value as of April 1, 2014                              | 190  | 839       | 284                | 444               | 170                   | 6        | 1,933  
|Additions                                                             | 69   | 139       | 69                 | 124               | 30                    | 1        | 432    
|Acquisitions through business combination
        (Refer to note 2.3) | –    | –         | –                  | 2                 | 1                     | –        | 3      
|Deletions                                                             | –    | –         | (3)                | (13)              | (3)                   | (1)      | (20)   
|Translation difference                                                | (9)  | (38)      | (13)               | (22)              | (9)                   | –        | (91)   
|Gross carrying value as of March 31, 2015                             | 250  | 940       | 337                | 535               | 189                   | 6        | 2,257  
|Accumulated depreciation as of April 1, 2014                          | –    | (300)     | (175)              | (328)             | (117)                 | (2)      | (922)  
|Accumulated depreciation on acquired assets (Refer to note 2.3)       | –    | –         | –                  | (1)               | –                     | –        | (1)    
|Depreciation                                                          | (3)  | (31)      | (42)               | (63)              | (24)                  | (1)      | (164)  
|Accumulated depreciation on deletions                                 | –    | –         | 2                  | 11                | 3                     | 1        | 17     
|Translation difference                                                | –    | 14        | 8                  | 16                | 6                     | (1)      | 43     
|Accumulated depreciation as of March 31, 2015                         | (3)  | (317)     | (207)              | (365)             | (132)                 | (3)      | (1,027)
|Capital work-in-progress as of March 31, 2015                         |      |           |                    |                   |                       |          | 230    
|Carrying value as of March 31, 2015                                   | 247  | 623       | 130                | 170               | 57                    | 3        | 1,460  
|Capital work-in-progress as of April 1, 2014                          |      |           |                    |                   |                       |          | 305    
|Carrying value as of April 1, 2014                                    | 190  | 539       | 109                | 116               | 53                    | 4        | 1,316  



Following are the changes in the carrying
value of property, plant and equipment for the year ended March 31, 2014:



(Dollars in millions)

|                                              | Land | Buildings | Plant andmachinery | Computerequipment | Furniture andfixtures | Vehicles | Total
|--------------------------------------------- | ---- | --------- | ------------------ | ----------------- | --------------------- | -------- | -----
|Gross carrying value as of April 1, 2013      | 157  | 773       | 231                | 347               | 147                   | 5        | 1,660
|Additions                                     | 48   | 136       | 73                 | 125               | 33                    | 2        | 417  
|Deletions                                     | –    | –         | (1)                | (5)               | –                     | (1)      | (7)  
|Translation difference                        | (15) | (70)      | (19)               | (23)              | (10)                  | –        | (137)
|Gross carrying value as of March 31, 2014     | 190  | 839       | 284                | 444               | 170                   | 6        | 1,933
|Accumulated depreciation as of April 1, 2013  | –    | (275)     | (154)              | (240)             | (103)                 | (3)      | (775)
|Depreciation                                  | –    | (49)      | (35)               | (109)             | (21)                  | –        | (214)
|Accumulated depreciation on deletions         | –    | –         | –                  | 4                 | –                     | 1        | 5    
|Translation difference                        | –    | 24        | 14                 | 17                | 7                     | –        | 62   
|Accumulated depreciation as of March 31, 2014 | –    | (300)     | (175)              | (328)             | (117)                 | (2)      | (922)
|Capital work-in-progress as of March 31, 2014 |      |           |                    |                   |                       |          |      
|Carrying value as of March 31, 2014           | 190  | 539       | 109                | 116               | 53                    | 4        | 1,316
|Capital work-in-progress as of April 1, 2013  |      |           |                    |                   |                       |          | 306  
|Carrying value as of April 1, 2013            | 157  | 498       | 77                 | 107               | 44                    | 2        | 1,191





During the three months ended June 30,
2014, the management based on internal and external technical evaluation had changed the useful life of certain assets primarily
consisting of buildings and computers with effect from April 1, 2014. Accordingly, the useful lives of certain assets required
a change from previous estimate.



The depreciation expense is included
in cost of sales in the statement of comprehensive income.

Carrying value of land includes
$95 million and $99 million as of March 31, 2016 and March 31, 2015, respectively, towards deposits paid under certain lease-cum-sale
agreements to acquire land, including agreements where the company has an option to either purchase the properties or renew the
lease on expiry of the lease period.

The contractual commitments for
capital expenditure were $224 million and $252 million as of March 31, 2016 and March 31, 2015, respectively.

2.6 Goodwill and intangible assets



Following is a summary of changes in
the carrying amount of goodwill:

(Dollars in millions)

|                                                                 | As of         
|---------------------------------------------------------------- | --------------
|                                                                 | March 31, 2016
|Carrying value at the beginning                                  | 495           
|Goodwill on Panaya acquisition (Refer to note 2.3)               | –             
|Goodwill on Kallidus d.b.a Skava acquisition (Refer to note 2.3) | 71            
|Goodwill on Noah acquisition (Refer to note 2.3)                 | 5             
|Translation differences                                          | (3)           
|Carrying value at the end                                        | 568           



For the purpose of impairment testing,
goodwill acquired in a business combination is allocated to the cash generating units (CGU) or groups of CGUs, which are benefited
from the synergies of the acquisition. The Chief Operating Decision Maker reviews the goodwill for any impairment at the operating
segment level, which is represented through groups of CGUs.



During the year ended March 31, 2016,
the Company reorganized some of its segments to enhance executive customer relationships, improve focus of sales investments and
increase management oversight. Consequent to these internal reorganizations there were changes effected in the segments based on
the “management approach” as defined in IFRS 8, Operating Segments (Refer Note 2.19). Accordingly the goodwill has
been allocated to the new operating segments as at March 31, 2016.



The following table presents the allocation
of goodwill to operating segments:

(Dollars in millions)

|Segments                                        | As
of         
|----------------------------------------------- | --------------
|                                                | March 31, 2016
|Financial services                              | 128           
|Manufacturing                                   | 64            
|Retail, Consumer packaged goods and Logistics   | 87            
|Life Sciences, Healthcare and Insurance         | 99            
|Energy & utilities, Communication and Services  | 119           
|                                                | 497           
|Operating segments without significant goodwill | 71            
|Total                                           | 568           



The entire goodwill relating to Infosys
BPO’s acquisition of McCamish has been allocated to the groups of CGU’s, which are represented by the Life Sciences,
Healthcare and Insurance segment.



The goodwill relating to Infosys BPO,
Infosys Lodestone, Portland, Panaya and Kallidus d.b.a Skava acquisitions has been allocated to the groups of CGUs, which are represented
by the entity‘s operating segment.



The entire goodwill from Noah acquisition
has been allocated to the group of CGU’s which is represented by the Energy & Utilities, Communication & Services
segment.



The following table gives the breakup
of goodwill to operating segments as at March 31, 2015:

(Dollars in millions)

|Segments                                   | As of         
|------------------------------------------ | --------------
|                                           | March 31, 2015
|Financial services                         | 106           
|Manufacturing                              | 105           
|Energy, communication and services         | 51            
|Resources and utilities                    | 23            
|Life sciences and healthcare               | 31            
|Insurance                                  | 58            
|Retail, consumer packaged goods, logistics | 76            
|Growth markets                             | 45            
|Total                                      | 495           



The recoverable amount of a CGU is the
higher of its fair value less cost to sell and its value-in-use. The fair value of a CGU is determined based on the market capitalization.
The value-in-use is determined based on specific calculations. These calculations use pre-tax cash flow projections over a period
of five years, based on financial budgets approved by management and an average of the range of each assumption mentioned below.
As of March 31, 2016, the estimated recoverable amount of the CGU exceeded its carrying amount. The recoverable amount was computed
based on the fair value being higher than value-in-use and the carrying amount of the CGU was computed by allocating the net assets
to operating segments for the purpose of impairment testing. The key assumptions used for the calculations are as follows:



|As at March 31,       |  | 2016  | 2015 
|--------------------- |  | ----- | -----
|Long term growth rate |  | 8-10  | 8-10 
|Operating margins     |  | 17-20 | 17-20
|Discount rate         |  | 14.2  | 13.9 



The above discount rate is based on the
Weighted Average Cost of Capital (WACC) of the Company. These estimates are likely to differ from future actual results of operations
and cash flows.



Following are the changes in the carrying
value of acquired intangible assets for the year ended March 31, 2016:



(Dollars in millions)

|                                                            | Customer related | Software related | Sub-contracting right related | Intellectual property rights related | Land use rights related | Marketing related | Others | Total
|----------------------------------------------------------- | ---------------- | ---------------- | ----------------------------- | ------------------------------------ | ----------------------- | ----------------- | ------ | -----
|Gross carrying value as of April 1, 2015                    | 72               | 42               | 3                             | 2                                    | 11                      | 8                 | 5      | 143  
|Additions through business combinations (Refer to note 2.3) | 45               | 21               | –                             | –                                    | –                       | 6                 | 4      | 76   
|Deletion                                                    | –                | –                | –                             | (2)                                  | –                       | –                 | –      | (2)  
|Translation differences                                     | –                | (1)              | –                             | –                                    | –                       | –                 | 1      | –    
|Gross carrying value as of March 31, 2016                   | 117              | 62               | 3                             | –                                    | 11                      | 14                | 10     | 217  
|Accumulated amortization as of April 1, 2015                | (26)             | (3)              | (3)                           | (2)                                  | (1)                     | (5)               | (1)    | (41) 
|Amortization expense                                        | (20)             | (6)              | –                             | –                                    | –                       | (1)               | (3)    | (30) 
|Deletion                                                    | –                | –                | –                             | 2                                    | –                       | –                 | –      | 2    
|Translation differences                                     | –                | –                | –                             | –                                    | –                       | 1                 | –      | 1    
|Accumulated amortization as of March 31, 2016               | (46)             | (9)              | (3)                           | –                                    | (1)                     | (5)               | (4)    | (68) 
|Carrying value as of March 31, 2016                         | 71               | 53               | –                             | –                                    | 10                      | 9                 | 6      | 149  
|Carrying value as of April 1, 2015                          | 46               | 39               | –                             | –                                    | 10                      | 3                 | 4      | 102  
|Estimated Useful Life (in years)                            | 3–10             | 8–10             | –                             | –                                    | 50                      | 3–10              | 3–5    |      
|Estimated Remaining Useful Life (in years)                  | 1–7              | 7–9              | –                             | –                                    | 45                      | 2–9               | 2–5    |      



Following are the changes in the carrying
value of acquired intangible assets for the year ended March 31, 2015:



(Dollars in millions)

|                                                            | Customer related | Software related | Sub–contracting right related | Intellectual property rights related | Land use rights related | Marketing related | Others | Total
|----------------------------------------------------------- | ---------------- | ---------------- | ----------------------------- | ------------------------------------ | ----------------------- | ----------------- | ------ | -----
|Gross carrying value as of April 1, 2014                    | 64               | 6                | 3                             | 2                                    | 11                      | 5                 | 1      | 92   
|Additions through business combinations (Refer to note 2.3) | 13               | 39               | –                             | –                                    | –                       | 3                 | 4      | 59   
|Deletion                                                    | –                | (3)              | –                             | –                                    | –                       | –                 | –      | (3)  
|Translation differences                                     | (5)              | –                | –                             | –                                    | –                       | –                 | –      | (5)  
|Gross carrying value as of March 31, 2015                   | 72               | 42               | 3                             | 2                                    | 11                      | 8                 | 5      | 143  
|Accumulated amortization as of April 1, 2014                | (21)             | (4)              | (3)                           | (2)                                  | –                       | (4)               | (1)    | (35) 
|Amortization expense                                        | (7)              | (2)              | –                             | –                                    | (1)                     | (1)               | –      | (11) 
|Deletion                                                    | –                | 3                | –                             | –                                    | –                       | –                 | –      | 3    
|Translation differences                                     | 2                | –                | –                             | –                                    | –                       | –                 | –      | 2    
|Accumulated amortization as of March 31, 2015               | (26)             | (3)              | (3)                           | (2)                                  | (1)                     | (5)               | (1)    | (41) 
|Carrying value as of March 31, 2015                         | 46               | 39               | –                             | –                                    | 10                      | 3                 | 4      | 102  
|Carrying value as of April 1, 2014                          | 43               | 2                | –                             | –                                    | 11                      | 1                 | –      | 57   
|Estimated Useful Life (in years)                            | 3-10             | 10               | 3                             | –                                    | 50                      | 2-10              | 3      |      
|Estimated Remaining Useful Life (in years)                  | 2-8              | 10               | –                             | –                                    | 46                      | 10                | 3      |      



Following are the changes in the carrying
value of acquired intangible assets for the year ended March 31, 2014:



(Dollars in millions)

|                                              | Customer related | Software related | Sub-contracting right related | Intellectual property rights related | Land use rights related | Marketing related | Others | Total
|--------------------------------------------- | ---------------- | ---------------- | ----------------------------- | ------------------------------------ | ----------------------- | ----------------- | ------ | -----
|Gross carrying value as of April 1, 2013      | 62               | 6                | 4                             | 2                                    | 11                      | 5                 | 2      | 92   
|Additions                                     | –                | –                | –                             | –                                    | –                       | –                 | –      | –    
|Translation differences                       | 2                | –                | (1)                           | –                                    | –                       | –                 | (1)    | –    
|Gross carrying value as of March 31, 2014     | 64               | 6                | 3                             | 2                                    | 11                      | 5                 | 1      | 92   
|Accumulated amortization as of April 1, 2013  | (14)             | (5)              | (2)                           | (2)                                  | –                       | (1)               | –      | (24) 
|Amortization expense                          | (7)              | (1)              | (1)                           | –                                    | –                       | (2)               | (1)    | (12) 
|Translation differences                       | –                | 2                | –                             | –                                    | –                       | (1)               | –      | 1    
|Accumulated amortization as of March 31, 2014 | (21)             | (4)              | (3)                           | (2)                                  | –                       | (4)               | (1)    | (35) 
|Carrying value as of March 31, 2014           | 43               | 2                | –                             | –                                    | 11                      | 1                 | –      | 57   
|Carrying value as of April 1, 2013            | 48               | 1                | 2                             | –                                    | 11                      | 4                 | 2      | 68   
|Estimated Useful Life (in years)              | 2-10             | 5                | 3                             | –                                    | 50                      | 2                 | –      |      
|Estimated Remaining Useful Life (in years)    | 1-9              | 3                | 1                             | –                                    | 47                      | 1                 | –      |      



The aggregate amortization expense is
included in cost of sales in the consolidated statement of comprehensive income.



Research and development expense recognized
in net profit in the consolidated statement of comprehensive income, for the years ended March 31, 2016, 2015 and 2014 were $108
million, $110 million and $147 million, respectively.



2.7 Financial instruments



The carrying value and fair value of
financial instruments by categories as of March 31, 2016 were as follows:



(Dollars in millions)

|                                                                         | Loans and receivables | Financial assets / liabilities at fair value throughprofit and loss | Derivative-Hedging Instruments | Available for sale | Trade and other payables | Total carrying value / fair value
|------------------------------------------------------------------------ | --------------------- | ------------------------------------------------------------------- | ------------------------------ | ------------------ | ------------------------ | ---------------------------------
|Assets:                                                                  |                       |                                                                     |                                |                    |                          |                                  
|Cash and cash equivalents (Refer to Note to 2.1)                         | 4,935                 | –                                                                   | –                              | –                  | –                        | 4,935                            
|Available–for–sale financial assets (Refer to Note 2.2)                  | –                     | –                                                                   | –                              | 284                | –                        | 284                              
|Trade receivable                                                         | 1,710                 | –                                                                   | –                              | –                  | –                        | 1,710                            
|Unbilled revenue                                                         | 457                   | –                                                                   | –                              | –                  | –                        | 457                              
|Prepayments and other assets (Refer to Note 2.4)                         | 393                   | –                                                                   | –                              | –                  | –                        | 393                              
|Derivative financial instruments                                         | –                     | 17                                                                  | –                              | –                  | –                        | 17                               
|Total                                                                    | 7,495                 | 17                                                                  | –                              | 284                | –                        | 7,796                            
|Liabilities:                                                             |                       |                                                                     |                                |                    |                          |                                  
|Trade payables                                                           | –                     | –                                                                   | –                              | –                  | 58                       | 58                               
|Derivative financial instruments                                         | –                     | 1                                                                   | –                              | –                  | –                        | 1                                
|Client deposits                                                          | –                     | –                                                                   | –                              | –                  | 4                        | 4                                
|Employee benefit obligations                                             | –                     | –                                                                   | –                              | –                  | 202                      | 202                              
|Other liabilities including contingent consideration (Refer to Note 2.9) | –                     | 17                                                                  | –                              | –                  | 737                      | 754                              
|Total                                                                    | –                     | 18                                                                  | –                              | –                  | 1,001                    | 1,019                            



The carrying value and fair value of
financial instruments by categories as of March 31, 2015 were as follows:



(Dollars in millions)

|                                                        | Loans and receivables | Financial assets / liabilities at fair value throughprofit and loss | Available for sale | Trade and other payables | Total carrying value / fair value
|------------------------------------------------------- | --------------------- | ------------------------------------------------------------------- | ------------------ | ------------------------ | ---------------------------------
|Assets:                                                 |                       |                                                                     |                    |                          |                                  
|Cash and cash equivalents (Refer to Note to 2.1)        | 4,859                 | –                                                                   | –                  | –                        | 4,859                            
|Available–for–sale financial assets (Refer to Note 2.2) | –                     | –                                                                   | 355                | –                        | 355                              
|Trade receivable                                        | 1,554                 | –                                                                   | –                  | –                        | 1,554                            
|Unbilled revenue                                        | 455                   | –                                                                   | –                  | –                        | 455                              
|Prepayments and other assets (Refer to Note 2.4)        | 313                   | –                                                                   | –                  | –                        | 313                              
|Derivative financial instruments                        | –                     | 16                                                                  | –                  | –                        | 16                               
|Total                                                   | 7,181                 | 16                                                                  | 355                | –                        | 7,552                            
|Liabilities:                                            |                       |                                                                     |                    |                          |                                  
|Trade payables                                          | –                     | –                                                                   | –                  | 22                       | 22                               
|Derivative financial instruments                        | –                     | –                                                                   | –                  | –                        | –                                
|Client deposits                                         | –                     | –                                                                   | –                  | 4                        | 4                                
|Employee benefit obligations                            | –                     | –                                                                   | –                  | 171                      | 171                              
|Other liabilities (Refer to Note 2.9)                   | –                     | –                                                                   | –                  | 782                      | 782                              
|Total                                                   | –                     | –                                                                   | –                  | 979                      | 979                              



Fair value hierarchy

Level 1- Quoted prices (unadjusted)
in active markets for identical assets or liabilities.



Level 2– Inputs other than
quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly
(i.e. derived from prices).



Level 3- Inputs for the assets
or liabilities that are not based on observable market data (unobservable inputs).



The following table presents fair value
hierarchy of assets and liabilities measured at fair value on a recurring basis as of March 31, 2016:

(Dollars in millions)

|                                                                                                       | As of March 31, 2016 | Fair value measurement at end of the reporting period using
|------------------------------------------------------------------------------------------------------ | -------------------- | -----------------------------------------------------------
|                                                                                                       |                      | Level 1                                                    
|Assets                                                                                                 |                      |                                                            
|Available- for- sale financial asset- Investments in liquid mutual funds (Refer to Note 2.2)           | 10                   | 10                                                         
|Available- for- sale financial asset- Investments in quoted debt securities (Refer to Note 2.2)        | 257                  | 57                                                         
|Available- for- sale financial asset- Investments in equity and preference securities (Refer Note 2.2) | 14                   | –                                                          
|Available- for- sale financial asset- others (Refer Note 2.2)                                          | 3                    | –                                                          
|Derivative financial instruments- gain on outstanding foreign exchange forward and option contracts    | 17                   | –                                                          
|Liabilities                                                                                            |                      |                                                            
|Derivative financial instruments- loss on outstanding foreign exchange forward and option contracts    | 1                    | –                                                          
|Liability towards contingent consideration (Refer note 2.9)*                                           | 17                   | –                                                          





* Discounted $20 million at 13.7%.



A one percentage point change in the
unobservable inputs used in fair valuation of the contingent consideration does not have a significant impact in its value.



During the year ended March 31, 2016,
quoted debt securities of $50 million were transferred from Level 1 to Level 2 of fair value hierarchy, since these were valued
based on market observable inputs.



The following table presents fair value
hierarchy of assets and liabilities measured at fair value on a recurring basis as of March 31, 2015:

(Dollars in millions)

|                                                                                                        | As of March 31, 2015 | Fair value measurement at end of the reporting period using
|------------------------------------------------------------------------------------------------------- | -------------------- | -----------------------------------------------------------
|                                                                                                        |                      | Level 1                                                    
|Assets                                                                                                  |                      |                                                            
|Available- for- sale financial asset- Investments in liquid mutual funds (Refer to Note 2.2)            | 135                  | 135                                                        
|Available- for- sale financial asset- Investments in fixed maturity plan securities (Refer to Note 2.2) | 5                    | –                                                          
|Available- for- sale financial asset- Investments in quoted debt securities (Refer to Note 2.2)         | 215                  | 97                                                         
|Derivative financial instruments- gain on outstanding foreign exchange forward and option contracts     | 16                   | –                                                          
|Liabilities                                                                                             |                      |                                                            
|Derivative financial instruments- loss on outstanding foreign exchange forward and option contracts     | –                    | –                                                          



Income from financial assets or liabilities
that are not at fair value through profit or loss is as follows:



(Dollars in millions)

|                                                                             | Year ended March 31,
|---------------------------------------------------------------------------- | --------------------
|                                                                             | 2016                
|Interest income on deposits and certificates of deposit (Refer to Note 2.13) | 385                 
|Income from available-for-sale financial assets (Refer to Note 2.13)         | 27                  
|                                                                             | 412                 



Derivative financial instruments



The Group holds derivative financial
instruments such as foreign exchange forward and option contracts to mitigate the risk of changes in exchange rates on foreign
currency exposures. The counterparty for these contracts is a bank. These derivative financial instruments are valued based on
quoted prices for similar assets and liabilities in active markets or inputs that are directly or indirectly observable in the
marketplace.



The following table gives details with
respect to outstanding foreign exchange forward and option contracts:



(In millions)

|                                 | As of         
|-------------------------------- | --------------
|                                 | March 31, 2016
|Forward contracts                |               
|In U.S. dollars                  | 510           
|In Euro                          | 100           
|In United Kingdom Pound Sterling | 65            
|In Australian dollars            | 55            
|In Canadian dollars              | –             
|In Singapore dollars             | –             
|In Swiss Franc                   | 25            
|Option contracts                 |               
|In U.S. dollars                  | 125           



The Group recognized a net gain of $4 million, a net gain of $85 million and a net loss of $40 million on derivative
financial instruments for the year ended March 31, 2016,
2015 and 2014, respectively, which are included under other income.



The foreign exchange forward and option
contracts mature within 12 months. The table below analyzes the derivative financial instruments into relevant maturity groupings
based on the remaining period as of the balance sheet date:



(Dollars in millions)

|                                                     | As of         
|---------------------------------------------------- | --------------
|                                                     | March 31, 2016
|Not later than one month                             | 238           
|Later than one month and not later than three months | 516           
|Later than three months and not later than one year  | 157           
|                                                     | 911           



Financial risk management



Financial risk factors



The Group's activities expose it to a
variety of financial risks: market risk, credit risk and liquidity risk. The Group's primary focus is to foresee the unpredictability
of financial markets and seek to minimize potential adverse effects on its financial performance. The primary market risk to the
Group is foreign exchange risk. The Group uses derivative financial instruments to mitigate foreign exchange related risk exposures.
The Group's exposure to credit risk is influenced mainly by the individual characteristic of each customer and the concentration
of risk from the top few customers. The demographics of the customer including the default risk of the industry and country in
which the customer operates also has an influence on credit risk assessment.



Market risk



The Group operates internationally and
a major portion of the business is transacted in several currencies and consequently the Group is exposed to foreign exchange risk
through its sales and services in the United States and elsewhere, and purchases from overseas suppliers in various foreign currencies.
The Group holds derivative financial instruments such as foreign exchange forward and option contracts to mitigate the risk of
changes in exchange rates on foreign currency exposures. The exchange rate between the rupee and foreign currencies has changed
substantially in recent years and may fluctuate substantially in the future. Consequently, the results of the Group’s operations
are affected as the rupee appreciates/depreciates against these currencies.



The following table gives details in respect of the outstanding
foreign exchange forward and option contracts:



(Dollars in millions)

|                                                             | As of         
|------------------------------------------------------------ | --------------
|                                                             | March 31, 2016
|Aggregate amount of outstanding forward and option contracts | 911           
|Gain on outstanding forward and option contracts             | 17            
|Loss on outstanding forward and option contracts             | 1             



The following table analyzes foreign
currency risk from financial instruments as of March 31, 2016:

(Dollars in millions)

|                             | U.S. dollars | Euro | United Kingdom Pound Sterling | Australian dollars | Other currencies | Total
|---------------------------- | ------------ | ---- | ----------------------------- | ------------------ | ---------------- | -----
|Cash and cash equivalents    | 170          | 25   | 30                            | 26                 | 91               | 342  
|Trade receivables            | 1,141        | 193  | 109                           | 90                 | 105              | 1,638
|Unbilled revenue             | 282          | 56   | 29                            | 17                 | 38               | 422  
|Other assets                 | 14           | 6    | 4                             | 2                  | 12               | 38   
|Trade payables               | (19)         | (11) | (11)                          | (1)                | (11)             | (53) 
|Client deposits              | (3)          | –    | –                             | –                  | (1)              | (4)  
|Accrued expenses             | (119)        | (23) | (18)                          | (5)                | (33)             | (198)
|Employee benefit obligations | (87)         | (12) | (7)                           | (25)               | (19)             | (150)
|Other liabilities            | (159)        | (20) | (5)                           | (6)                | (32)             | (222)
|Net assets / (liabilities)   | 1,220        | 214  | 131                           | 98                 | 150              | 1,813



The following table analyzes foreign
currency risk from financial instruments as of March 31, 2015:

(Dollars in millions)

|                             | U.S. dollars | Euro | United Kingdom Pound Sterling | Australian dollars | Other currencies | Total
|---------------------------- | ------------ | ---- | ----------------------------- | ------------------ | ---------------- | -----
|Cash and cash equivalents    | 159          | 9    | 7                             | 19                 | 66               | 260  
|Trade receivables            | 1,075        | 166  | 87                            | 75                 | 96               | 1,499
|Unbilled revenue             | 274          | 53   | 20                            | 16                 | 40               | 403  
|Other assets                 | 13           | 5    | 3                             | 1                  | 10               | 32   
|Trade payables               | (9)          | (2)  | –                             | –                  | (10)             | (21) 
|Client deposits              | (3)          | –    | –                             | –                  | (1)              | (4)  
|Accrued expenses             | (120)        | (23) | (13)                          | (4)                | (26)             | (186)
|Employee benefit obligations | (70)         | (9)  | (6)                           | (21)               | (17)             | (123)
|Other liabilities            | (122)        | (19) | (4)                           | (3)                | (101)            | (249)
|Net assets / (liabilities)   | 1,197        | 180  | 94                            | 83                 | 57               | 1,611



For the years ended March 31, 2016, 2015
and 2014, every percentage point depreciation / appreciation in the exchange rate between the Indian rupee and the U.S. dollar
has affected the company's incremental operating margins by approximately 0.50%, 0.52% and 0.48%, respectively.



Sensitivity analysis is computed based
on the changes in the income and expenses in foreign currency upon conversion into functional currency, due to exchange rate fluctuations
between the previous reporting period and the current reporting period.



Credit risk



Credit risk refers to the risk of default
on its obligation by the counterparty resulting in a financial loss. The maximum exposure to the credit risk at the reporting date
is primarily from trade receivables amounting to $1,710 million and $1,554 million as of March 31, 2016 and March 31, 2015, respectively
and unbilled revenue amounting to $457 million and $455 million as of March 31, 2016 and March 31, 2015, respectively. Trade receivables
and unbilled revenue are typically unsecured and are derived from revenue earned from customers primarily located in the United
States. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness
of customers to which the group grants credit terms in the normal course of business.



The following table gives details in
respect of percentage of revenues generated from top customer and top five customers:

(In %)

|                                | Year ended March 31,
|------------------------------- | --------------------
|                                | 2016                
|Revenue from top customer       | 3.6                 
|Revenue from top five customers | 13.8                



Financial assets that are neither
past due nor impaired



Cash and cash equivalents,
available-for-sale financial assets and investment in certificates of deposit are neither past due nor impaired. Cash and
cash equivalents include deposits with banks and financial institution with high credit ratings assigned by international and
domestic credit rating agencies. Available-for-sale financial assets include investment in liquid mutual fund units, quoted
debt securities and unquoted equity and preference securities. Certificates of deposit represent funds deposited at a bank
for a specified time period. Investment in quoted debt securities represents the investments made in debt securities issued
by government and quasi government organizations. Of the total trade receivables, $1,258 million and $1,174 million as of
March 31, 2016 and March 31, 2015, respectively, were neither past due nor impaired.



There is no other class of financial
assets that is not past due but impaired except for trade receivables of $2 million and $4 million as of March 31, 2016 and March
31, 2015, respectively.



Financial assets that are past due but not impaired



The Group’s credit period generally
ranges from 30-60 days. The age analysis of the trade receivables have been considered from the due date. The age wise break up
of trade receivables, net of allowances of $42 million and $55 million as of March 31, 2016 and March 31, 2015, respectively that
are past due, is given below:



(Dollars in millions)

|Period (in days) | As of         
|---------------- | --------------
|                 | March 31, 2016
|Less than 30     | 314           
|31 – 60          | 71            
|61 – 90          | 46            
|More than 90     | 21            
|                 | 452           



The reversal of provision for doubtful
trade receivables for the year ended March 31, 2016 is $7 million. The provisions for doubtful trade receivables for the year
ended March 31, 2015 and 2014 was $29 million and $23 million, respectively.



The movement in the provisions for doubtful
trade receivables is as follows:

(Dollars in millions)

|                                          | Year ended March 31,
|----------------------------------------- | --------------------
|                                          | 2016                
|Balance at the beginning                  | 59                  
|Translation differences                   | (3)                 
|Provisions for doubtful trade receivables | (7)                 
|Trade receivables written off             | (5)                 
|Balance at the end                        | 44                  



Liquidity risk



As of March 31, 2016, the Group had a
working capital of $5,804 million including cash and cash equivalents of $4,935 million and current available-for-sale financial
assets of $11 million. As of March 31, 2015, the Group had a working capital of $5,731 million including cash and cash equivalents
of $4,859 million, current available-for-sale financial assets of $140 million.



As of March 31, 2016 and March
31, 2015, the outstanding employee benefit obligations were $202 million and $171 million, respectively, which have been substantially
funded. Further, as of March 31, 2016 and March 31, 2015, the group had no outstanding bank borrowings. Accordingly, no liquidity
risk is perceived.

The table below provides details regarding
the contractual maturities of significant financial liabilities as of March 31, 2016:

(Dollars in millions)

|Particulars                                                                                                        | Less than 1 year | 1-2 years | 2-4 years | 4-7 years | Total
|------------------------------------------------------------------------------------------------------------------ | ---------------- | --------- | --------- | --------- | -----
|Trade payables                                                                                                     | 58               | –         | –         | –         | 58   
|Client deposits                                                                                                    | 4                | –         | –         | –         | 4    
|Other liabilities (excluding liabilities towards acquisition - Refer to note 2.9)                                  | 732              | 4         | 1         | –         | 737  
|Liability towards acquisitions on an undiscounted basis (including contingent consideration) - (Refer to Note 2.9) | 13               | 7         | –         | –         | 20   



The table below provides details regarding
the contractual maturities of significant financial liabilities as of March 31, 2015:

(Dollars in millions)

|Particulars                                                                                              | Less than 1 year | 1-2 years | 2-4 years | 4-7 years | Total
|-------------------------------------------------------------------------------------------------------- | ---------------- | --------- | --------- | --------- | -----
|Trade payables                                                                                           | 22               | –         | –         | –         | 22   
|Client deposits                                                                                          | 4                | –         | –         | –         | 4    
|Other liabilities (excluding liabilities towards acquisition and incentive accruals - Refer to note 2.9) | 704              | –         | –         | –         | 704  
|Liability towards acquisitions on an undiscounted basis (Refer to Note 2.9)                              | 84               | –         | –         | –         | 84   



As of March 31, 2016 and March 31, 2015,
the Group had outstanding financial guarantees of $8 million and $7 million, respectively towards leased premises. These financial
guarantees can be invoked upon breach of any term of the lease agreement. To the Group’s knowledge there has been no breach
of any term of the lease agreement as of March 31, 2016 and March 31, 2015.



Offsetting of financial assets and
financial liabilities:



The group offsets a financial asset and
a financial liability when it currently has a legally enforceable right to set off the recognized amounts and the group intends
either to settle on a net basis, or to realize the asset and settle the liability simultaneously.



The following table provides quantitative
information about offsetting of derivative financial assets and derivative financial liabilities:

(Dollars in millions)

|                                                     | As of                      | As of                         
|---------------------------------------------------- | -------------------------- | ------------------------------
|                                                     | March 31, 2016             | March 31, 2015                
|                                                     | Derivative financial asset | Derivative financial liability
|Gross amount of recognized financial asset/liability | 18                         | (2)                           
|Amount set off                                       | (1)                        | 1                             
|Net amount presented in balance sheet                | 17                         | (1)                           



2.8 Provisions



Provisions comprise the following:

(Dollars in millions)

|                                                             | As of         
|------------------------------------------------------------ | --------------
|                                                             | March 31, 2016
|Provision for post sales client support and other provisions | 77            
|                                                             | 77            



Provision for post sales client support
and other provisions represents costs associated with providing sales support services which are accrued at the time of recognition
of revenues and are expected to be utilized over a period of 6 months to 1 year. The movement in the provision for post sales client
support and other provisions is as follows:

(Dollars in millions)

|                                  | Year ended March 31,
|--------------------------------- | --------------------
|                                  | 2016                
|Balance at the beginning          | 77                  
|Translation differences           | 1                   
|Provision recognized / (reversed) | 16                  
|Provision utilized                | (17)                
|Balance at the end                | 77                  



Provision for post sales client support
and other provisions is included in cost of sales in the consolidated statement of comprehensive income.



As of March 31, 2016 and March 31, 2015,
claims against the company, not acknowledged as debts, net of amounts paid (excluding demands from Indian income tax authorities-
Refer to Note 2.16) amounted to $42 million (277 crore) and $42 million (261 crore), respectively.



2.9 Other liabilities



Other liabilities comprise the following:

(Dollars in millions)

|                                                                                                                        | As of         
|----------------------------------------------------------------------------------------------------------------------- | --------------
|                                                                                                                        | March 31, 2016
|Current                                                                                                                 |               
|Accrued compensation to employees                                                                                       | 342           
|Accrued expenses                                                                                                        | 331           
|Withholding taxes payable (1)                                                                                           | 196           
|Retainage                                                                                                               | 12            
|Liabilities of controlled trusts                                                                                        | 25            
|Accrued gratuity                                                                                                        | –             
|Liability towards acquisition of business                                                                               | –             
|Liability towards contingent consideration (Refer note 2.3)                                                             | 12            
|Others                                                                                                                  | 22            
|                                                                                                                        | 940           
|Non-current                                                                                                             |               
|Liability towards contingent consideration (Refer note 2.3)                                                             | 5             
|Accrued compensation to employees                                                                                       | 5             
|Deferred income - government grant on land use rights (1)                                                               | 7             
|                                                                                                                        | 17            
|                                                                                                                        | 957           
|Financial liabilities included in other liabilities                                                                     | 754           
|Financial liability towards acquisitions on an undiscounted basis (including contingent consideration) - Refer note 2.3 | 20            



|(1) | Non-financial
    liabilities
|--- | -----------------------------



Accrued expenses primarily relate to
cost of technical sub-contractors, telecommunication charges, legal and professional charges, brand building expenses, overseas
travel expenses and office maintenance. Others include unpaid dividend balances and capital creditors.



2.10 Expenses by nature

(Dollars in millions)

|                                                                                | Year ended March 31,
|------------------------------------------------------------------------------- | --------------------
|                                                                                | 2016                
|Employee benefit costs                                                          | 5,236               
|Deferred purchase price pertaining to acquisition (Refer to Note 2.3)           | 23                  
|Depreciation and amortization charges (Refer to Note 2.5 and 2.6)               | 222                 
|Travelling costs                                                                | 345                 
|Consultancy and professional charges                                            | 118                 
|Rates and taxes                                                                 | 17                  
|Cost of software packages for own use                                           | 113                 
|Third party items bought for service delivery to clients                        | 81                  
|Communication costs                                                             | 68                  
|Cost of technical sub-contractors                                               | 537                 
|Power and fuel                                                                  | 33                  
|Repairs and maintenance                                                         | 160                 
|Commission to non-whole time directors                                          | 1                   
|Branding and marketing expenses                                                 | 44                  
|Provision for post-sales client support                                         | 1                   
|Provisions for doubtful trade receivables (Refer to Note 2.7)                   | (7)                 
|Operating lease payments (Refer to Note 2.14)                                   | 55                  
|Insurance charges                                                               | 9                   
|Contribution towards Corporate Social Responsibility                            | 33                  
|Others (Refer to Note 2.20)                                                     | 37                  
|Total cost of sales, selling and marketing expenses and administrative expenses | 7,126               



2.11 Employee benefits



2.11.1 Gratuity



The following tables set out the funded
status of the gratuity plans and the amounts recognized in the Group's financial statements as of March 31, 2016 and March 31,
2015:

(Dollars in millions)

|                                                                                      | As of         
|------------------------------------------------------------------------------------- | --------------
|                                                                                      | March 31, 2016
|Change in benefit obligations                                                         |               
|Benefit obligations at the beginning                                                  | 131           
|Service cost                                                                          | 18            
|Interest expense                                                                      | 9             
|Remeasurements - Actuarial losses / (gains)                                           | 3             
|Benefits paid                                                                         | (11)          
|Translation differences                                                               | (8)           
|Benefit obligations at the end                                                        | 142           
|Change in plan assets                                                                 |               
|Fair value of plan assets at the beginning                                            | 134           
|Interest Income                                                                       | 10            
|Remeasurements – Returns on plan assets excluding amounts included in interest income | 1             
|Contributions                                                                         | 17            
|Benefits paid                                                                         | (11)          
|Translation differences                                                               | (8)           
|Fair value of plan assets at the end                                                  | 143           
|Funded status                                                                         | 1             
|Prepaid gratuity benefit                                                              | 1             
|Accrued gratuity                                                                      | –             



Net gratuity cost for the year ended
March 31, 2016, 2015 and 2014 comprises the following components:

(Dollars in millions)

|                                                          | Year ended March 31,
|--------------------------------------------------------- | --------------------
|                                                          | 2016                
|Service cost                                              | 18                  
|Net interest on the net defined benefit liability / asset | (1)                 
|Net gratuity cost                                         | 17                  



Amount for the fiscal 2016, 2015 and 2014 recognized in statement
of other comprehensive income:

(Dollars in millions)

|                                                                                                                           | Year ended March 31,
|-------------------------------------------------------------------------------------------------------------------------- | --------------------
|                                                                                                                           | 2016                
|Remeasurements of the net defined benefit liability / asset                                                                |                     
|Actuarial (gains) / losses                                                                                                 | 3                   
|(Return) / loss on plan assets excluding amounts included in the net interest on the net defined benefit liability / asset | (1)                 
|Net gratuity cost                                                                                                          | 2                   



(Dollars in millions)

|                                                     | Year ended March 31,
|---------------------------------------------------- | --------------------
|                                                     | 2016                
|(Gain) / loss from change in demographic assumptions | –                   
|(Gain) / loss from change in financial assumptions   | –                   
|                                                     | –                   



The gratuity cost recognized in net profit
in the statement of comprehensive income apportioned between cost of sales, selling and marketing expenses and administrative expenses
on the basis of direct employee cost is as follows:

(Dollars in millions)

|                               | Year ended March 31,
|------------------------------ | --------------------
|                               | 2016                
|Cost of sales                  | 15                  
|Selling and marketing expenses | 1                   
|Administrative expenses        | 1                   
|                               | 17                  



The weighted-average assumptions used
to determine benefit obligations as of March 31, 2016 and March 31, 2015 are set out below:



|                                                         | As of         
|-------------------------------------------------------- | --------------
|                                                         | March 31, 2016
|Discount rate                                            | 7.8%          
|Weighted average rate of increase in compensation levels | 8.0%          



The weighted-average assumptions used
to determine net periodic benefit cost for the year ended March 31, 2016, 2015 and 2014 are set out below:



|                                                         | Year ended March 31,
|-------------------------------------------------------- | --------------------
|                                                         | 2016                
|Discount rate                                            | 7.8%                
|Weighted average rate of increase in compensation levels | 8.0%                
|Weighted average duration of defined benefit obligation  | 6.4 years           



|Discount rate                                            | In India, the market for high quality corporate bonds being not developed, the yield of government bonds is considered as the discount rate. The tenure has been considered taking into account the past long-term trend of employees’ average remaining service life which reflects the average estimated term of the post- employment benefit obligations.
|-------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Weighted average rate of increase in compensation levels | The average rate of increase in compensation levels is determined by the Company, considering factors such as, the Company’s past compensation revision trends and management’s estimate of future salary increases.                                                                                                                                        
|Attrition rate                                           | Attrition rate considered is the management’s estimate based on the past long-term trend of employee turnover in the Company.                                                                                                                                                                                                                               



Gratuity is applicable only to employees
drawing a salary in Indian rupees and there are no other foreign defined benefit gratuity plans.



The company contributes all ascertained
liabilities towards gratuity to the Infosys Employees' Gratuity Fund Trust. In case of Infosys BPO and EdgeVerve, contributions
are made to the Infosys BPO Employees' Gratuity Fund Trust and EdgeVerve Systems Limited Gratuity Fund Trust, respectively. Trustees
administer contributions made to the trusts. As of March 31, 2016 and March 31, 2015, the plan assets have been primarily invested
in insurer managed funds.



Actual return on assets for the year
ended March 31, 2016, 2015 and 2014 was $11 million, $12 million and $9 million, respectively.



As of March 31, 2016, every percentage
point increase / decrease in discount rate will affect the company’s gratuity benefit obligation by approximately $7 million.



As of March 31, 2016, every percentage
point increase / decrease in weighted average rate of increase in compensation levels will affect the company’s gratuity
benefit obligation by approximately $6 million.



The Group expects to contribute $15 million to the gratuity
trusts during the fiscal 2017.



Maturity profile of defined benefit obligation:

(Dollars in millions)

|Within 1 year | 22 
|------------- | ---
|1 - 2 year    | 22 
|2 - 3 year    | 24 
|3 - 4 year    | 25 
|4 - 5 year    | 27 
|5 - 10 years  | 137



Sensitivity for significant actuarial
assumptions is computed by varying one actuarial assumption used for the valuation of the defined benefit obligation by one percentage,
keeping all other actuarial assumptions constant.



Assumptions regarding future mortality
experience are set in accordance with the published statistics by the Life Insurance Corporation of India.



2.11.2 Superannuation



The company contributed $36 million,
$35 million and $33 million to the superannuation plan during the year ended March 31, 2016, 2015 and 2014, respectively.



Superannuation contributions have been
apportioned between cost of sales, selling and marketing expenses and administrative expenses on the basis of direct employee cost
as follows:



(Dollars in millions)

|                               | Year ended March 31,
|------------------------------ | --------------------
|                               | 2016                
|Cost of sales                  | 32                  
|Selling and marketing expenses | 3                   
|Administrative expenses        | 1                   
|                               | 36                  



2.11.3 Provident fund



Infosys has an obligation to fund any
shortfall on the yield of the trust’s investments over the administered interest rates on an annual basis. These administered
rates are determined annually predominantly considering the social rather than economic factors and in most cases the actual return
earned by the company has been higher in the past years. The actuary has provided a valuation for provident fund liabilities on
the basis of guidance issued by Actuarial Society of India and based on the below provided assumptions there is no shortfall as
at March 31, 2016 and March 31, 2015, respectively.



The details of fund and plan asset position are given below:

(Dollars in millions)

|                                                  | As of         
|------------------------------------------------- | --------------
|                                                  | March 31, 2016
|Plan assets at period end, at fair value          | 575           
|Present value of benefit obligation at period end | 575           
|Asset recognized in balance sheet                 | –             



The plan assets have been primarily invested in government
securities.



Assumptions used in determining the present
value obligation of the interest rate guarantee under the Deterministic Approach:



|                                               | As of         
|---------------------------------------------- | --------------
|                                               | March 31, 2016
|Government of India (GOI) bond yield           | 7.8%          
|Remaining term of maturity (in years)          | 7 years       
|Expected guaranteed interest rate – First Year | 8.8%          
|Thereafter                                     | 8.6%          



The Group contributed $63 million, $56
million and $48 million to the provident fund during the year ended March 31, 2016, 2015 and 2014, respectively.



Provident fund contributions have been
apportioned between cost of sales, selling and marketing expenses and administrative expenses on the basis of direct employee cost
as follows:

(Dollars in millions)

|                               | Year ended March 31,
|------------------------------ | --------------------
|                               | 2016                
|Cost of sales                  | 56                  
|Selling and marketing expenses | 5                   
|Administrative expenses        | 2                   
|                               | 63                  



2.11.4 Employee benefit costs include:

(Dollars in millions)

|                           | Year ended March 31,
|-------------------------- | --------------------
|                           | 2016                
|Salaries and bonus
    *   | 5,120               
|Defined contribution plans | 46                  
|Defined benefit plans      | 70                  
|                           | 5,236               



|* |  | Includes stock
                                         compensation expense of $1 million and less than $1 million for the year ended March
                                         31, 2016 and March 31, 2015 respectively
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The gratuity and provident plans are
applicable only to employees drawing a salary in Indian rupees and there are no other foreign defined benefit plans.



The employee benefit cost is recognized
in the following line items in the consolidated statement of comprehensive income:

(Dollars in millions)

|                               | Year ended March 31,
|------------------------------ | --------------------
|                               | 2016                
|Cost of sales                  | 4,627               
|Selling and marketing expenses | 403                 
|Administrative expenses        | 206                 
|                               | 5,236               



2.12 Equity



Share capital and share premium



The Company has only one class of shares
referred to as equity shares having a par value of 5/-. The Company has allotted 574,236,166 fully paid-up equity shares of face
value 5/- each during the three months ended December 31, 2014 pursuant to a bonus issue approved by the shareholders through postal
ballot. Further during the three months ended June 30, 2015 the Company has allotted 114,84,72,332 fully paid-up shares of face
value 5/- each pursuant to bonus issue approved by the shareholders through postal ballot. The book closure date fixed by the Board
was June 17, 2015. Bonus share of one equity share for every equity share held, and a stock dividend of one American Depositary
Share (ADS) for every ADS held, respectively, has been allotted. Consequently, the ratio of equity shares underlying the ADSs held
by an American Depositary Receipt holder remains unchanged. Options granted under the stock option plan have been adjusted for
bonus shares. 11,323,576 and 5,667,200 shares were held by controlled trust, as of March 31, 2016 and March 31, 2015, respectively.



The amount received in excess of the
par value has been classified as share premium. Additionally, share-based compensation recognized in net profit in the consolidated
statement of comprehensive income is credited to share premium. Amounts have been utilized for bonus issue from share premium account.



Retained earnings



Retained earnings represent the amount
of accumulated earnings of the Group.



Other Reserves



The Special Economic Zone
Re-investment reserve has been created out of the profit of the eligible SEZ unit in terms of the provisions of Sec
10AA(1)(ii) of Income Tax Act, 1961. The reserve should be utilized by the Company for acquiring new plant and machinery for
the purpose of its business in terms of the provisions of the Sec 10AA(2) of the Income Tax Act, 1961.



Other components of equity



Other components of equity consist of currency translation,
fair value changes on available-for-sale financial assets, remeasurement of net defined benefit liability/asset and changes in
fair value of derivatives designated as cash flow hedges.



The company’s objective when managing
capital is to safeguard its ability to continue as a going concern and to maintain an optimal capital structure so as to maximize
shareholder value. In order to maintain or achieve an optimal capital structure, the Company may adjust the amount of dividend
payment, return capital to shareholders, issue new shares or buy back issued shares. As of March 31, 2016, the company had only
one class of equity shares and had no debt. Consequent to the above capital structure, there are no externally imposed capital
requirements.



The rights of equity shareholders are
set out below.



2.12.1 Voting



Each holder of equity shares is entitled
to one vote per share. The equity shares represented by American Depositary Shares (ADS) carry similar rights to voting and dividends
as the other equity shares. Each ADS represents one underlying equity share.



2.12.2 Dividends



The Company declares and pays dividends
in Indian rupees. The remittance of dividends outside India is governed by Indian law on foreign exchange and is subject to applicable
distribution taxes.



The Board has increased dividend pay-out
ratio from up to 40% to up to 50% of post-tax consolidated profits effective fiscal 2015.



The
amount of per share dividend recognized as distributions to equity shareholders for the year ended March 31, 2016 includes final
dividend for fiscal 2015 of 29.50/-
per equity share ($0.47 per equity share) (not adjusted for June 17, 2015 bonus issue) and an interim dividend for fiscal 2016
of 10/-
per equity share ($0.15 per equity share).





The amount of per share dividend recognized
as distributions to equity shareholders for the year ended March 31, 2015 and 2014 was $1.21 (73.00) (not adjusted for bonus issue)
and $0.82 (47.00) (not adjusted for bonus issue), respectively.



The
Board of Directors, in their meeting on April 15, 2016, proposed a final dividend of 14.25
per equity share (approximately $0.22 per equity share). The proposal is subject to approval of the shareholders at the Annual
General Meeting to be held on June 18, 2016 and if approved, would result in a cash outflow of approximately $592 million (excluding
dividend paid on treasury shares), including corporate dividend tax



2.12.3 Liquidation



In the event of liquidation of the company,
the holders of shares shall be entitled to receive any of the remaining assets of the company, after distribution of all preferential
amounts. However, no such preferential amounts exist currently, other than the amounts held by irrevocable controlled trusts. The
amount distributed will be in proportion to the number of equity shares held by the shareholders. For irrevocable controlled trusts,
the corpus would be settled in favor of the beneficiaries.



2.12.4 Share options



There are no voting, dividend or liquidation
rights to the holders of options issued under the company's share option plans.



2.13 Other income



Other income consists of the following:

(Dollars in millions)

|                                                                         | Year ended March 31,
|------------------------------------------------------------------------ | --------------------
|                                                                         | 2016                
|Interest income on deposits and certificates of deposit                  | 385                 
|Exchange gains / (losses) on forward and options contracts               | 4                   
|Exchange gains / (losses) on translation of other assets and liabilities | 21                  
|Income from available-for-sale financial assets                          | 27                  
|Others                                                                   | 39                  
|                                                                         | 476                 



2.14 Operating leases



The Group has various operating leases,
mainly for office buildings, that are renewable on a periodic basis. Rental expense for operating leases was $55 million, $50 million
and $53 million for fiscal 2016, 2015 and 2014, respectively.



The schedule of future minimum rental
payments in respect of non-cancellable operating leases is set out below:

(Dollars in millions)

|                                                | As of         
|----------------------------------------------- | --------------
|                                                | March 31, 2016
|Within one year of the balance sheet date       | 56            
|Due in a period between one year and five years | 132           
|Due after five years                            | 67            



A majority of the group’s operating
lease arrangements extend up to a maximum of ten years from their respective dates of inception, and relate to rented overseas
premises. Some of these lease agreements contain a price escalation clause.



2.15 Employees' Stock Option Plans
(ESOP)



2015 Stock Incentive
Compensation Plan (the 2015 Plan):The Securities
Exchange Board of India (SEBI) issued the Securities and Exchange Board of India (Share based Employee Benefits) Regulations, 2014
(‘SEBI Regulations’) which replaced the SEBI ESOP Guidelines, 1999. The 2011 Plan (as explained below) was required
to be amended and restated in accordance with the SEBI Regulations. Consequently, to effect this change and to further introduce
stock options/ADR’s and other stock incentives, the Company put forth the 2015 Stock Incentive Compensation Plan (the 2015
Plan) for approval to the shareholders of the Company. Pursuant to the approval by the shareholders through postal ballot which
ended on March 31, 2016, the Board of Directors have been authorised 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 24,038,883 equity shares (this includes 11,223,576 equity shares which are currently held by the Trust towards
the 2011 Plan). 17,038,883 equity shares will be issued as RSUs at par value and 7,000,000 equity shares will be issued as stock
options at market price. These instruments will vest over a period of 4 years and the Company expects to grant the instruments
under the 2015 Plan over the period of 4 to 7 years.



2011 RSU Plan (the 2011 Plan):
The Company had a 2011 RSU Plan which provided for the grant of restricted stock units (RSUs) to eligible
employees of the Company. The Board of Directors recommended the establishment of the 2011 Plan to the shareholders on August 30,
2011 and the shareholders approved the recommendation of the Board of Directors on October 17, 2011 through a postal ballot. The
maximum aggregate number of shares that may be awarded under the plan was 11,334,400 (adjusted for bonus issues) and the plan was
expected to continue in effect for a term of 10 years from the date of initial grant under the plan. During the year ended March
31, 2015, the company made a grant of 108,268 restricted stock units (adjusted for bonus issues) to Dr. Vishal Sikka, Chief Executive
Office and Managing Director. The Board in its meeting held on June 22, 2015, on recommendation of Nomination and Remuneration
Committee, further granted 1,24,061 RSUs to Dr. Vishal Sikka. These RSUs are vesting over a period of four years from the date
of the grant in the proportions specified in the award agreement. The RSUs will vest subject to achievement of certain key performance
indicators as set forth in the award agreement for each applicable year of the vesting tranche and continued employment through
each vesting date. Further the Company has earmarked 100,000 equity shares for welfare activities of the employees, approved by
the shareholders through postal ballot which ended on March 31, 2016. The equity shares currently held under this plan, i.e. 11,223,576
equity shares (this includes the aggregate number of equity shares that may be awarded under the 2011 Plan as reduced by 10,824
equity shares already exercised by Dr. Vishal Sikka and 100,000 equity shares which have been earmarked for welfare activities
of the employees) have been subsumed under the 2015 Plan.



Further, the award granted to Dr. Vishal
Sikka on June 22, 2015 was modified by the Nomination and remuneration committee on April 14, 2016. There is no modification or
change in the total number of RSUs granted or the vesting period (which is four years). The modifications relate to the criteria
of vesting for each of the years. Based on the modification, the first tranche of the RSUs will vest subject to achievement of
certain key performance indicators for the year ended March 31, 2016. Subsequent vesting of RSU's for each of the remaining years
would be subject to continued employment.



The activity in the 2011 Plan during
the year ended March 31, 2016 is set out below:



|                              | Year ended March 31, 2016   
|----------------------------- | ----------------------------
|                              | Shares arisingout of options
|2011 Plan:                    |                             
|Outstanding at the beginning* | 108,268                     
|Granted                       | 124,061                     
|Forfeited and expired         | –                           
|Exercised*                    | 10,824                      
|Outstanding at the end        | 221,505                     
|Exercisable at the end        | –                           



* Adjusted for bonus issue. (Refer to note 2.12)



The weighted average share price of options exercised under
the 2011 Plan on the date of exercise was $16/-.



The activity in the 2011 Plan during
the year ended March 31, 2015 is set out below:



|                             | Year ended March 31, 2015   
|---------------------------- | ----------------------------
|                             | Shares arisingout of options
|2011 Plan:                   |                             
|Outstanding at the beginning | –                           
|Granted*                     | 108,268                     
|Forfeited and expired        | –                           
|Exercised                    | –                           
|Outstanding at the end       | 108,268                     
|Exercisable at the end       | –                           



* Adjusted for bonus issue. (Refer to note 2.12).



The weighted average remaining contractual
life of RSUs outstanding as of March 31, 2016 and March 31, 2015 under the 2011 Plan, was 1.98 years and 2.39 years respectively.



The expected term of the RSU is estimated
based on the vesting term and contractual term of the RSU, as well as expected exercise behavior of the employee who receives the
RSU. Expected volatility during the expected term of the RSU is based on historical volatility of the observed market prices of
the company's publicly traded equity shares during a period equivalent to the expected term of the RSU.



The fair value of each RSU is estimated
on the date of grant using the Black-Scholes-Merton model with the following assumptions:



|Particulars                                        | Fiscal 2016 | Fiscal 2015
|-------------------------------------------------- | ----------- | -----------
|Grant Date                                         | 22-Jun-15   | 21-Aug-14  
|Weighted average share price ($)*                  | 16          | 58         
|Exercise price ($)                                 | 0.08        | 0.08       
|Expected volatility (%)                            | 28 - 36     | 30-37      
|Expected life of the option (years)                | 1 - 4       | 1 – 4      
|Expected dividends (%)                             | 2.43        | 1.84       
|Risk-free interest rate (%)                        | 7- 8        | 8 – 9      
|Weighted average fair value as on grant date ($) * | 15          | 55         



* Data for Fiscal 2015 is not adjusted for bonus issues



During the year ended March 31, 2016 and March 31, 2015, the
company recorded an employee stock compensation expense of $1 million and less than $1 million, respectively in the statement of
comprehensive income.



2.16 Income
taxes



Income tax expense in the consolidated
statement of comprehensive income comprises:

(Dollars in
millions)

|                   | Year ended March 31,
|------------------ | --------------------
|                   | 2016                
|Current taxes      |                     
|Domestic taxes     | 642                 
|Foreign taxes      | 167                 
|                   | 809                 
|Deferred taxes     |                     
|Domestic taxes     | 3                   
|Foreign taxes      | (13)                
|                   | (10)                
|Income tax expense | 799                 



Income tax expense for the year ended
March 31, 2016, 2015 and 2014 includes reversals (net of provisions) of $47 million, $26 million and $4 million, respectively,
pertaining to earlier periods.



The
revision in the useful life of assets held at April 1, 2014 has resulted in a decrease in deferred tax credit by $29 million for
the year ended March 31, 2015. (Refer to Note 2.5)



Entire deferred income tax for fiscal
2016, 2015 and 2014 relates to origination and reversal of temporary differences.



A deferred tax liability of $1 million,
a reversal of deferred tax asset of $2 million and a reversal of deferred tax liability of $2 million relating to available-for-sale
financial assets has been recognized in other comprehensive income during fiscal 2016, 2015 and 2014, respectively.



The company, being a resident in India
as per the provisions of the Income Tax Act, 1961, is required to pay taxes in India on the global income in accordance with the
provisions of Section 5 of the Indian Income Tax Act, 1961, which is reflected as domestic taxes. The geographical segment disclosures
on revenue in note 2.19.2 are based on the location of customers and do not reflect the geographies where the actual delivery or
revenue-related efforts occur. The income on which domestic taxes are imposed are not restricted to the income generated from the
“India” geographic segment. As such, amounts applicable to domestic income taxes and foreign income taxes will not
necessarily correlate to the proportion of revenue generated from India and other geographical segments as per the geographic segment
disclosure set forth in note 2.19.2.



A reconciliation of the income tax provision
to the amount computed by applying the statutory income tax rate to the income before income taxes is summarized below:

(Dollars in millions)

|                                                             | Year ended March 31,
|------------------------------------------------------------ | --------------------
|                                                             | 2016                
|Profit before income taxes                                   | 2,851               
|Enacted tax rates in India                                   | 34.61%              
|Computed expected tax expense                                | 987                 
|Tax effect due to non-taxable income for Indian tax purposes | (268)               
|Overseas taxes                                               | 109                 
|Tax reversals, overseas and domestic (net)                   | (47)                
|Effect of exempt non-operating income                        | (13)                
|Effect of unrecognized deferred tax assets                   | 9                   
|Effect of differential overseas tax rates                    | 1                   
|Effect of non-deductible expenses                            | 30                  
|Taxes on dividend received from subsidiary                   | –                   
|Temporary difference related to branch profits tax           | –                   
|Additional deduction on research and development expense     | (9)                 
|Others                                                       | –                   
|Income tax expense                                           | 799                 



The applicable Indian corporate statutory
tax rate for the year ended March 31, 2016, 2015 and 2014 is 34.61%, 33.99% and 33.99%, respectively. The increase in the corporate
statutory tax rate to 34.61% is consequent to changes made in the Finance Act, 2015.



During the year ended March 31, 2016
and 2015, the group has claimed weighted tax deduction on eligible research and development expenditures based on the approval
received from Department of Scientific and Industrial Research (DSIR) on November 23, 2011 which has been renewed effective April
2014. The weighted tax deduction is equal to 200% of such expenditures incurred.



The foreign tax expense is due to
income taxes payable overseas, principally in the United States. In India, the company has benefited from certain tax
incentives that the Government of India had provided for export of software from the units registered under the Software
Technology Parks Scheme (STP) and the company continues to benefit from certain tax incentives for the units registered under
the Special Economic Zones Act, 2005 (SEZ). However, the income tax incentives provided by the Government of India for STP
units have expired, and income from all our STP units are now taxable. SEZ units which began the provision of services on or
after April 1, 2005 are eligible for a deduction of 100 percent of profits or gains derived from the export of services for
the first five years from the financial year in which the unit commenced the provision of services and 50 percent of such
profits or gains for a further five years. Up to 50% of such profits or gains is also available for a further five years
subject to creation of a Special Economic Zone 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. (Refer to Other Reserves under note 2.12 Equity).



As a result of these tax incentives,
a portion of the company’s pre-tax income has not been subject to tax in recent years. These tax incentives resulted in a
decrease in our income tax expense of $268 million, $273 million and $273 million for the year ended March 31, 2016, 2015 and 2014,
respectively, compared to the tax amounts that we estimate we would have been required to pay if these incentives had not been
available. The per share effect of these tax incentives computed based on both basic and diluted weighted average number of equity
shares for the year ended March 31, 2016, 2015 and 2014 was $0.12 each. The basic and diluted weighted average number of equity
shares have been adjusted for bonus issue. (Refer to Note 2.12).



The company is subject to a 15% Branch
Profit Tax (BPT) in the United States to the extent its U.S. branch's net profit during the year is greater than the increase in
the net assets of the U.S. branch during the fiscal year, computed in accordance with the Internal Revenue Code. As of March 31,
2016, Infosys' U.S. branch net assets amounted to approximately $771 million. As of March 31, 2016, the Company has provided for
branch profit tax of $51 million for its U.S branch, as the company estimates that these branch profits are expected to be distributed
in the foreseeable future.



Deferred income tax liabilities have
not been recognized on temporary differences amounting to $745 million and $615 million as of March 31, 2016 and March 31, 2015,
respectively, associated with investments in subsidiaries and branches as it is probable that the temporary differences will not
reverse in the foreseeable future.



The following table provides the details
of income tax assets and income tax liabilities as of March 31, 2016 and March 31, 2015:



|                                                         | As of         
|-------------------------------------------------------- | --------------
|                                                         | March 31, 2016
|Income tax assets                                        | 789           
|Current income tax liabilities                           | (515)         
|Net current income tax assets / (liabilities) at the end | 274           



The gross movement in the current income
tax asset / (liability) for fiscal 2016, 2015 and 2014 is as follows:

(Dollars in millions)

|                                                            | Year ended March 31,
|----------------------------------------------------------- | --------------------
|                                                            | 2016                
|Net current income tax asset / (liability) at the beginning | 203                 
|Additions through business combination                      | –                   
|Translation differences                                     | (12)                
|Income tax paid                                             | 892                 
|Current income tax expense (Refer to Note 2.16)             | (809)               
|Income tax on other comprehensive income                    | –                   
|Net current income tax asset / (liability) at the end       | 274                 



The tax effects of significant temporary
differences that resulted in deferred income tax assets and liabilities are as follows:

(Dollars in millions)

|                                               | As of         
|---------------------------------------------- | --------------
|                                               | March 31, 2016
|Deferred income tax assets                     |               
|Property, plant and equipment                  | 27            
|Computer software                              | 8             
|Trade receivables                              | 13            
|Compensated absences                           | 59            
|Accrued compensation to employees              | 10            
|Post sales clients support                     | 12            
|Others                                         | 8             
|Total deferred income tax assets               | 137           
|Deferred income tax liabilities                |               
|Temporary difference related to branch profits | (51)          
|Intangible assets                              | (38)          
|Available for sale financial assets            | (1)           
|Others                                         | (5)           
|Total deferred income tax liabilities          | (95)          
|Deferred income tax assets after set off       | 81            
|Deferred income tax liabilities after set off  | (39)          



Deferred income tax assets and deferred
income tax liabilities have been offset wherever the group has a legally enforceable right to set off current income tax assets
against current income tax liabilities and where the deferred income tax assets and deferred income tax liabilities relate to income
taxes levied by the same taxation authority.



The deferred income tax assets and deferred
income tax liabilities recoverable within and after 12 months are as follows:

(Dollars in millions)

|                                                               | As of         
|-------------------------------------------------------------- | --------------
|                                                               | March 31, 2016
|Deferred income tax assets to be recovered after 12 months     | 61            
|Deferred income tax assets to be recovered within 12 months    | 76            
|Total deferred income tax assets                               | 137           
|Deferred income tax liabilities to be settled after 12 months  | (68)          
|Deferred income tax liabilities to be settled within 12 months | (27)          
|Total deferred income tax liabilities                          | (95)          



In assessing the realizability of deferred
income tax assets, management considers whether some portion or all of the deferred income tax assets will not be realized. The
ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods
in which the temporary differences become deductible. Management considers the scheduled reversals of deferred income tax liabilities,
projected future taxable income and tax planning strategies in making this assessment. Based on the level of historical taxable
income and projections for future taxable income over the periods in which the deferred income tax assets are deductible, management
believes that the group will realize the benefits of those deductible differences. The amount of the deferred income tax assets
considered realizable, however, could be reduced in the near term if estimates of future taxable income during the carry forward
period are reduced.



The gross movement in the deferred income tax account for
fiscal 2016, 2015 and 2014 is as follows:

(Dollars in millions)

|                                                                        | Year ended March 31,
|----------------------------------------------------------------------- | --------------------
|                                                                        | 2016                
|Net deferred income tax asset at the beginning                          | 60                  
|Additions through business combination (Refer to note 2.3)              | (20)                
|Translation differences                                                 | (7)                 
|Credits/(Charge) relating to temporary differences (Refer to note 2.16) | 10                  
|Temporary difference on available-for-sale financial assets             | (1)                 
|Net deferred income tax asset at the end                                | 42                  



The credits relating to temporary differences
during fiscal 2016 are primarily on account of accrued compensation to employees and compensated absences partially offset by reversal
of credits pertaining to property plant and equipment and trade receivables. The charge relating to temporary differences during
fiscal 2015 are primarily on account of property, plant and equipment, post sales client support, available for sale financial
assets, minimum alternate tax partially offset by compensated absences and trade receivables. The credits relating to temporary
differences during fiscal 2014 are primarily on account of compensated absences, trade receivables, accrued compensation to employees,
post sales client support and property, plant and equipment.



Pursuant to the enacted changes in the
Indian Income Tax Laws effective April 1, 2007, the provisions of Minimum Alternate Tax (MAT) had been extended to income of STP
units. Further, the Finance Act, 2011, which became effective April 1, 2011, extended MAT to SEZ units and SEZ developer units.
Infosys Limited and Infosys BPO had calculated its tax liability for current domestic taxes after considering MAT. The excess tax
paid under MAT provisions being over and above normal tax liability has been fully set off against normal tax liabilities of the
subsequent years. Consequently the deferred income tax asset pertaining to MAT credit is Nil as of March 31, 2016 and March 31,
2015.



As
of March 31, 2016, claims against the group not acknowledged as debts from the Indian Income tax authorities net of amount paid
to statutory authorities of $662 million (4,383
crore) amounted to $1 million (7
crore).



As
of March 31, 2015, claims against the group not acknowledged as debts from the Indian Income tax authorities net of amount paid
to statutory authorities of $571 million (3,568
crore) amounted to less than $1 million (3
crore).



Payment
of $662 million (4,383
crore) includes demands from the Indian Income tax authorities of $624 million (4,135
crore), including interest of $185 million (1,224
crore) upon completion of their tax assessment for fiscal 2007, fiscal 2008, fiscal 2009, fiscal 2010 and fiscal 2011. $138 million
(913
crores) paid during the year ended 31st March 2016 consequent to demand from tax authorities in India for fiscal 2011 towards denial
of certain tax benefits. The company has filed an appeal with the income tax appellate authorities.



Demand for fiscal 2007, fiscal 2008 and
fiscal 2009 includes disallowance of a portion of the deduction claimed by the company under Section 10A of the income Tax Act
as determined by the ratio of export turnover to total turnover. The disallowance arose from certain expenses incurred in foreign
currency being reduced from export turnover but not reduced from total turnover. Demand for fiscal 2007, fiscal 2008, fiscal 2009,
fiscal 2010 and fiscal 2011 also includes disallowance of portion of profit earned outside India from the STP units under section
10A of the Income Tax Act and disallowance of profits earned from SEZ units under section 10AA of the Income Tax Act. The matters
for fiscal 2007, fiscal 2008 and fiscal 2009 are pending before the Commissioner of Income Tax (Appeals) Bangalore. The matter
for fiscal 2010 and fiscal 2011 is pending before Hon’ble Income Tax Appellate Tribunal (ITAT) Bangalore. The company is
contesting the demand and the management including its tax advisors believes that its position will likely be upheld in the appellate
process. The management believes that the ultimate outcome of these proceedings will not have a material adverse effect on the
Company's financial position and results of operations.



2.17 Earnings per equity share



The following is a reconciliation of
the equity shares used in the computation of basic and diluted earnings per equity share:



|Year ended March 31,                                                                                                 
|---------------------------------------------------------------------------------------------------------------------
|                                                                                                                     
|Basic earnings per equity share - weighted average number of equity shares outstanding (1)(2)                        
|Effect of dilutive common equivalent shares - share options outstanding                                              
|Diluted earnings per equity share - weighted average number of equity shares and common equivalent shares outstanding
|                                                                                                                     

(1) excludes treasury shares

(2) adjusted for bonus shares. Refer to note
2.12



For the year ended March 31, 2016, 2015
and 2014, there were no outstanding options to purchase equity shares which had an anti-dilutive effect.



2.18 Related party transactions



List of subsidiaries:



|Particulars                                                                                            | Country        | Holding as of 
|------------------------------------------------------------------------------------------------------ | -------------- | --------------
|                                                                                                       |                | March 31, 2016
|Infosys BPO Limited (Infosys BPO)                                                                      | India          | 99.98%        
|Infosys Technologies (China) Co Ltd (Infosys China)                                                    | China          | 100%          
|Infosys Technologies S. de R. L. de C. V. (Infosys Mexico)                                             | Mexico         | 100%          
|Infosys Technologies (Sweden) AB. (Infosys Sweden)                                                     | Sweden         | 100%          
|Infosys Technologies (Shanghai) Company Limited (Infosys Shanghai)                                     | China          | 100%          
|Infosys Tecnologia DO Brasil LTDA. (Infosys Brasil)                                                    | Brazil         | 100%          
|Infosys Public Services, Inc. USA (Infosys Public Services)                                            | U.S.           | 100%          
|Infosys Americas Inc., (Infosys Americas)                                                              | U.S.           | 100%          
|Infosys (Czech Republic) Limited s.r.o.(formerly Infosys BPO s. r. o) (1)                              | Czech Republic | 99.98%        
|Infosys Poland Sp Z.o.o (formerly Infosys BPO (Poland) Sp Z.o.o)(1)                                    | Poland         | 99.98%        
|Infosys BPO S.DE R.L. DE.C.V (1)(17)                                                                   | Mexico         | –             
|Infosys McCamish Systems LLC (1)                                                                       | U.S.           | 99.98%        
|Portland Group Pty Ltd(1)                                                                              | Australia      | 99.98%        
|Portland Procurement Services Pty Ltd(5)                                                               | Australia      | –             
|Infosys BPO Americas LLC.(1)(16)                                                                       | U.S            | –             
|Infosys Technologies (Australia) Pty. Limited (Infosys Australia) (2)                                  | Australia      | 100%          
|EdgeVerve Systems Limited (EdgeVerve) (7)                                                              | India          | 100%          
|Infosys Consulting Holding AG (Infosys Lodestone) (formerly Lodestone Holding AG)                      | Switzerland    | 100%          
|Lodestone Management Consultants Inc. (3)                                                              | U.S.           | 100%          
|Infosys Management Consultants Pty Limited (formerly Lodestone Management Consultants Pty Limited) (3) | Australia      | 100%          
|Infosys Consulting AG (formerly Lodestone Management Consultants AG) (3)                               | Switzerland    | 100%          
|Lodestone Augmentis AG (2) (6)                                                                         | Switzerland    | 100%          
|Lodestone GmbH (formerly Hafner Bauer & Ödman GmbH) (2) (3)                                            | Switzerland    | 100%          
|Lodestone Management Consultants (Belgium) S.A. (4)                                                    | Belgium        | 99.90%        
|Infosys Consulting GmbH  (formerly Lodestone Management Consultants GmbH)(3)                           | Germany        | 100%          
|Infosys Consulting Pte Ltd. (formerly Lodestone Management Consultants Pte Ltd)(3)                     | Singapore      | 100%          
|Infosys Consulting SAS (formerly Lodestone Management Consultants SAS) (3)                             | France         | 100%          
|Infosys Consulting s.r.o.(formerly Lodestone Management Consultants s.r.o.) (3)                        | Czech Republic | 100%          
|Lodestone Management Consultants GmbH (3)                                                              | Austria        | 100%          
|Lodestone Management Consultants Co., Ltd. (3)                                                         | China          | 100%          
|Infy
    Consulting Company Ltd. (formerly Lodestone Management Consultants Ltd.) (3)                  | UK             | 100%          
|Infy Consulting B.V. (formerly Lodestone Management Consultants B.V.) (3)                              | Netherlands    | 100%          
|Infosys Consulting Ltda (formerly Lodestone Management Consultants Ltda.) (4)                          | Brazil         | 99.99%        
|Infosys Consulting Sp. Z.o.o. (formerly Lodestone Management Consultants Sp. z.o.o. (3)                | Poland         | 100%          
|Lodestone Management Consultants Portugal, Unipessoal, Lda. (3)                                        | Portugal       | 100%          
|S.C. Infosys Consulting S.R.L.(formerly S.C. Lodestone Management Consultants S.R.L.) (3)              | Romania        | 100%          
|Infosys Consulting S.R.L. (formerly Lodestone Management Consultants S.R.L.) (3)                       | Argentina      | 100%          
|Infosys Canada Public Services Ltd.(8)                                                                 | Canada         | –             
|Infosys Nova Holdings LLC (Infosys Nova) (9)                                                           | U.S.           | 100%          
|Panaya Inc (Panaya)(10)                                                                                | U.S.           | 100%          
|Panaya Ltd (11)                                                                                        | Israel         | 100%          
|Panaya Gmbh (11)                                                                                       | Germany        | 100%          
|Panaya Pty Ltd (11)                                                                                    | Australia      | –             
|Panaya Japan Co. Ltd (11)                                                                              | Japan          | 100%          
|Skava Systems Pvt Ltd (Skava Systems)(12)                                                              | India          | 100%          
|Kallidus Inc.(Kallidus)(13)                                                                            | US             | 100%          
|Noah Consulting LLC (Noah)(14)                                                                         | US             | 100%          
|Noah Information Management Consulting Inc (Noah Canada)(15)                                           | Canada         | 100%          



|(1)  | Wholly
    owned subsidiary of Infosys BPO.                                                                    
|---- | ---------------------------------------------------------------------------------------------------------------
|(2)  | Under
    liquidation                                                                                          
|(3)  | Wholly
    owned subsidiaries of Infosys Consulting Holding AG (formerly Lodestone Holding AG)                 
|(4)  | Majority
    owned and controlled subsidiaries of Infosys Consulting Holding AG (formerly Lodestone Holding AG)
|(5)  | Wholly
    owned subsidiary of Portland Group Pty Ltd. Liquidated effective May 14, 2014                       
|(6)  | Wholly
    owned subsidiary of  Infosys Consulting AG (formerly Lodestone Management Consultants AG)           
|(7)  | Incorporated effective
    February 14, 2014. (Refer note 2.3)                                                 
|(8)  | Wholly
    owned subsidiary of Infosys Public Services, Inc. Incorporated effective December 19, 2014          
|(9)  | Incorporated
    effective January 23, 2015                                                                    
|(10) | On March 5, 2015,
    Infosys acquired 100% of the voting interest in Panaya Inc. (Refer note 2.3)             
|(11) | Wholly
    owned subsidiary of Panaya Inc.                                                                     
|(12) | On
    June 2, 2015, Infosys acquired 100% of the voting interest in Skava Systems (Refer note 2.3)            
|(13) | On June 2, 2015,
    Infosys acquired 100% of the voting interest in Kallidus Inc. (Refer note 2.3)            
|(14) | On November 16,
    2015, Infosys acquired 100% of the membership interest in Noah (Refer note 2.3)            
|(15) | Wholly owned subsidiary
    of  Noah (Refer note 2.3)                                                          
|(16) | Incorporated effective
    November 20, 2015                                                                   
|(17) | Liquidated effective
    March 15, 2016                                                                        



During the year ended March 31, 2015
and 2014, Infosys Poland Sp.Z.o.o paid a dividend of $4 million each, respectively, to its holding company, Infosys BPO and the
tax on such dividend received was $1 million each.



During the year ended March 31, 2016,
2015 and 2014, Lodestone Management Consultants AG paid a dividend of $2 million, $1 million and $8 million, respectively, to its
holding company, Lodestone Holding AG and the tax on such dividend received was Nil.



Infosys has provided guarantee for performance
of certain contracts entered into by its subsidiaries.



List of associates:



|Particulars                 | Country        | Holding as of
|--------------------------- | -------------- | -------------
|March 31, 2016              | March 31, 2015
|DWA Nova LLC (DWA Nova) (1) | US             | 16%          



|(1) |  | Associate
                                         of Infosys Nova. During the year ended March 31, 2015, Infosys Nova acquired 20% of the
                                         equity interests in DWA Nova LLC for a cash consideration of $15 million. The Company
                                         has made this investment to form a new company along with Dream Works Animation (DWA).
                                         The new company, DWA Nova LLC, will develop and commercialize image generation technology
                                         in order to provide end-to-end digital manufacturing capabilities for companies involved
                                         in the design, manufacturing, marketing or distribution of physical consumer products.
                                         As of March 31, 2016, Infosys Nova holds 16% of the equity interest in DWA Nova LLC.
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Transaction to
acquire associate’s stake:

(Dollars in millions)

|Particulars            | Year ended March 31, 2015
|---------------------- | -------------------------
|Financing transactions |                          
|Investment in DWA Nova | 15                       
|                       | 15                       



List of other related parties:



|Particulars                                                    | Country | Nature of relationship                     
|-------------------------------------------------------------- | ------- | -------------------------------------------
|Infosys Limited Employees' Gratuity Fund Trust                 | India   | Post-employment benefit plan of Infosys    
|Infosys Limited Employees' Provident Fund Trust                | India   | Post-employment benefit plan of Infosys    
|Infosys Limited Employees' Superannuation Fund Trust           | India   | Post-employment benefit plan of Infosys    
|Infosys BPO Limited Employees’ Superannuation Fund Trust       | India   | Post-employment benefit plan of Infosys BPO
|Infosys BPO Limited Employees’ Gratuity Fund
        Trust     | India   | Post-employment benefit plan of Infosys BPO
|EdgeVerve Systems Limited Employees‘ Gratuity Fund Trust       | India   | Post-employment benefit plan of EdgeVerve  
|EdgeVerve Systems Limited Employees’ Superannuation Fund Trust | India   | Post-employment benefit plan of EdgeVerve  
|Infosys Limited Employees’ Welfare Trust                       | India   | Controlled Trust                           
|Infosys Employee Welfare Trust                                 | India   | Controlled Trust                           
|Infosys Science Foundation                                     | India   | Controlled Trust                           



Refer to Note 2.11 for information on
transactions relating to the post-employment benefit plans mentioned above.



Transactions with key management personnel



The table below describes the compensation
to key management personnel which comprises directors and executive officers:

(Dollars in millions)

|                                                                                                  | Year ended March 31,
|------------------------------------------------------------------------------------------------- | --------------------
|                                                                                                  | 2016                
|Salaries and other employee benefits to whole-time directors and executive officers(1)(2) (3) (4) | 15                  
|Commission and other benefits to non-executive / independent directors                            | 2                   
|Total                                                                                             | 17                  



|(1) | Includes
    employee stock compensation expense of  $1 million and less than $1 million for the year ended March 31, 2016 and
    March 31, 2015, respectively to CEO in line with the compensation plan approved by the shareholders.                                                                                                                                                                                                                                                         
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Includes
    payables to CFO who stepped down w.e.f October 12, 2015.                                                                                                                                                                                                                                                                                                                                                                                                                           
|(3) | Includes
    payment of variable pay amounting to $2.1 million for the year ended March 31, 2015 to CEO as decided by the Nomination and
    Remuneration committee on June 22, 2015 in line with the compensation plan approved by the shareholders.                                                                                                                                                                                                                                           
|(4) | Includes
provision for variable pay amounting to $4.33 million for the year ended March 31, 2016 to CEO. The shareholders in the EGM dated July 30, 2014 had approved
a variable pay of $4.18 million at a target level and also authorized the Board to alter and vary the terms of remuneration. Accordingly,
the Board based on the recommendations of the Nomination and Remuneration Committee approved on April 15, 2016, $4.33 million
as variable pay for the year ended March 31, 2016.



2.19 Segment reporting



IFRS 8 establishes standards for the
way that public business enterprises report information about operating segments and related disclosures about products and services,
geographic areas, and major customers. The Company's operations predominantly relate to providing end-to-end business solutions
to enable clients to enhance business performance. During the year ended March 31, 2016, the Company reorganized some of its segments
to enhance executive customer relationships, improve focus of sales investments and increase management oversight. Consequent to
the internal reorganization, Growth Markets (GMU) comprising enterprises in APAC (Asia Pacific) and Africa have been subsumed across
the other verticals and businesses in India, Japan and China are run as standalone regional business units and Infosys Public services
(IPS) is reviewed separately by the Chief Operating Decision Maker (CODM). Further, the erstwhile manufacturing segment is now
being reviewed as Hi-Tech, Manufacturing and others included in ECS. Consequent to the internal reorganizations, there were changes
effected in the reportable business segments based on the "management approach" as defined in IFRS 8, Operating Segments.
The CODM evaluates the Company's performance and allocates resources based on an analysis of various performance indicators by
business segments and geographic segments. Accordingly, information has been presented both along business segments and geographic
segments. The accounting principles used in the preparation of the financial statements are consistently applied to record revenue
and expenditure in individual segments, and are as set out in the significant accounting policies.



Business segments of the Company are primarily enterprises in Financial Services (FS), enterprises in Manufacturing
(MFG), enterprises in Retail, Consumer packaged goods and Logistics (RCL), enterprises in the Energy & utilities, Communication
and Services (ECS), enterprises in Hi-Tech (Hi-Tech), enterprises in Life Sciences, Healthcare and Insurance (HILIFE) and all other
segments. The FS reportable segments has been aggregated to include the Financial Services operating segment and the Finacle operating
segment because of the similarity of the economic characteristics. All other segments represents the operating segments of businesses
in India, Japan and China and IPS. Geographic segmentation is based on business sourced from that geographic region and delivered
from both on-site and off-shore locations. North America comprises the United States of America, Canada and Mexico, Europe includes
continental Europe (both the east and the west), Ireland and the United Kingdom, and the Rest of the World comprising all other
places except those mentioned above and India. Consequent to the above changes in the composition of reportable business segments,
the prior period comparatives have been restated.



Revenue and identifiable operating expenses
in relation to segments are categorized based on items that are individually identifiable to that segment. Revenue for “all
other segments” represents revenue generated by IPS and revenue generated from customers located in India, Japan and China.
Allocated expenses of segments include expenses incurred for rendering services from the Company's offshore software development
centers and on-site expenses, which are categorized in relation to the associated turnover of the segment. Certain expenses such
as depreciation, which form a significant component of total expenses, are not specifically allocable to specific segments as the
underlying assets are used interchangeably. Management believes that it is not practicable to provide segment disclosures relating
to those costs and expenses, and accordingly these expenses are separately disclosed as "unallocated" and adjusted against
the total income of the Company.



Assets and liabilities used in the Company's
business are not identified to any of the reportable segments, as these are used interchangeably between segments. Management believes
that it is currently not practicable to provide segment disclosures relating to total assets and liabilities since a meaningful
segregation of the available data is onerous.



Geographical information on revenue and
business segment revenue information is collated based on individual customers invoiced or in relation to which the revenue is
otherwise recognized.





2.19.1 Business segments



(Dollars in millions)



|Year ended March 31, 2016                                  | FS    | MFG   | ECS   | RCL   | HILIFE | Hi-Tech | All other segments | Total
|---------------------------------------------------------- | ----- | ----- | ----- | ----- | ------ | ------- | ------------------ | -----
|Revenues                                                   | 2,590 | 1,047 | 2,061 | 1,556 | 1,231  | 756     | 260                | 9,501
|Identifiable operating expenses                            | 1,248 | 555   | 944   | 742   | 585    | 371     | 156                | 4,601
|Allocated expenses                                         | 606   | 257   | 505   | 381   | 302    | 185     | 65                 | 2,301
|Segment profit                                             | 736   | 235   | 612   | 433   | 344    | 200     | 39                 | 2,599
|Unallocable expenses                                       |       |       |       |       |        |         |                    | 224  
|Operating profit                                           |       |       |       |       |        |         |                    | 2,375
|Other income, net                                          |       |       |       |       |        |         |                    | 476  
|Share in associate's profit / (loss)                       |       |       |       |       |        |         |                    | –    
|Profit before Income taxes                                 |       |       |       |       |        |         |                    | 2,851
|Income tax expense                                         |       |       |       |       |        |         |                    | 799  
|Net profit                                                 |       |       |       |       |        |         |                    | 2,052
|Depreciation and amortisation                              |       |       |       |       |        |         |                    | 222  
|Non-cash expenses other than depreciation and amortisation |       |       |       |       |        |         |                    | 2    



(Dollars in millions)

|Year ended March 31, 2015                                  | FS    | MFG   | ECS   | RCL   | HILIFE | Hi–Tech | All other segments | Total
|---------------------------------------------------------- | ----- | ----- | ----- | ----- | ------ | ------- | ------------------ | -----
|Revenues                                                   | 2,352 | 1,008 | 1,962 | 1,449 | 1,094  | 640     | 206                | 8,711
|Identifiable operating expenses                            | 1,115 | 533   | 895   | 658   | 521    | 313     | 154                | 4,189
|Allocated expenses                                         | 541   | 245   | 478   | 353   | 266    | 156     | 50                 | 2,089
|Segment profit                                             | 696   | 230   | 589   | 438   | 307    | 171     | 2                  | 2,433
|Unallocable expenses                                       |       |       |       |       |        |         |                    | 175  
|Operating profit                                           |       |       |       |       |        |         |                    | 2,258
|Other income, net                                          |       |       |       |       |        |         |                    | 560  
|Share in associate's profit / (loss)                       |       |       |       |       |        |         |                    | –    
|Profit before Income taxes                                 |       |       |       |       |        |         |                    | 2,818
|Income tax expense                                         |       |       |       |       |        |         |                    | 805  
|Net profit                                                 |       |       |       |       |        |         |                    | 2,013
|Depreciation and amortisation                              |       |       |       |       |        |         |                    | 175  
|Non-cash expenses other than depreciation and amortisation |       |       |       |       |        |         |                    | –    



(Dollars in millions)

|Year ended March 31, 2014                                  | FS    | MFG | ECS   | RCL   | HILIFE | Hi–Tech | All other segments | Total
|---------------------------------------------------------- | ----- | --- | ----- | ----- | ------ | ------- | ------------------ | -----
|Revenues                                                   | 2,239 | 934 | 1,833 | 1,425 | 1,025  | 585     | 208                | 8,249
|Identifiable operating expenses                            | 1,046 | 499 | 821   | 671   | 480    | 279     | 133                | 3,929
|Allocated expenses                                         | 547   | 244 | 478   | 372   | 267    | 153     | 54                 | 2,115
|Segment profit                                             | 646   | 191 | 534   | 382   | 278    | 153     | 21                 | 2,205
|Unallocable expenses                                       |       |     |       |       |        |         |                    | 226  
|Operating profit                                           |       |     |       |       |        |         |                    | 1,979
|Other income, net                                          |       |     |       |       |        |         |                    | 440  
|Share in associate's profit / (loss)                       |       |     |       |       |        |         |                    | –    
|Profit before Income taxes                                 |       |     |       |       |        |         |                    | 2,419
|Income tax expense                                         |       |     |       |       |        |         |                    | 668  
|Net profit                                                 |       |     |       |       |        |         |                    | 1,751
|Depreciation and amortisation                              |       |     |       |       |        |         |                    | 226  
|Non-cash expenses other than depreciation and amortisation |       |     |       |       |        |         |                    | –    



2.19.2 Geographic segments

(Dollars in millions)

|Year ended March 31, 2016                                  | North America | Europe | India | Rest of the World | Total
|---------------------------------------------------------- | ------------- | ------ | ----- | ----------------- | -----
|Revenues                                                   | 5,957         | 2,186  | 246   | 1,112             | 9,501
|Identifiable operating expenses                            | 2,936         | 1,060  | 109   | 496               | 4,601
|Allocated expenses                                         | 1,459         | 534    | 51    | 257               | 2,301
|Segment profit                                             | 1,562         | 592    | 86    | 359               | 2,599
|Unallocable expenses                                       |               |        |       |                   | 224  
|Operating profit                                           |               |        |       |                   | 2,375
|Other income, net                                          |               |        |       |                   | 476  
|Share in associate's profit / (loss)                       |               |        |       |                   | –    
|Profit before income taxes                                 |               |        |       |                   | 2,851
|Income tax expense                                         |               |        |       |                   | 799  
|Net profit                                                 |               |        |       |                   | 2,052
|Depreciation and amortization                              |               |        |       |                   | 222  
|Non-cash expenses other than depreciation and amortization |               |        |       |                   | 2    



(Dollars in millions)

|Year ended March 31, 2015                                  | North America | Europe | India | Rest of the World | Total
|---------------------------------------------------------- | ------------- | ------ | ----- | ----------------- | -----
|Revenues                                                   | 5,357         | 2,097  | 209   | 1,048             | 8,711
|Identifiable operating expenses                            | 2,558         | 1,028  | 115   | 488               | 4,189
|Allocated expenses                                         | 1,303         | 508    | 44    | 234               | 2,089
|Segment profit                                             | 1,496         | 561    | 50    | 326               | 2,433
|Unallocable expenses                                       |               |        |       |                   | 175  
|Operating profit                                           |               |        |       |                   | 2,258
|Other income, net                                          |               |        |       |                   | 560  
|Profit before income taxes                                 |               |        |       |                   | 2,818
|Income tax expense                                         |               |        |       |                   | 805  
|Net profit                                                 |               |        |       |                   | 2,013
|Depreciation and amortization                              |               |        |       |                   | 175  
|Non-cash expenses other than depreciation and amortization |               |        |       |                   | –    



(Dollars in millions)

|Year ended March 31, 2014                                  | North America | Europe | India | Rest of the World | Total
|---------------------------------------------------------- | ------------- | ------ | ----- | ----------------- | -----
|Revenues                                                   | 5,005         | 2,015  | 213   | 1,016             | 8,249
|Identifiable operating expenses                            | 2,385         | 990    | 109   | 445               | 3,929
|Allocated expenses                                         | 1,318         | 512    | 46    | 239               | 2,115
|Segment profit                                             | 1,302         | 513    | 58    | 332               | 2,205
|Unallocable expenses                                       |               |        |       |                   | 226  
|Operating profit                                           |               |        |       |                   | 1,979
|Other income, net                                          |               |        |       |                   | 440  
|Profit before income taxes                                 |               |        |       |                   | 2,419
|Income tax expense                                         |               |        |       |                   | 668  
|Net profit                                                 |               |        |       |                   | 1,751
|Depreciation and amortization                              |               |        |       |                   | 226  
|Non-cash expenses other than depreciation and amortization |               |        |       |                   | –    



2.19.3 Significant clients



No client individually accounted for
more than 10% of the revenues for the year ended March 31, 2016, 2015 and 2014.



2.20 Litigation



In
2011, U.S. Department of Homeland Security (“DHS”) reviewed the company’s employer eligibility verifications
on Form I-9 with respect to its employees working in the United States. In connection with this review, the company was advised
that the DHS has found errors in a significant percentage of its Forms I-9.



On
October 30, 2013, the company settled the foregoing matters and entered into a Settlement Agreement (“Settlement Agreement”)
with the U.S. Attorney, the DHS and the United States Department of State (“State,” and collectively with the U.S.
Attorney and the DHS, the “United States”).



In
the Settlement Agreement, the company denied and disputed all allegations made by the United States, except for the allegation
that the company failed to maintain accurate Forms I-9 records for many of its foreign nationals in the United States in 2010
and 2011 as required by law, and that such failure constituted civil violations of certain laws.



During
the year ended March 31, 2014, the Company recorded a charge related to the settlement agreement (including legal costs) of $35
million related to the matters that were the subject of the Settlement agreement. The said amount was paid prior to December 31,
2013.



In
addition, the company is subject to legal proceedings and claims, which have arisen in the ordinary course of business. The company’s
management does not reasonably expect that these legal actions, when ultimately concluded and determined, will have a material
and adverse effect on the company’s results of operations or financial condition.



Financial Statement Schedule - II



(Schedule II of Reg. §210.5-04(c)
of Regulation S-X-17 of the Securities Act of 1933 and Securities Exchange Act of 1934)



Valuation and qualifying accounts



Provisions for doubtful trade receivables

(Dollars in millions)

|Description | Balance at beginning of the year | Translation differences | Charged to cost and expenses | Write offs | Balance at end of the year
|----------- | -------------------------------- | ----------------------- | ---------------------------- | ---------- | --------------------------
|Fiscal 2016 | 59                               | (3)                     | (7)                          | (5)        | 44                        
|Fiscal 2015 | 36                               | (4)                     | 29                           | (2)        | 59                        
|Fiscal 2014 | 17                               | –                       | 23                           | (4)        | 36                        



Item 19. Exhibits



|Exhibit number | Description of document                                                                                                                                                                                                                
|-------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|*1.1           | Articles of Association of the Registrant, as amended                                                                                                                                                                                  
|1.2            | Memorandum of Association of the Registrant, as amended                                                                                                                                                                                
|*1.3           | Certificate of Incorporation of the Registrant, as currently in effect                                                                                                                                                                 
|***4.1         | Form of Deposit Agreement among the Registrant, Deutsche Bank Trust Company Americas and holders from time to time of American Depositary Receipts issued thereunder (including as an exhibit, the form of American Depositary Receipt)
|****4.2        | Registrant’s 2011 RSU Plan                                                                                                                                                                                                             
|4.3            | Registrant’s 2015 Stock Incentive Compensation Plan                                                                                                                                                                                    
|**4.5          | Employees Welfare Trust Deed of Registrant Pursuant to Employee Stock Offer Plan                                                                                                                                                       
|*****4.6       | Form of Indemnification Agreement                                                                                                                                                                                                      
|*4.7           | Form of Employment Agreement with the Chief Operating Officer                                                                                                                                                                          
|*4.8           | Form of Employment Agreement with the Chief Executive Officer                                                                                                                                                                          
|4.9            | Form of New Employment Agreement with the Chief Executive Officer                                                                                                                                                                      
|8.1            | List of Subsidiaries                                                                                                                                                                                                                   
|*11.1          | Whistleblower Policy                                                                                                                                                                                                                   
|*11.2          | Code of Conduct and Ethics                                                                                                                                                                                                             
|12.1           | Certification of Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                                           
|12.2           | Certification of Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                                           
|13.1           | Certification of Chief Executive Officer under Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                           
|13.2           | Certification of Chief Financial Officer under Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                           
|**15.1         | Registrant’s Specimen Certificate for Equity Shares                                                                                                                                                                                    
|*15.2          | Audit Committee Charter                                                                                                                                                                                                                
|*15.3          | Corporate Social Responsibility Committee Charter                                                                                                                                                                                      
|*15.4          | Nomination and Remuneration Committee Charter                                                                                                                                                                                          
|*15.5          | Risk and Strategy Committee Charter                                                                                                                                                                                                    
|15.6           | Finance and Investment Committee Charter                                                                                                                                                                                               



|*     | Incorporated
    by reference to exhibits filed with the Registrant’s Annual Report on Form 20-F filed on May 20, 2015.                                                                                                                                                                                                                                                                                                                                                                                                     
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|**    | Incorporated
    by reference to exhibits filed with the Registrant’s Registration Statement on Form F-1 (File No. 333-72195) in the
    form declared effective on March 9, 1999.                                                                                                                                                                                                                                                                                                                                          
|***   | Incorporated
    by reference to the exhibits filed with Post-Effective Amendment No. 1 to the Registrant’s Registration Statement on
    Form F-6 (File No. 333-72199) filed on March 28, 2003, as amended by Amendment No. 1 included in the exhibits filed with Post-Effective
    Amendment No. 2 to such Registration Statement filed on June 30, 2004 and Amendment No. 2 included in the exhibits filed with
    the Registrant’s Registration Statement on Form F-6 (File No. 333-200730) filed on December 4, 2014.
|****  | Incorporated
    by reference to exhibits filed with the Registrant’s Form S-8 filed on August 4, 2014.                                                                                                                                                                                                                                                                                                                                                                                                                     
|***** | Incorporated
    by reference to exhibits filed with Registrant’s Annual Report on Form 20-F filed on May 13, 2013.                                                                                                                                                                                                                                                                                                                                                                                                         








SIGNATURES



The registrant hereby certifies that
it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this
annual report on its behalf.



|                  | Infosys Limited
        /s/ David D. Kennedy                                                            
|----------------- | --------------------------------------------------------------------------------------------------------
|                  |                                                                                                         
|                  |                                                                                                         
|Date May 18, 2016 | David D. Kennedy
        Executive Vice President – General
        Counsel and Chief Compliance Officer