Infosys Chairman and chief mentor N R Narayana Murthy today expressed "guarded optimism" over the global recovery prospects, which are directly linked with software business of domestic IT majors.

Addressing the 29th Annual General Meeting of Infosys Murthy said it is tough to say whether the eurozone crisis would hit the IT bellwether company.

"At this point, we do not see any impact on us but who knows how it will cascade and what will be its impact and whether it would have any impact on corporations and IT budgets. It is difficult to say," he said.

To a question whether it would be wrong strategy to focus on Europe due to the crisis, Murthy said he did not agree that Europe should not be the focus because of the crisis.

The company, he said was also focusing on Asia Pacific, China, Latin America and Brazil. "I suppose we will have a basket.. a portfolio of companies so that such impact is minimised," said Murthy.

He assured investors that the company continued to "make investments in building capabilities". It had focused on driving and leveraging the emerging innovation trends and had partnered with corporations to help them build enterprises, he told the shareholders.

On the global recovery he struck a cautious note. "I look ahead with guarded optimism," he said.

Following the global financial meltdown in late 2008, many corporations cut their IT budgets severely impacting the software business of domestic companies like Infosys which earn most of their revenues from developed markets.

"The global output is expected to grow by more than four per cent. However, we cannot ignore the threats from the highly leveraged economies. The early signs of coming out of recession cannot be taken for granted," he said.

Later explaining his reasons for guarded optimism, he said that with the situation as of now "still being fluid", there were reasons for guarded optimism.

"There were some signs of positive optimism and some signs of concerns," he said.

He said it was difficult to say when the situation would be clear. While one hand there was the Greek crisis on the other hand some economies were coming out recession. It is "mixed".

Recovery could be slow and weak as there were some signs of concerns like the Greek crisis. .

"This industry has got used to currency volatility", Murthy said, adding, that the industry had developed methods to handle it like hedging. Sounding a practical note, he said "It is part of the environment, we accept it and move on".

Infosys, as a company, he said had managed its margins despite odds. "We have levers and we will use the levers," he said when asked about managing its margins.

Talking about year 2009, he said it had been tough for everyone. Infosys, he said had experienced unprecedented challenges, but had navigated these difficult times successfully. The company concluded fiscal 2010 with an excellent quarter. As per IFRS, the annual revenues for the fiscal 2010 were US dollar 4,804 million, year-on-year growth of three percent. The net income was US dollar 1,313 million a year-on-year growth of 2.5 per cent.

Murthy said that the Board had appointed Marti Subrahmanyam as the Lead Independent Director. Marti succeeds Deepak Satwalekar in this role. He also registered his appreciation to Rama Bijapurkar who had served as member of the board.

S D Shibulal, COO, Infosys who presented the operational highlights during the meeting said that the company's sustained engagement with shareholders with focus on strengthening its relationship with clients and trying to be relevant to them would drive the company in future.

Balakrishnan, CFO, while presenting the financial performance in a presentation laced with apt Hindi film songs said, "We managed a tough year of the industry very well."

The AGM saw shareholders asking questions ranging from the impact of the European crisis, the plans for inorganic expansion, its programmes under corporate social responsibility, its HR and education initiatives, to the issue of salaries. The shareholders also offered suggestions regarding green initiatives, to focusing on innovations.

Murthy clarified that the AGM report was thinner as it was in line with the company strategy to minimise use of paper by posting the details on website.

He also clarified the company's role in helping build houses in North Karnataka which was ravaged by floods.