India’s third largest IT outsourcer Wipro beat street expectations to record a 27 per cent increase in net profit to Rs 2,010 crore clearly showing early signs of stability and consistency.
T. K. Kurien, CEO of Wipro, who completes three years in office, however, struck a cautious note. “We are still a work in progress.”
But reorganisation and portfolio realignment have started yielding results with investments in automation helping operating margin expand by 54 basis points. Year-on-year, revenues rose 18 per cent to Rs 11,330 crore. The net profit was marginally impacted as the company discontinued its hardware manufacturing business in the quarter.
Revenues from IT services touched Rs 10,330 crore, an increase of 20 per cent, while net profit touched Rs 2,380 crore, up 33 per cent year-on-year.
Wipro also forecast revenues from its main IT services business growing 2-4 per cent at $1.71-1.75 billion for the quarter ending in March. “We give only quarterly guidance but from our conversations with clients, this year looks better than the last one,” said Kurien.
“We believe that the initial signs of gains from restructuring initiatives have started showing,” said Ankita Somani, IT research analyst at Angel Broking.