Aided by fortuitous currency movements, Wipro, on Friday, reported rupee-denominated net profit growth of 11 per cent (year-on-year) during the quarter ending June 30, 2013.
The company announced a net profit of Rs.1,623 crore during the quarter.
However, dollar-denominated revenues from IT services grew at 4.85 per cent to $1,588.3 million in the last quarter from $1,514.9 million in the corresponding quarter of the previous year.
Revenue growth in sequential terms was a mere 0.2 per cent. The company’s operating profit was 20 per cent during the quarter, a full percentage point lower in the year-ago quarter.
Consolidated revenues amounted to Rs.9,735 crore, an increase of 5 per cent over the previous year.
Optimistic guidance
'Wipro Executive Director and CEO T. K. Kurien said the “pick-up in deal closures” during the quarter pointed to favourable outcomes during the remaining part of the year. This, he said, was the basis for the optimistic guidance for the third quarter.
The company expects revenues during the second quarter to be in the $1,620 million to $1,650 million range, which, compared to the third quarter of the last year, would imply an increase range between 2.71 per cent and 4.62 per cent.
Mr. Kurien said the company’s performance in the energy and utilities and retail verticals was strong, but that it was ‘soft’ in the areas of investment banking and telecom. The company added 28 new clients during the quarter.
Suresh Senapaty, Executive Director and Chief Financial Officer, said revenues from Indian operations were affected by the “disenchanted (economic) outlook.”
Constraints in government spending, the slowdown in manufacturing and infrastructure sectors, currency volatility and the “hardening” of interest rates were part of the pessimistic picture.
Mr. Kurien said the deal pipeline ‘looks flat,’ but that the “deal closure rates are looking up.”
He said the indications from the U.S. were positive and that ‘parts’ of Europe were looking up. Pratik Kumar, Executive Vice-President, Human Resources, said Wipro’s ‘bias’ in recruiting from campuses would continue, although he said the industry’s intake would slow down in the next 2-3 years.
