The Hindu Business Line : Wipro to hike wages; margins may be hit

Wipro expects a 1.5 per cent impact on its operating margins for the December quarter, as it plans to implement a wage hike for its offshore employees effective November 1.

"The average salary hike will be around 12 per cent," said Mr Suresh Senapaty, CFO, Wipro.

"In spite of the impact of wage hike, we plan to keep our margins range-bound through operational efficiency by improving the offshore leverage and employee utilisation," Mr Senapaty said. Wipro also expects to raise the salaries for its onsite employees in the fourth quarter of the current fiscal, he said.

Mr Senapaty said he foresaw a stable price regime, wherein growth would be volume-driven. The company had outstanding forex contracts worth $570 million, Mr Senapaty said adding the company did not have plans to buy more forward cover.

Wipro Infotech to focus on SMBs: Mr Suresh Vaswani, President, Wipro Infotech, said that his division would focus on the small and medium businesses in India as part of the growth strategy. Wipro Infotech hitherto was focussing on the top 1,000 firms in the country.

"As part of our renewed strategy, we plan to go after the top 5,000 firms in the country," Mr Vaswani said. "SMB can be lucrative as far as the hardware segment is concerned and we are looking at providing a host of integrated solution offerings to this segment," he said.

In the September quarter, Wipro Infotech, which accounted for 16 per cent of Wipro's revenues, won five SAP implementation deals from SMBs, he said. As part of its remote delivery strategy, Wipro Infotech was evaluating the possibility of tie-ups with smaller players, Mr Vaswani said.

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