The Hindu Business Line : Wipro Q4 net, revenue rise 39%

TEAM WIPRO: Mr Azim Premji, Chairman, Wipro (4th from left), and Mr Suresh Senapaty, Chief Financial Officer (3rd from left), with other senior officials at a press conference in Bangalore on Friday. — G R N Somashekar

Bangalore April 20 Continuing with its track record of a consistent growth, Wipro Ltd beat street estimates and its own projections to post a year-on-year profit and revenue growth of 39 per cent each for the quarter-ended March 31, 2007.

Aided by a tax write-back of Rs 70 crore, Wipro reported a net profit of Rs 856 crore on revenues of Rs 4,333 crore as compared to a net of Rs 617 crore on revenues of Rs 3,113 crore in corresponding period last year.

For year-ended March 31, 2007, Wipro reported a 42 per cent growth in net profit at Rs 2,942 crore, while revenues grew 41 per cent to Rs 15,001 crore.

`Strong growth'

"All our business segments contributed to the strong growth in revenue and profits in FY07," said Mr Azim Premji, Chairman, Wipro Ltd. "Our investments in differentiated service lines such as technology infrastructure services, testing services and enterprise applications services are yielding good results," Mr Premji said.

Following the results, Wipro stock edged up on the BSE to hit an intra-day high of Rs 600 before closing at Rs 570, a loss of 1.4 per cent over previous close.

Sounding bullish on the prospects for the year ahead, Mr Premji said, "There is nothing in terms of the environment in Europe, Japan or the US, which is a cause of concern. We have seen no forward signs of the slowdown in US economy."

Wipro expects revenues for its global IT business to be about $711 million, a year-on-year growth of 32 per cent, and a sequential rise of some three per cent.

Adverse impact

The Chief Financial Officer, Mr Suresh Senapaty, said a 5.4 per cent volume growth driven by a 1.3 per cent increase in realisations coupled with improved profitability in acquisitions and BPO operations helped Wipro offset the adverse impact of onsite wage hikes and exchange rate movement on profitability.

Operating margins of Wipro's acquisitions portfolio improved by more than 900 basis points sequentially. A strong rupee impacted operating margins by 30 basis points, while the salary hike impacted by 50 basis points. Wipro increased the salaries of its onsite employees by 3-4 per cent effective January 1, 2007.

"Despite investments in acquisitions and sales and marketing, which impacted the margins by 80 basis points, we have maintained operating margins at 24.3 per cent for FY07, marginally lower than the previous year," Mr Senapaty said. Operating margins for the March quarter stood at 24 per cent. "Further, we expect to maintain the margins in a narrow range in the medium-to-long term because of the multiple levers we have," he added.

Upping headcount

Wipro added 44 new clients this quarter. It also added 14,076 employees on a net basis, comprising 12,699 in its IT services business and 1,377 in BPO business during the year, taking its total headcount to 67,818. Wipro saw its attrition increase marginally to 16.9 per cent in March quarter due to seasonal factors.

More Stories on : Financial Performance | Software | Financial Performance | Wipro Ltd

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Wheat shipment from Pak arriving next week

Early monsoon onset, good July rains likely

Publicising pulses import decision can hurt India's interests

Helping rich to become super-rich

Rlys may float first tender for bulk buying of bio-diesel

Singhvi: `I enjoyed good relationship with Holcim'

`Priority for inflation control'

Costlier primary articles push inflation rate up over 6%

Forex reserves: Passing the buck to banks

Mutual funds scale up tech stocks exposure

Wipro Q4 net, revenue rise 39%

India Cements posts 9-fold rise in net

Ambuja Cements Q1 net increases 43%

Satyam Q4 net rises 38%

IIMs defer release of admissions list

HCL Tech, Saudi co in pact