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G R N Somashekar

Good numbers: Mr Azim Premji, Chairman, Wipro (right), and Mr Suresh Senapaty, Chief Finance Officer, at a press meet in Bangalore on Friday. —

Our Bureau

Bangalore, Oct 19 A broad-based growth across all its verticals and service lines helped Wipro Ltd to beat street estimates and its own forecast to post 18 per cent rise in net profits for the September quarter (Q2FY08) over corresponding last year.

Wipro reported a net profit of Rs 823.7 crore on revenue of Rs 4,784.7 crore as compared to a net of Rs 700 crore on revenue of Rs 3,546 crore in Q2FY07. Sequentially, the net profits and revenues were up 14 per cent each.

Backed by better realisations and healthy client additions, Wipro forecast a record sequential earnings growth of 13.6 per cent for its Global IT business for December quarter, with revenues expected to be at $905 million.

Wipro shares ended 0.83 per cent higher at Rs 500.55 on the BSE on Friday outperforming Sensex’s decline of 2.44 per cent.

In Q2, the global IT revenues grew 10 per cent quarter-on-quarter and 19 per cent year-on-year to Rs 3,249 crore and accounted for 68 per cent of total revenues. Wipro Infotech, the India, Middle East and Asia Pacific business grew 72 per cent, while revenues for Wipro Consumer Care and Lighting business grew 84 per cent YoY.

Wipro declared an interim dividend of Rs 2 per share.

“The results demonstrate strong execution by Team Wipro on all fronts. Revenues from out Global IT business at $796.5 million, including $6.4 million from Infocrossing, were ahead of our guidance of $777 million,” said Mr Azim Premji, Chairman, Wipro Ltd.

“We not only absorbed the impact of the offshore salary increases, but also expanded the operating margins by 80 basis points, which demonstrates the resilience of our business model,” Mr Premji said. The Q2 operating margins for Global IT business stood at 22.4 per cent, up from 21.6 per cent in Q1FY08.

The company raised its offshore wages by 12-13 per cent, which impacted the operating margins by 160 basis points, said Mr Suresh Senapaty, Chief Financial Officer. The impact on OPM was offset by operational efficiency, improved pricing and utilisation, he said.

More Stories on : Financial Performance | Software | Wipro Ltd

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