The Hindu Business Line : Better realisations help Wipro post 12% rise in Q3 net

No impact of US slowdown: Mr Azim Premji, Chairman, Wipro, at a press conference to announce the company's results in Bangalore on Friday. - G.R.N. Somashekar

Our Bureau

Bangalore, Jan. 18 Wipro Ltd said on Friday that improved realisations as well as rationalisation of the mix of billable employees has helped the company tide over the forex impact on profits.

Announcing the third quarter results for 2007-08, the Wipro Chairman, Mr Azim Premji, told newspersons that the company posted a 12 per cent increase in net profit to Rs 854 crore, while revenues grew 33 per cent to Rs 5,303 crore, compared to the year-ago quarter. But, the 12 per cent increase in net income is also among the lowest during the last three years.

“The business environment, US economy, and financial sector worldwide are facing challenges but there has been no impact in our business so far. We continue to see good demand for our services,” Mr Premji said while referring to reports on the imminent slowdown in the US economy.

On a sequential basis, net profit grew 4 per cent while revenues rose 11 per cent. Wipro said revenues from its global IT services and products grew to $910 million (Rs 3,616 crore) during the third quarter but for the fourth quarter it expects an increase of a mere 5 per cent to $955 million.

Global profits

Global IT services’ profit before interest and tax grew 11 per cent to Rs 774 crore during the third quarter compared with the same period last year.

Mr Premji said US dependence has come down from 64 per cent to 62 per cent in the last one year. Going forward, the company expects it to come down further. Non-US geographies are picking up. Mr Premji said Wipro will “accelerate investments” in West Asia, Germany and Canada. “These markets are taking off and the exchange rates are also profitable here,” he said.

Organic global IT margins, however, remained flat despite an appreciating rupee and impact of wage increases, the IT major said. Revenues from Wipro Infotech business rose 39 per cent to Rs 972 crore and PBIT grew 49 per cent to Rs 87.4 crore while revenues from its consumer care and lighting grew 107 per cent to Rs 435 crore and PBIT increased 99 per cent to Rs 52.5 crore.

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