In a surprise exchange filing, Wipro on Thursday announced that its CFO Jatin Dalal would depart and that Aparna Iyer, a Wipro veteran with stellar credentials, assumes his role. While departures of senior talent at companies isn’t new, for Wipro, Dalal’s exit and Iyer’s ascension into the role comes at a critical juncture when the company is on a uphill battle of turning around its fortunes as it lags behind its peers in growth and profitability.

Iyer joined Wipro in April 2003. Over her 20 years with Wipro, she has held several finance roles, including Internal Audit, Business Finance, Finance Planning and Analysis, Corporate Treasury and Investor Relations, and, most recently, Senior Vice President and CFO of Wipro FullStride Cloud. 

She is a qualified Chartered Accountant (CA) and was a gold medalist of the CA 2002 batch, and is touted to have deep expertise in financial risk management, capital allocation, fundraising, and driving business strategy and growth. With this elevation, Iyer will be one of the top female CFOs of a prominent firm, which is quite a rarity in the Indian IT industry. 

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CEO Thierry Delaporte in a release said, “Aparna is an accomplished and results-driven leader. Throughout her 20-year career with Wipro, she has been a dynamic, forward-thinking strategic partner to our business leaders.” 

Iyer replaces Wipro veteran of 21 years, Jatin Pravinchandra Dalal, who resigned yesterday to “pursue professional goals outside the organisation.” His exit right around the time of the quarterly results announcement has raised eyebrows in the industry and wasn’t expected by the majority. Markets too haven’t taken the development well as Wipro’s share price dipped about 2 per cent to ₹418 even as broader market indices opened flat. 

Dalal’s exit underscores the high top-level attrition rate being seen in the last couple of years at Wipro. Under the leadership of its fairly new CEO, Thierry Delaporte, the company has seen numerous exits. In the last 24 months itself, Wipro has bid adieu to nine of its top-level execs.

“Quite a few senior management personnel have quit Wipro in the past 9-12 months. Jatin’s exit adds to the list. Some of the changes may have been necessary to check underperformance. However, the loss of key leaders continued into the fourth year of turnaround will not be viewed favorably,” notes Kotak Institutional Equities in a note. 

With rising top-level attrition, lagged growth and profitability in comparison to peers is also a growing concern for the company. Its turnaround journey led by Delaporte from around the time of the pandemic has not gained much ground and is still struggling. Iyer now faces a mammoth task as the company’s revenue and profit growth are subdued, margins aren’t seeing great improvement, relative to peers, and guidance remains severely modest and instills limited confidence. 

In the last quarter (Q1) Wipro reported a 6.6 per cent sequential decline in net profit at ₹2,870 crore. On a year-on-year basis, profits grew 12 per cent. Revenue from operations saw a 1.54 per cent q-o-q decline and 6 per cent y-o-y growth.  In constant currency terms, revenue dipped by 2.8 per cent. Wipro’s outlook for the quarter ahead too remained soft, its sequential guidance was tepidly revised to -2 per cent to 1 per cent from -1 to -3 per cent guided last quarter. Margins albeit were stable at 16 per cent, are still below the aspirational level of 17 per cent. Clearly, Iyer has her task cut out.

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“Wipro is struggling in its turnaround effort, has a weak mega deal pipeline and is vulnerable to vendor consolidation. We expect the company to underperform peers on growth in FY2024E and in the medium term. The low-growth characteristics justify its inexpensive valuations,” brokerage firm Kotak noted. 

To be sure, the Indian IT industry at large is in a turbulent uncertain slump phase as the macroeconomic headwinds bought on by probable slowdown in Western economies have affected the demand environment and impacted tech spending around the world.