India’s
third largest software services exporter Wipro Ltd on Tuesday reported a higherthan-expected net profit for the fiscal second quarter (Q2) as it added more clients and benefited from a weaker rupee, warning at the same time that it needed at least two more quarters to catch up with rivals in the pace of revenue growth.
The Bangalore-based company’s net profit jumped 28% from a year earlier to $309 million in the three months ended 30 September. Revenue rose 19% to $1.76 billion during a quarter in which it added 45 clients.
Wipro, which has lost market share to rivals over the past five years, had been expected to post a profit of $302.6 million on revenue of $1.78 billion, based on a survey of analysts by Bloomberg.
Indian information technology (IT) companies, including Wipro’s bigger rivals Tata Consultancy Services Ltd (TCS) and Infosys Ltd, have reported robust earnings in Q2, helped by the rupee’s depreciation and a revival in outsourcing demand. The rupee has weakened 9.35% against the dollar this quarter, making Indian products and services more competitive in overseas markets.
“There are positive indicators on the global economy. Client confidence is on the uptick and we see it reflected in our results,” chairman Azim Premji said in a statement.
Shares of Wipro surged to their highest close in more than 13 years, gaining 1.7% to ` 514.90 each on BSE on a day the benchmark Sensex lost 0.1% to close at 20,864.97 points. The company announced its earnings after the markets closed.
Wipro, the only one among India’s top five software services companies that provides quarterly guidance, on Tuesday forecast revenue in the range of $1.67-1.69 billion for theDecember quarter, which is expected to be the weakest for Indian software exporters due to client furloughs.
pratima kumari
pgdm 1st sem
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