Wipro net up 17 per cent Q3

Revenue grew by 12% to touch Rs 876 crore

ENS ECONOMIC BUREAU

BANGALORE, JANUARY 18: IT major Wipro Ltd has posted a PAT of Rs 224 crore in the third quarter of the current fiscal representing a growth rate of 17.44 per cent —disappointing analysts —even as its revenue grew by 12 per cent to touch Rs 876 crore as against PAT of Rs 190.4 crore and revenue of Rs 781.9 crore in the same period in the previous year. Wipro warned global IT revenue will fall next quarter as it faces uncertainty amid severe price pressure.

For the nine-month period the revenue grew by 18 per cent to touch Rs 2550 crore while profit after tax touched Rs 650 crore representing a growth of 44 per cent.

However, on sequential quarter basis the net profit increased by a mere 3.3 per cent while revenue dropped by 0.2 per cent. While PAT touched Rs 224 crore for the quarter compared to Rs 216.5 crore in July-August 2001, revenue declined to Rs 876 crore from Rs 877.6 crore in the same period.

Wipro’s shares reacted negatively to the results and outlook. They fell as much as 7.13 percent to Rs 1,620 at the Bombay Stock Exchange, and closed at Rs 1,610.10.

The revenue projections for the quarter ending March 31, 2002 is $120 million which is $5 million less than performance in the just concluded quarter. Despite the fall in the growth rate Wipro Chairman Azim Premji said the company would stick to its earlier projections of touching growth rate above the industry average. “Our results for the quarter were in line with our expectations in an environment of enhanced economic turbulence”, Premji said.

Wipro Technologies Ltd CEO and vice chairman Vivek Paul said the decline in telecom equipment and internet business was 23 per cent as against the 10 per cent fall projected by the company earlier. He said the company is going to offset the billing and pricing pressure through better realisations by moving up the value chain. While the company achieved a blended price increase of 2 per cent the volume was down by 2.4 per cent, he added.

“I think the next financial year continues to be surroundedby uncertainty,” Vice-Chairman Vivek Paul told a news conference. “The key challenge for Wipro is going to be to climb the value chain faster than the drop in overall prices,” he added.

Paul also ruled out the possibility September 11 impacting the IT sector in the coming days. “September 11 is history. There is no residual impact. But the impact came from technology recession in the US and rest of the world”, he added.

“We have seen all round sequential growth across verticals, except in telecom and internetworking. The sequential growth in financial services 19 per cent and enterprise application services of 41 per cent contributed to an 8 per cent growth in enterprise business”, he added.

Both Premji and Paul refused to divulge any guidance about the business prospects in the coming year.