60 years old, but still going strong

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: In the fiscal year 2006, Wipro entered its sixtieth year of operations. From its humble beginnings as a vegetable oil manufacturing unit, the company has come a long way to become one of the global leaders in providing technology solutions to organisations. Over the six decades, the journey has been strikingly profitable, and this is reflected in the fact that revenues have grown by a compounded annual growth rate (CAGR) of 21%, net income has grown by 31% and the market capitalisation by 25%.

“Importantly, in most of these years, we have led industry growth in the segments we operate in. And all the time we have constantly invested, to conquer new frontiers and sustain future growth,” said Azim Premji, chairman, Wipro, in a message to shareholders.

In fact, growth has become a habit at Wipro. For FY2006, total revenues grew to Rs 10,625.8 crore, a growth of 30% over the previous fiscal. Net profits touched Rs 2,250.6 crore recording a 24% growth over the previous year. The company managed to increase its active customers base taking the number to 494 in FY06, from 421 in the previous year.

This growth Premji attributes to the restless nature of the team at Wipro, which does not rely on past laurels and consistently invests in reinventing itself. The ideation process is then met with strong operational performance and execution. “That’s where Wipro scores,” he says.

There has been consistent investment in innovation initiatives, and these have started generating results for the company. Premji mentions that innovation initiatives have contributed to around 5% of the revenues in FY06. The plan is to have the share from innovation led initiatives touch 10% of the revenues in the next three years.

One of the key performance achievements during FY06 was that the company won five consecutive contracts in the total outsourcing space, which is a unique and specialised service line. Prime among these contracts was the total outsourcing deal with HDFC Bank. The contract is a multi year contract worth Rs 360 crore.