Wipro has provided a muted revenue growth guidance for the third quarter of the fiscal despite the IT major traditionally putting in a strong performance during this period. In a free-wheeling conversation with TK Kurien, CEO, Wipro, delves on a range of issues — from digitalisation to remuneration. Kurien is confident about the IT major’s prospects for the second half of the fiscal as they have been winning large deals and there has been an improvement in pricing. Excerpts:
How do you view the revenue guidance of 0.5-2.5% for the third quarter?
If one looks at the guidance, the difficult thing to estimate is the impact of furloughs. There has been little bit of uncertainty, that is the reason for the drop in numbers. The second reason is the lesser number of working days. We frankly do not know where it will end up. We are experiencing the impact in manufacturing, financial services and some part of retail.
Do you expect energy and utility vertical to stabilise?
Well, there is not a single deal we have lost in energy and utility from a consolidation perspective. We are going through a transition and the revenue will kick in from the fourth quarter. There will be growth as we go through the consolidation.
How do you see the pricing environment?
It is not something we see across the board. We see pricing pressure, especially in ticket sizes (large deals). The unit rate per person for us is not under pressure. In fact in the second quarter, our unit rate per person has actually gone up. I think levers are plenty, despite the investments we are going to make.
Do you expect any improvement in margins?
There are plenty of margin levers. As we push automation, we are going to see significant uptick in terms of ability to take out applied manpower from projects. We believe digital is a massive opportunity, it is growing 2x compared to rest of the business. We need to train people on digital technologies. We believe there are enough levers in the current business to improve the margins.
Will Wipro be increasing the salaries for campus hires?
We are not going for any entry level salary hike. We are hiring in large numbers and going to campuses with no issues in attracting people.