Wipro CEO Abidali Neemuchwala on Tuesday said that the company is confident of meeting average growth of the IT industry in the fourth quarter of the current fiscal even as the outlook for the third quarter disappoints.
Wipro CEO Abidali Neemuchwala on Tuesday said that the company is confident of meeting average growth of the IT industry in the fourth quarter of the current fiscal even as the outlook for the third quarter disappoints, following the announcement of its earnings in the second quarter. The company reported more than 5% quarter-on-quarter rise in consolidated net profit for the quarter ended September 30 at Rs 2,190 crore against Rs 2,083 crore in the previous quarter.
The Wipro CEO said that the outlook for the third quarter has a seasonal impact of furloughs and higher leaves, but will meet industry average growth in the fourth quarter. In the third quarter, Wipro estimates that its revenues from the IT services will be between $2,014- $2,054 range, a growth between 0-2% while CNBC-TV18 poll estimated Wipro’s growth for Q3 between 1.5-3%.
He further said that the communications business of the company is challenged by project completions and its growth will rebound between October and December. Abidali Neemuchwala sees strength in Banking, Financial Services and Insurance (BFSI), but the healthcare segment will remain volatile.
India’s IT bellwether reported IT service revenue at Rs 13,169 crore as against a CNBC-TV18 poll of Rs 13,200 crore. The EBIT also came in higher than expected, as Rs 2,278.4 crore, as against CNBC TV18’s poll estimate of Rs 2,191.2 crore. EBIT margin saw a rise of more than 17%, as against analysts estimate of 16.6%. Constant currency growth saw a 0.3% rise as against poll estimates of 0.9%. In the last quarter, the IT major had reported a consolidated revenue of Rs 13,626 crore.
Wipro shares closed at Rs 290.05, down by more than 0.2% from the previous close. Wipro shares have returned 22% in the year so far, at a time when the BSE IT Index is reeling under pressure with returns of just 2%.